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3 Profitable Business Ideas With Low Investment Under $500

When it comes to profitable business ideas with low investment, how do you know if they will work out for you?

$387,000 per year.

This is the average revenue small businesses earn with 1 to 4 employees.

However, the idea behind profitable business ideas, especially with low investment can be difficult to start initially, especially under $500.

According to Fundera small businesses with no employees have annual revenues of $46,978, which is $6,978 higher than what businesses should make in their first year according to Freshbooks. 

But what skills do you need to really create a profitable business?

Well, the video below covers the top 4 most demanding high-income skills you can start learning right now that you can use to make an extra $10,000+ per month and create your own profitable business from it, it’s worth a look at…

But there’s more to this…

You see, starting your own business can be costly, competitive, and difficult to break through in certain industries. Especially as Investopedia states that only 45% of small businesses fail during their first 5 years and only 25% survive 15+ years.

What does this mean for you?

You need to focus on starting a business with a unique selling point to add to the industry you’re going in. But, the idea or concept you have should be in strong enough demand in the industry you’re going in.

So, this post will cover these 3 profitable business ideas with a low investment of under $500.

The key things we’ll cover with each profitable business idea will be:

  • Steps you can take to get started.
  • List of ideas you can choose to get started.
  • The pros and cons of each business idea.

These business ideas can either start by getting clients first or potentially start without money, and reinvest your profits back into the business.

That’s not all…

As these business ideas can be pandemic or recession-proof if you take your approach strategically, and focus on automating the process over time and within a specific evergreen niche.

You may also benefit from one of these 4 ways you can invest in real estate in this post here.

However, if you’re looking for a simple business idea that can help you make your first $1,000 online, you can have a look at this course here for more details.

So, let’s get into these profitable business ideas…

Business Idea #1: Local Consultancy Agency For Local Businesses

Business Idea #1: Local Consultancy Agency For Local Businesses
Business Consultant

Consulting is a $250 billion industry and has grown just under 2% year on year, according to IBISWorld. Not to mention, this industry has grown by over 2.5% despite the pandemic.

A consultant will typically provide expert advice, opinions, analysis, and recommendations to either businesses or individuals based on certain expertise they have.

That’s not all…

You see, you are a problem solver for people to help them tackle certain issues they may face or help them overcome certain obstacles they face.

For example, a marketing consultant would advise businesses on strategic methods to help minimise the costs to find new customers.

But there’s more…

You can make money by typically charging by the hour or a day rate for people depending on the niche.

This can be around $25 to $300+ per hour or $300 to $1,000 for a day rate, with the opportunity to hire other experts in your industry to consult on your behalf for commission or hourly rate you pay them.

The table below shows an example of the profit you could make if you hire consultants at $25/hr and charge local businesses $100/hr, which is the industry average.

How You Can Automate Your Local Consultancy Agency

Number of Consultants HiredAmount Paid To Consultants ($/hr)Amount Charged To Businesses ($/hr)Net Profit For You ($)
5$125/hr$500/hr$375/hr
10$250/hr$1,000/hr$750/hr
15$375/hr$1,500/hr$1,125/hr
20$500/hr$2,000/hr$1,500/hr
25$625/hr$2,500/hr$1,875/hr
30$750/hr$3,000/hr$2,250/hr
35$875/hr$3,500/hr$2,625/hr
40$1,000/hr$4,000/hr$3,000/hr
45$1,125/hr$4,500/hr$3,375/hr
50$1,250/hr$5,000/hr$3,750/hr
Table showing the potential scale of consultancy business by hiring more consultants and businesses

As you can see, the more consultants you hire the more scalable this business can be for you. 

According to Consultancy.uk, consultants work on average 50 to 80 hours a week, so this could mean you can earn anywhere from $16,250 to $26,000 net profit per consultant per month working for you.

Assuming you have consultants who work 50 to 80 hours a week on average for $25 an hour while you make $75 profit, you could make the following each month:

  • 5 consultants = $81,250 to $130,000 per month.
  • 10 consultants = $162,500 to $260,000 per month.
  • 25 consultants = $406,250 to $650,000 per month.
  • 50 consultants = $812,500 to $1,300,000 per month.

On average, businesses work with consultants 10 hours a week, which is roughly 40 hours a month.

Now, if your consultants were to work 80 hours a week, this would mean you need to have 4X the number of businesses you work with compared to consultants.

So to make that $1,000,000 per month net profit you would need to have at least 200 businesses signed up to your company for consultations.

This shows you the power of scaling up your consultancy agency by simply hiring more consultants to work for your agency.

