10 cheap business ideas to start for under £5,000

If you’re looking for cheap business ideas with bags of potential, take a look at these...

Our experts

We are a team of writers, experimenters and researchers providing you with the best advice with zero bias or partiality. This article was authored by:
  • Gareth Platt

10 low-cost business ideas

1. eBay business
2. Wedding planning
3. Childcare and babysitting
4. Tutoring
5. Editing and proofreading
6. Market stall
7. Sports coaching
8. Handyman business
9. Cleaning business
10. IT support and repairs

Read on for our explanation of why they're potentially lucrative, as well as low-cost, business ideas…

Not everyone starts a business following a ‘eureka!' moment – many people decide they want to be their own boss then embark on a search for business ideas.

To do this, of course, you need to ensure you find the right business for you. You also need to make sure you have sufficient funding in place to support both yourself and your start-up until the business becomes sustainable.

However, not every business requires a vast amount of investment to get it off the ground. Here, we look at 10 low-cost start-up ideas to give you a taste of what each involves – and hopefully, some inspiration.

From starting an eBay business at home to becoming a wedding planner, we look at what investment, skills, qualifications and attitude are needed to make each venture a success:

eBay business

What does an eBay business involve?

It's pretty simple to become an eBay trader; in fact, there's probably no simpler start-up opportunity around. All you need to do is set up an eBay account, upload some images of your product and a brief description, and you're away. You can trade with people from all around the world, and handle orders of all sizes – from a one-off transaction to batches containing hundreds of units.

However, while it's easy to begin trading, making it a success is not so simple. As with any start-up, this will require much hard work, research and planning. Much of your success comes down to choosing the right products, so before you begin it's worth spending time researching the competition – look at what's already being sold and try to find a niche or a point of difference.

How much does it cost to run an eBay business?

There's no cost to register, and the amount it costs to display your product will depend on the size and value of your item. It usually costs between 10p and £1.30 to list an item for auction on eBay (most fixed price listings cost 40p), and for most items eBay now takes a fixed fee of 10% of the final selling price (regardless of how much the item sells for). This does vary across different product categories though – for example, for consumer electronics the fee is just 3%, while for clothing, shoes and accessories eBay takes 12%.

Once you've created a business account you can also choose to set up an online shop by paying a monthly subscription fee. This ranges from £14.99 a month for a basic shop package to £349.99 for the most advanced features.

How much can I earn as an eBay entrepreneur?

Nick Best, who's been trading on eBay for eight years says: “The market's huge at the moment, basically because people are running out of money and looking to make money, and Christmas is on the horizon.

“You may be able to make between £12,000 and £50,000 in a year. If you've got hundreds of a particular item, you're only paying to put it up once – if you've got 50 second-hand computers for sale, with the same spec, you can put them all up in one go.”

However, it's important to think about the people who use eBay, and what they'll buy. Some types of product, such as antiques, tend not to sell well – as prospective buyers like to see an antique before they buy, and the demographic isn't really represented on eBay.

What sort of skills and personality do I need?

A selling background can be useful, but it's not a pre-requisite. However, good people and communication skills are a must if you want to make a success of an eBay venture.

Best says: “It can be helpful to have an IT and publishing background, and the ability to write enticing specs. I try and make the description humorous, and try to put a bit of history behind the item – make it more colourful for a prospective buyer.”

Top tips for eBay success

  • Stay at it – persistence is crucial. Start small and grow the business slowly – don't invest huge amounts in stock until you've learned what sells.
  • Continue to look for new customers, and tweak your specs and images if necessary.
  • Respond to buyers quickly – remember that receiving positive feedback on the site is crucial to winning new business, as this will set you apart as a reliable seller.
  • Exceptional customer service is key.
  • Remember to register as self-employed with HMRC – even if you are employed elsewhere and running the business as a part-time venture initially.

If you're a good communicator with an eye for what sells, read our step-by-step guide on how to start an eBay business. Alternatively, check out our guide on how to set up an Amazon Marketplace business.

Wedding planning

What does a wedding planning business involve?

Planning a wedding involves taking creative control of all aspects of your client's big day – from researching the venue to booking flowers, entertainment and wedding cakes, designing invitations and advising guests on etiquette.

How much does it cost to start a wedding planning business?

Kelly Chandler, of the UK Association of Wedding Planners (UKAWP), tells us: “You have to set up a good website, which can cost anything from £500 – although wedding planners generally have good creative skills, so you may be able to manage part or all of the web design stage yourself.” You could also set up a basic site for free using self-build, template-based services.

