Times are tough, and Indians are starting their own businesses from home. You might have a business idea, but do not know where to begin, where to apply or how much money you need.
We have written blogs to help you start a business with zero capital, and also suggested a few ideas to help you come up with business ideas.
In this blog, we will discover how to set up and maintain a micro-business, as defined by the Government.
What is a micro business?
According to a recent update by the Indian Government, MSMEs will now be classified based on both investment and turnover. Through this new definition, MSME minister Nitin Gadkari hopes to help the different sectors access Government schemes, loans and tax benefits.
Here’s the new definition for MSMEs as of yesterday:
- Microbusinesses – Investments up to ₹ 1 crore and turnover of fewer than ₹ 5 crores.
- Small businesses – Investment up to ₹ 10 crores, turnover of less than ₹ crore.
- Medium businesses– Investments up to ₹ 50 crores, turnover of fewer than ₹ 250 crores.
A micro business includes solo entrepreneur ventures or any business that employs less than 9 people. When you set up a brand new business from scratch, you can choose to classify it as micro, small or medium based on the above criteria.
5 Key Tips to Remember When Setting up your micro business
Draft a one-page business plan:
Starting a business goes beyond selling, acquiring customers and making a profit. Set up a plan to define your business brand. Write/type out your company vision and mission, what you will sell through your brand, who you wish to cater to (customers you want to attract). Keep it simple, easy and concrete.
Decide on a budget:
How much capital do you have to kick off a business? Do not invest a lot of money right away, and if you are self-funding, it is important to be realistic. Set up a separate account for all business transactions. Also,
- Make sure you are always cash flow positive. This guide can help you manage your working capital requirements.
- Do not hesitate from applying for a small business loan because of the COVID pandemic. The Government has introduced collateral-free MSME loans of up to ₹3000 crores to help businesses back on its feet. Check out the different Government schemes you can avail when looking for a micro business loan.
- Maintain a record of all your finances online. We will cover this in detail in the next few points.
Register your business:
Even if you are setting up a business completely from scratch, it’s best you register it right away. Registering your business allows you to avail GST benefits, create a website, patent products and start your paperwork.
Need help to set up? LegalWiz can help your brand stay protected with trademark registration, for example, logo, slogan or packaging. LegalWiz.in helps thousands of businesses to register their intellectual properties and prevent unauthorized use of the mark by competitors. Check out their app on the Instamojo dashboard.
Important: If you do not have the funds to register your business on a legal site, simply register it on the Udyog Aadhar Memorandum portal. Over 1 crore MSMEs have registered for the Udyog Aadhaar all over India since September 2015. It is a one-page registration form and helps you register your business in a few steps.
Find an online platform to set up a business:
If you are starting a business during the lockdown, choose an online platform. This helps you keep business afloat even when there is a lockdown in the country. You can:
- Create social media handles: This goes without saying, but creating a business social media handle helps you spread the word pretty easily. Start a business page on Facebook, Instagram or Pinterest. Share your business ideas and form groups on Quora, Reddit and Twitter. Download our free ebook to know the tips and tricks to sell on social media. Click the image below to download the ebook.
2. Create a website or blog: If you wish to set up a website, here are some tools that can help you design your own. We recommend you set up your business website in the later stages of setting up your business. You can set up a blog on Wix or WordPress to curate content and featured articles about your brand and let your customers know a little more about your business.
3. Use an online store e-commerce builder: The Instamojo premium online store is the answer for when you want to set up a business but do not want to spend money on a website. The new premium online store comes with inbuilt apps, tools and a live chat feature that allows you to sell your products and services like any other e-commerce site. Check out the new features here.
Slowly scale your business with tools:
Choose a payment gateway to collect online payments. You can keep your payments in one place with a trusted payment gateway like Instamojo. Once your business takes off, invest in software that helps you attract and retain customers.
For example, the Shoppr App on the Instamojo app store helps you focus on the most valuable users and target users using multiple mediums, where they are more likely to convert.
Manage your accounting using Profitbooks. Keep a track of your budgeting, inventory and invoices
Important: Always stay updated on the latest GST updates by the Government. Keep yourself informed and upskill on online learning platforms like mojoVersity to know the intricacies of different ways to do your business.
Story of a large-sized micro business: How LivingClay used Nostalgia to sell its products
Devika Kulkarni researched for years. She travelled across the globe and came back to India to set up a tiny ceramicware business. Her business plan was simple – show people how to spruce up their homes with simple, elegant ceramicware that reminds them of their Grandmother’s kitchen.
Devika worked backwards. She set up an Instagram handle, a website and sought out Instamojo’s online store to feature her products.
View this post on Instagram
INSTAMOJO WEBSTORE | LINK IN BIO Some teaware on our instamojo web store that can still be picked up . The Fluted coffee mugs from the Farmhouse Collection. Many use these to serve hot soups or even chilled beer! Ivory with red flutes, these mugs do have a rustic charm. . #flutedmugs #flutedceramics #artisanal #sale #livingclay #livingclayexperience #rusticcharm #rusticlook #teaware #coffee #functionalceramics #pottery #ceramictableware #tabledecor #homedecor #highfired #instamojosale #teatime #coffeebreak
Like many micro-businesses, Devika’s biggest support is her audience. Her audience shares her work, spread the word about her unique products and provide constant feedback. So, if you want to set up and grow a micro-business from scratch, work hard on your customers’ happiness. Luckily, we have an ebook for that too.
Want to set up a micro-business like Devika Kulkarni did?