The more local businesses you work with and the more consultants you hire, the more profit can be made.

Steps To Get Started With A Local Consultancy Agency:

There are many ways you can get started with your consultancy agency. However, all you need to begin with is a niche or industry you are knowledgeable about, and reach out to local businesses to get your first client.

As a result, this will get you off the ground for free before you need to structure further elements with technical details.

But there’s more to this…

If you want to start a more professional approach and work with potential partners and professionals within the consultancy industry, you may want to take on the following steps:

1)- Decide On The Business Model You Want To Take

  • Solo Model: You work with clients individually (hourly or by project).
  • Corporate Model: You hire people to work with clients you have. 
  • Project Model: You can hire or work with clients per-project basis.
  • Hybrid Model: You combine all three methods above.

2)- How Would You Charge For Consulting

  • Do you offer a premium service?
  • What is in your service?
  • Hourly rate.
  • Day rate.
  • Project rate.
  • Monthly retainer rate. 

3)- Work Out A Business Plan

  • How you will fund your business.
  • How will you reach new clients for your business?
  • What is your unique selling point (USP)?
  • Fees and costs.
  • Project targets.

4)- Register Your Company (Ltd or LLC)

  • Decide on the company name if it’s available.
  • What is your Standard Industrial Classification (SIC)?
  • Where is your company Address?

5)- Get Clear On Your Ideal Client 

  • Layout your messaging for your industry.
  • Decide on who you want to work with.
  • Decide on the problem you are addressing.
  • Explain how you can solve the problem.

List Of Niches You Can Start With:

Below is the list of niches you can start your consultancy business in, and start generating clients based on your expertise in these areas:

  1. Accounting consultant.
  2. Compliance specialist.
  3. Management consultant.
  4. Social media consultant.
  5. Business consultant.
  6. Advertising consultant.
  7. Sales consulting.
  8. IT consultant.
  9. Cybersecurity consultant.
  10. Career counselling consultant.
  11. Resume consultant.
  12. Recruiting consultant.
  13. Auditing consultant.
  14. Public relations consultant.
  15. Communications consultant.
  16. Business analytics consultant.
  17. Digital marketing consultant.
  18. Fashion consultant.
  19. Business law consultant.
  20. eBay consulting.
  21. Professional hair consultant.
  22. Event planning consultant.
  23. Personal finance consultant.
  24. Tax consultant.
  25. Wedding consultant.
  26. SEO consultant.
  27. HR consultant.
  28. Safety consultant.
  29. Interior design consultant.
  30. Graphic design consultant.
  31. Web development consultant.
  32. Photography consultant.
  33. E-Commerce consultant.
  34. Environmental consultant.
  35. App consultant.
  36. Dating consultant.
  37. Fitness consultant.
  38. Retirement planning consultant.
  39. Home office consultant.
  40. Legal consultant.

Although there is a range of consultant agencies you can start it’s important to note that these are just the types of industries you can be involved in.

Now, after choosing one of these ideas, you should look into the different niches and sub-niches within each industry to focus on.

That’s not all…

The more specific you are with your selection, the more knowledge and expertise you can develop. In return, this will build more authority as a consultant.

Pros & Cons With A Local Consultancy Agency:

According to StarterStory.com, the consulting business have a range of positives and negatives to deal with. So, here are some of the key pros and cons to think about.

PROS
  • The ability to start your business from home.
  • Flexibility to work as much as you want to.
  • Significantly low startup costs (under $500 you can start it).
  • No overhead costs to get started with consulting.
  • Consulting business is scalable with changing processes.
  • High gross profit margins of 90% being the average.
  • You are in control of the workload.
  • You can pick and choose the clients you work with.
  • It has a simple business model.
  • High hourly pay rates.
  • Various ways of making money.
  • Can build a solid foundation with clients.
CONS
  • A saturated marketplace makes it harder to establish yourself.
  • Consultants have a longer sales process.
  • Can be a huge time commitment, especially during the early stages.
  • The majority of the time you’re sitting at a desk all day.
  • An easy target for criticism as it’s easy to reach large audiences.
  • It can be very demanding if you don’t structure your workload.

Business Idea #2: Social Media Marketing Agency (SMMA)

Business Idea #2: Social Media Marketing Agency (SMMA)

According to marketsandmarkets.com, the social media marketing industry is worth around $14 billion and is expected to almost triple by the year 2026, which is worth around $41 billion. 

Now, a social media marketing agency essentially works with businesses to help achieve their goals through advertising across social media networks for them. 