“There's no official qualification, although we at the UKAWP do training courses, which cost £599 for a full weekend. You also need a base – most people work from home but they still need a good computer, a digital camera and a colour printer,” adds Chandler.

Hundreds of companies have sprouted in this sector over recent months, so you may have to advertise to get your name out there. Rates will vary, although a full-page advert in a national wedding magazine should set you back at least £1,000.

How much can I earn as a wedding planner?

As long as you're prepared to wait it out initially, wedding planning can offer a potentially lucrative low-cost business opportunity. According to Kelly Chandler, “it's hard to say how much you'll earn, because it'll totally vary. Expect to earn very little in the first two-three years – you may even have to forget about a regular salary. Beyond that you can earn good money.”

What sort of skills and personality do I need?

You need to treat each client's wedding as if it were your own. Each wedding has to be given the utmost love and passion, and you need to establish close relationships with each couple that engages you, so you can understand their perspective and what they want.

You also have to be patient. Sometimes the client's views will differ wildly from your own, and you're sure to hit snags in the preparation of each wedding. If you're blessed with a warm, measured character, and good communication skills, you've got a real chance of success.

Top tips for wedding planning success

  • Approach each project with passion and motivation.
  • Be persistent – wedding planning is glamorous, but it's hard work too.
  • Create a good support network, with all your family and friends on board.

With the wedding industry bigger than ever, if organisation and people skills are your key strengths read our step-by-step guide on how to become a wedding planner.

Ready to get started? Find out everything you need to know about how to start your own business here.

Childcare and babysitting

What does a babysitting business involve?

If you've occasionally babysat for your friends and relatives, and think this is all the experience you need for a full-time business, think again. The babysitting market is very congested; there are hundreds of companies out there, each offering their own unique and tailored service.

Boutique Babysitting, for example, specialises in looking after children at music festivals; its service amounts to a full-scale mobile crèche. If you want to compete with these companies, you need to put in hours upon hours of research and concept development, to ensure there's a gap in the market for your service, and you're capable of meeting the expectations of the parents in your area.

How much does it cost to start a babysitting business?

Whether you're doing everything on your own, or wish to enlist the support of other babysitters, it's a good idea to get a criminal records bureau (CRB) check. Although there is no formal requirement for a CRB certification, many parents will expect that you have one, as you are offering a professional service in this area. Checks can cost up to £60, depending on the umbrella company you use, so it can get expensive if you're planning to employ large numbers of staff.

If you're planning to employ other people, it's also worth thinking about the type of people you're going to hire.  Selina Cope, co-founder of Boutique Babysitting, said that “it (babysitting) is a profession these days, although teenagers can still do it for cash in hand.

“All of our staff are childcare professionals, they're all NVQ trained, and we have teachers as well. We would ask for a minimum of two years' experience, and first aid training is preferable.”

If, like Boutique Babysitting, you plan to open a crèche or activity group, you'll need specialist insurance for these ventures.

How much can I earn as a babysitter?

Babysitting rates nationally tend to fall between £6 and £10 per hour; however it's worth noting that a large portion of the industry is still made up of casual teenagers, and as a professional company you should be able to charge more.

Selina Cope says that, “for babysitting we charge between £10 and £15 per hour, per person, per family. For kids' club, our children's activity arm, we charge £10 per hour per child in the day, £15 at night.”

What sort of skills and personality do I need?

You need years of experience in childcare; ideally, you'll have worked as a nanny or run your own childminder business for several years, and you'll know the business inside out. You also need to be prepared to do a lot of paperwork, particularly regarding CRB checks.

Top tips for babysitting success

  • Understand that a babysitting business is actually a lot of hard work.
  • Research your competition, and find out if anyone is offering a similar service in your area.
  • Expand and diversify to meet the particular needs of parents in your locality.

Tutoring

What does a tutoring business involve?

As a tutor you can teach anything from basic reading and writing to advanced post-graduate courses, and work with anyone from infants to adult learners. You can provide your lessons in established schools and colleagues, in your own home, or by correspondence – depending on the nature of your subject and what your clients want.

How much does it cost to start a tutoring business?

If you're going to teach your specialist subject to others, you need to be at least one level in advance of the level you are tutoring. Tutors often teach the subjects they studied for their degree or at A-level – the higher your qualification, the higher the level at which you'll be able to teach. If necessary, it's worth looking at your local universities and colleges to see what they can offer you in terms of qualifications and courses.

You'll also need a good computer, and the most up-to-date textbooks in your subject area. You'll also need access to the correct year's syllabus (around £2) and sample exam papers (50p to £1). Beyond these core expenses, the precise cost will depend on where you choose to conduct your classes. Renting a serviced office space will be far more expensive than doing it in your own front room or your clients' home.