This can be in the form of paid advertising for faster results or work on organic content production which builds brand recognition over time.

But there’s more to this…

You see, there are many ways you can make money with a social media marketing agency, and a chance to sign a deal with small to large-cap companies.

Typical ways you can make money are the following:

  • Consultations with the company.
  • Selling marketing courses to companies.
  • Have a company pay you a set monthly retainer.
  • You could also charge a retainer and commission based on results.

Now, in the last method, you can typically make the most money and keep your clients for the long term, because you are making them more money and in return, your agency is making more money too.

The table below shows an example of what you can earn by getting 2 new clients per month and charging an average retainer of $2,000/month:

MonthTotal Number Of ClientsTotal Charges To Client Per Month ($)
January2$4,000
February4$8,000
March6$12,000
April8$16,000
May10$20,000
June12$24,000
July14$28,000
August16$32,000
September18$36,000
October20$40,000
November22$44,000
December24$48,000
Table showing the potential scale of your SMMA by adding just 2 clients each month

The numbers you see in the table show the most conservative estimate you could be earning each month with a retainer for the companies you work with.

Now, what if you hire contractors to manage clients for you. Costs for contractors can range from $300 to $800 per client per month.  

So, this would still leave you with $1,200 net earnings after paying your contractors. This would still leave you with a profit margin of 60% to 85%.

Bottom line…

When you start getting a few clients and producing results for them, this is where you can begin to scale your business quickly from $10,000 per month, up to $100,000+ per month. 

This is all done by hiring contractors to manage your client’s social media marketing.                                                                         

Steps To Get Started With A SMMA Business:

The approach to starting your own SMMA business can start the same as a consulting agency. 

You can easily start by getting a client first within a specific industry you know about and either offer to do a 2 week free trial for them or sign a conditional offer for at least 1 to 3 months to show them what you can do.

As a result, you start your SMMA business with no money. 

But there’s more…

Now, with your profits, you can begin taking the following steps to refine your agency and take a professional approach to get more clients, by doing the following:

1)- Register Your Company (Ltd or LLC)

  • Choose a company name.
  • What is your Standard Industrial Classification (SIC)?
  • Which company address are you going to have?

2)- Know Your Ideal Client 

  • What is your overall brand message?
  • What type of clients do you want to work with?
  • Do your clients have enough profit to charge a high retainer?
  • How are their current marketing efforts performing?
  • What can you do differently for your potential clients?

3)- Know What Social Platforms To Use & Keep Up With Industry Trends

  • Understand the social platforms you’re using for your clients.
  • Are there upcoming changes that will impact your marketing efforts?
  • Which platforms provide the most cost-effective approach?
  • Which platform is best to use for your industry?

4)- Decide On The Niche You Want To Specialise In?

  • Does this industry have companies with high revenue?
  • Can you find companies to charge a high retainer?
  • Do you know enough about the industry?
  • Will you be able to scale your business with high-profit margins?

5)- Understand Your Pricing Structure?

  • Can you cover ad spend?
  • Can you use your revenue to hire staff and scale?
  • Will it cover the cost of your overall business expenses?
  • What profit margin do you want to receive per client?
  • Are you charging a commission, retainer or both? 

List Of Niches You Can Start With:

Below is a list of profitable niches you can work in to find businesses that are earning at least $10,000 per month or more. 

As a result, this will allow you to charge a higher retainer per client and scale your business faster.

  1. Car dealers.
  2. Car insurance companies.
  3. Life insurance companies.
  4. Home insurance companies.
  5. Real estate agents.
  6. E-Commerce brands.
  7. Dentist practices.
  8. High-end restaurants.
  9. Solar panel companies.
  10. Interior design companies.
  11. Wedding companies.
  12. Banking & investment lawyers.
  13. Business financing & loan companies.
  14. Tax service companies.
  15. Bankruptcy services.
  16. Travel companies.
  17. Law practices.
  18. Consulting companies.
  19. Accounting service companies.
  20. Financial planning companies.
  21. Mortgage brokers.
  22. Small to medium-chain hotels.
  23. Construction companies.
  24. Medical SPA companies.
  25. Landscaping companies.
  26. Home remodelling companies.
  27. Car modification shops.

By focusing on one specific industry, you can build more authority and trust within the niche you choose.

You can also develop more industry knowledge which will help you best optimise your advertising or content creation for the companies you work with.

That’s not all…

you can pick a sub-niche within these industries you choose, for example, if you want to work with insurance companies then you could strictly work with either car, home or life insurance for example.