Again, if you're working with children it may be worth investing in a Criminal Records Bureau (CRB) check in order to reassure parents, as well as an tutors you hire have had the necessary checks. (See the childcare section for more information).

How much can I earn as a self-employed tutor?

It's important not to set your sights too high early on – if you charge too much before you become established, people will start questioning your credentials. But, as an expert in your field, it's reasonable to charge £15 an hour from the outset.

What skills and personality do I need?

As is the case in any business based on teaching or coaching, knowing your subject is only half the battle; you also need to be able to deliver it. You might think your area of expertise is mind-blowingly compelling, but if you can't convey this belief, you'll get nowhere.

You need to be friendly in your approach, but ready to offer criticism if that's what your client needs. There's no point being too nice – if your clients aren't making progress, you need to let them know. Otherwise they're throwing their money away!

Top tips for tutoring success

  • Take a step back, and ask yourself if there is a need, and popular interest, in your specialist subject area.
  • Focus on building word-of-mouth recommendations and consider  offering free extra lessons to add value for your clients – perhaps if there is an exam approaching.
  • When marking clients' work, make sure you always provide as much feedback as you can. You can't go into too much detail in your comments.

If you're patient and know your subject inside out, read our step-by-step guide on how to set up a tutoring business.

Editing and proofreading

What does editing and proofreading involve?

It means taking raw copy and turning it into something which can be published. You may be copy-editing (looking at style, accuracy and readability), proof-reading (checking for errors – usually the final stage in the editing process), or both, depending on the client's specific requirements.

As an editor, you'll be looking for obvious things like grammar and spelling, as well as clarity. In some cases, you may have to do nothing more than check the copy over; in others, you may be asked to do a complete rewrite.

How much does starting an editing and proofreading business cost?

If you've not got vast writing or editing experience you're going to need training. It's not something you can just do because you like books – there's much more to it than that.

You'll also need decent computer equipment. A good email system is a must, as are up-to-date copies of Word and Adobe Acrobat. Thankfully these packages are generally affordable and accessible, so you won't have to break the bank. Finally you'll need to invest in reference books, such as dictionaries and style manuals. Book publishers tend to use Butcher's Copy Editing and Hart's Rules on points of style, so it's worth getting your hands on both of these.

How much can I earn as a self-employed editor?

Earnings will vary vastly, depending on your level of experience and the people you are targeting. If you want a rough idea, the SFEP website offers recommended minimum rates –  these typically range from £20 to £25 an hour.

What sort of skills and personality do I need?

Wendy Toole, chair of the SFEP, says: “You need to be self-motivated, because you've got to get up in the morning and get on with your work. You must have good concentration, and be patient and polite – remember that you're somewhere in the middle between an author and a publisher.

“You have to have an eye for detail, good command of language, and also real sensitivity to language. If you have an existing skill – for example, if you've worked as a lawyer or architect – that can help.”

Top tips for editing and proofreading success

  • Join an organisation such as the SFEP for advice and support.
  • Plan for uptimes and downtimes, particularly when you're starting up. You need a cushion behind you, because you won't be working 35 hours a week straightaway.
  • Don't try to cut corners, don't claim to be able to do things you can't and don't try to get away without doing the training. A lot of people are trying to do this out there.

If you have great attention to detail and a range of industry contacts, read our step-by-step guide on becoming a freelance copywriter.

Market stall

What does running a marketing stall involve?

This one's fairly self-explanatory – as a market trader, you simply have to set up a stall on your local market and start trading. As anyone who's ever been to a market knows, you can sell pretty much anything there, so the possibilities are endless.

How much does it cost to start a market stall?

To start with, you might want to pitch up at your local car boot sale – provided you talk to the organiser beforehand, and you're prepared to pay a small amount for your slot, you should be able to secure a position. Then, when you've established yourself and learnt the ropes, you can look into renting a stall at your local market. This will usually cost around £20 a day. However, competition for slots is fierce so you may have to start off as a casual trader, which could mean standing in queues early in the morning waiting for a stall to become available. Your success as a trader will also be determined by the products you choose.

To secure a good quantity of stock, you'll probably need to contact a wholesaler – magazines such as The Trader offer a wide selection. You'll also need a street trading licence from your local council, and the cost will vary depending on your location. London's Hackney Council, for example, charges £30 for both a 12-month permanent licence (for a fixed pitch) or six-month temporary licence, allowing you to trade wherever there's a pitch available.

How much can I earn as a market trader?

There really is no firm answer. It all depends on what you're selling, how much you're selling, and how frequently you trade. According to the government's NextStep advice site, a trader operating several days a week is likely to make between £15,000 and £26,000 a year.

What sort of skills and personality do I need?

Good presentation and communication skills are essential. If you can draw people to your stall, engage them with entertaining patter and give them the impression they're getting a bargain, you've got a good chance of making this business work.

You'll also have to think on your feet a bit. If you're selling perishable goods, you'll have to find ways to shift them towards the end of the day; if you're selling something that's not particularly fashionable or obviously useful, you may have to demonstrate new and unusual uses to people visiting your stall. And you've got to be persistent – some days will be better with others, and you've got to stick with it through good times and bad.

Top tips for market trader success

  • Spend plenty of time at your local market. Find out when it's busiest, and which stalls and traders are doing best.
  • Write down all the features and benefits of the products your selling, and rehearse them so you know them off by heart when you're in front of the customer.
  • Think about discounts and bulk-buying deals to entice sceptical visitors.

If you're an early riser with an eye for a good product, read our full length guide of steps on how to set up your own market stall, .

Sports coaching

What does sports coaching involve?

Sports coaching can involve anything from training the local football team to running classes and activity groups for toddlers and young kids. There are loads of opportunities to explore – but, if you want to succeed, you'll have to fend off competition from dozens of rivals.

How much does it cost to start a sports coaching business?

If you want to be taken seriously as an expert in your particular discipline, you'll need a qualification, preferably provided or verified by the national governing body for your sport. This can cost anything up to several thousand pounds, depending on the body which runs your course and the length of time it takes. Sports Coach UK offers some excellent tips and advice in this area, so it's worth checking them out.

If you're working with kids, you'll also need to pass a criminal records bureau (CRB) check, which can cost up to £60. And it's crucial that you have all your own equipment. Things like cones, bibs, balls and posts don't come cheap, but there are loads of providers out there ready to assist you.

How much can I earn as a sports coach?

According to data compiled by recruitment expert Prospects in 2009, sports coach salaries can make anything up to £28,000 a year. If it's your own business, and you hire other coaches to work for you, your income could be even higher.

What sort of skills and personality do I need?

It's not just about knowing your sport, and being good at it – you have to be able to communicate with the group you're training, and impart your knowledge in a fun and absorbing way.

You need the personal skills to make all members of your group feel welcome and valued, regardless of their ability. And, if you're coaching large numbers of people, your sessions must keep everyone involved at all times – if people get bored, they won't come back.

Top tips for sports coaching success

  • Think about what you can coach, rather than what you can play yourself.
  • Work out how much people in your area are prepared to pay.
  • Go to other sports coaching classes, to get inspiration for your own lessons.

Handyman business

What does a handyman business involve?

The concept of a handyman business is fairly new – until recently, property and maintenance firms tended to specialise in particular trades, rather than offering a combination of several.

But now more and more people are starting their own handyman businesses, and making a living out of being a ‘jack of all trades'. However, if you want to be successful, you need a working knowledge of all the various maintenance skills – and be prepared to take on any job, no matter how small.

How much does it cost to start a handyman business?

You'll need a vehicle to get from job to job and a decent set of tools. Prices for a good second-hand Transit van will probably start at £2,000-£3,000. Websites such as Auto Trader are also a good place to start and you may well find vehicles that are a lot cheaper. However, make sure the vehicle's in good working order or it could end up being a false economy. If buying a van outright is too expensive, there are also leasing options available.

You'll also need a basic toolkit, and you can pick one up for as little as £25.

There are also additional costs to consider, including marketing and insurance. Alan Storry, of ourhandyman.co.uk, says: “To promote my service I purchased a business stationery pack, consisting of letterheads, postcard sized flyers and business cards, for around £60. For bookkeeping I used a spreadsheet, and also got an accountant to do my year-end work for £65.

“I purchased a domain name for £7 for two years, as I knew the internet would get me jobs in the future. I was able to make my own website, so there was no cost for that, but hosting was around £150 for the year.”

How much can I earn as a handyman?

This all depends on what you can do. If you can do domestic plumbing, for example, then you can charge around £20 per hour for fitting a bath or toilet, depending on your location.

Alan Storry continues: “The standard handyman work for a single operator is around £12-£15 per hour.  We tend to always have a minimum charge of £30, because going from one job to another can eat away at your time.”

What sort of skills and personality do I need?

A polite and caring attitude is essential. You need to call the customer if you're going to be late, and keep them in the picture. Alan Storry says:

“Too often I find that workmen think the customer should be happy simply because you're doing the job! Put yourself in the customer's shoes: how would you feel if you had been given a time that the handyman would be at your home, and he turned up one hour later?  It's not good, and your customer may never call you again.”

Another key attribute, which always goes down well with customers, is tidying up after yourself. Alan Storry continued: “I find that tradesmen tend to do what they do and leave the cleaning up for the customers, so if you clean up and make the place look as you found it then your customer will just keep coming back for more.”

Top tips for handyman success

  • Only do the jobs that you are capable of doing.  You can learn the jobs you have been asked to do for next time.
  • Always keep the customer informed of progress. If you're going to be late, then call.
  • Keep learning new skills, whether going back to college for short courses or using the internet.

If you're a DIY guru with great attention to detail, read our guide to setting up a handyman business.

Cleaning business

What does a cleaning business involve?

The contract cleaning business is all about providing an exceptional service to clients. A typical job will involve cleaning building interiors, like offices, to an agreed standard within a contractually agreed cost. You could also set up a domestic cleaning business, cleaning people's homes.

How much does starting a cleaning business cost?

Start-up costs will vary greatly depending on the type of business you set up (whether domestic or commercial). Commercial contract cleaning will usually incur much higher start-up costs, as you will often need to buy specialist equipment and take on more staff. However, the earning potential can also be much higher, while contracts are generally more frequent and reliable.

Some 80% of a contract cleaning business' costs are labour. The remaining costs are likely to lie in equipment and disposables.  You'll also need to set aside some of your budget for marketing, such as leafleting and advertising. Providing a great service is also key – contracts can often be picked up when clients are dissatisfied with the incumbent contractor.

How much can I earn running a cleaning business?

Andrew Large, director general of the Cleaning and Support Services Association, says: “It's important to be realistic – very few people get rich out of cleaning, and there's plenty of competition out there. Many clients will expect to pay the National Minimum Wage; even as an employer, you may only end up being paid at that rate for certain jobs.”

Margins in the industry are typically 5% or less, so if you want the money to start rolling in, you'll need to differentiate yourself on the basis of service breadth, service quality, sustainability or specialist service provision.

What sort of skills and personality do I need?

Aside from the technical skill in cleaning, you need skills in contract negotiation, staff management and a lot of personal drive. Cleaning jobs often require night working or very early starts, and only the very dedicated will be able to keep this up.

Top tips for cleaning success

  • Keep your costs under control
  • Concentrate on satisfying your customers
  • Look to differentiate yourself from all the other cleaning businesses out there

If you're a perfectionist who's prepared for early starts, read our eight simple steps for how to start a cleaning business.

IT support and repair business

What does an IT support and repair business involve?

Pretty much everyone has used an IT support technician at some point; these people come in and fix problems with either the hardware or software of a computer, often the result of hacking and viruses.

How much does it cost to start an IT support and repair business?

Obviously you will need your own computer (although, if you want to set up an IT repair business, you'll probably have one of these already). Any subsequent costs will depend on the type of repairs you will be offering; however it's probably a good idea to invest in a basic toolkit, including screwdrivers, earthing straps, cables and socket sets. This will probably set you back around £200.

In addition, you'll probably need to subscribe to expertise databases, set aside a small amount for marketing, and invest in a vehicle which gives the appearance of professionalism and reliability.

How much can I earn running an IT support and repair business?

Someone who works from home and runs their business almost as a hobby, might charge £30 an hour for their service; but if you're serious about building an IT support business and are prepared to offer a high-quality service, you should be able to charge more.

A decent starting point might be £40 an hour. As your business grows and you gain experience, you'll be able to increase your rates accordingly.

What sort of skills and personality do I need?

Word of mouth is crucial in this area, so you need to build a strong reputation, based on being simple to deal with and trustworthy – especially if you're offering your services to businesses and gaining access to confidential data. It's also important to avoid the sort of jargon which can alienate the layman, and make you seem inaccessible.

Remember that the value of this service lies in your ability to root out problems and resolve them quickly – so your detective skills may ultimately be as important as your IT ones.

Top tips for IT success

  • Good people skills are a must; you want to come across as  friendly, polite and trustworthy.
  • Offer value-added services, such as regular healthchecks for your retained clients.
  • Always look for the up-sell and the on-sell, creating additional revenue from selling things like web hosting and broadband access. This could earn you an extra £200 a month for doing absolutely nothing.

If you're a computer whizz who's also good with people, read our guide on how to start your own IT support business.

Ready to get started? Find out everything you need to know about how to start your own business here.

Gareth Platt
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