The more specific you are about the niche, and ideal client you want to work with, the more money you can make. You also become a “go-to expert” that your clients can recommend to others.

Pros & Cons With An SMMA Business:

Like all businesses you start, there is a range of positives and negatives you should be aware of before diving into developing this business further.

PROS
  • High-profit margins.
  • No overhead costs.
  • Highly scalable.
  • Little startup capital is required.
  • Unlimited income potential.
  • You can start the business from home.
  • You can manage the business from anywhere.
  • You can get more referrals from your clients.
  • It has a simple business model.
CONS
  • Your income is based on results from your clients.
  • Your income is not consistent.
  • Time commitment is very high in the beginning.
  • Has a longer sales process.
  • It can be a highly crowded market depending on your niche.

Business Idea #3: Start A YouTube Channel

Business Idea #3: Start A YouTube Channel

According to Wikipedia the idea of YouTube started over a dinner party during the early months of 2005, Then, in late 2006 Google bought YouTube for $1.76 billion according to Tubics.com.

It has continued to grow in popularity to a point now where millions of content creators have a life-changing careers on the YouTube platform.

That’s not all…

In 2021 the YouTube platform made over $28 billion just from advertising alone which had an increase of 47% since the pandemic in 2020.

Not to mention, the YouTube platform has over 1 billion monthly users, and according to Statista, there is over 500 hours worth of content uploaded to Youtube every minute.

But there’s more…

As you can earn money from YouTube in different ways, such as:

  1. Advertising revenue.
  2. Brand sponsorships.
  3. Affiliate marketing.
  4. Course sales.
  5. Merchandise sales.
  6. Directing traffic to your blog/website to make money.
  7. Building and monetising an email list.

There are also more innovative ways to make money from YouTube which are changing as each day goes by. But, these are the common forms of making money from YouTube which have remained consistent.

With advertising revenue being the most common way to start making money from YouTube, you can typically earn $3 to $18 per 1,000 views.

The table below shows the potential income you can make from 10,000 views, 100,000 views and 1,000,000 views on your videos while earning anywhere from $3 to $18 per 1,000 views:

Advertising Revenue (CPM)Revenue Earnt From 10,000 Views ($)Revenue Earnt From 100,000 Views ($)Revenue Earnt From 1,000,000 Views ($)
$3$30$300$3,000
$4$40$400$4,000
$5$50$500$5,000
$6$60$600$6,000
$7$70$700$7,000
$8$80$800$8,000
$9$90$900$9,000
$10$100$1,000$10,000
$11$110$1,100$11,000
$12$120$1,200$12,000
$13$130$1,300$13,000
$14$140$1,400$14,000
$15$150$1,500$15,000
$16$160$1,600$16,000
$17$170$1,700$17,000
$18$180$1,800$18,000
Table showing the average amount of money you can earn from YouTube advertising revenue

According to Tuberlabs.com, the average number of views per video across 9 different types of videos is 5,594 views per video.

According to Social Media Examiner, they recommend channels to upload at least 3 videos per week (156 videos per year) as posting more than once per week will likely show a higher success rate on YouTube. 

If we take this into account, this would mean the average channel on YouTube could get 156 x 5,594 = 872,664 views per year on their YouTube channel.

If we round this to 872,000 views per year, this means from ad revenue alone you could earn anywhere from $2,616 to $15,696 per year from your YouTube channel.  

But there’s more to this…

You see, these are just averages based on several different niches and across millions of channels across YouTube.

There is no guarantee you will achieve these results, you could get more or less than the average.

If you combine other methods of monetisation suggested above you could comfortably earn up to 5 times the ad revenue from your channel.

Which could mean you earn $13,080 to $78,480 per year. This sees you earning an extra $1,000 a month on average.

Steps To Get Started With A YouTube Channel:

The steps you take to start your YouTube channel are quite simple and you can start them straight away.

For example, you need to understand what niche you want to get into and unlike running an agency this will have to be something you are both passionate about and knowledgable in.

As a result, this will make it worth your time to pursue and likely to continue with your YouTube channel. So, here are some steps to consider:

1)- Choose A Niche

  • You need to know about it.
  • You need to have a passion for it.

2)- Set Up your YouTube channel

  • Choose a channel name.
  • Set up channel art.
  • Set up a logo/icon if you have one.
  • Write your BIO in the about section.
  • Input channel keywords so YouTube knows what you are about.
  • Verify your account to unlock other features.

3)- Stick With One Type Of Video

  • Choose a sub-niche within your niche.
  • Create multiple videos around one specific topic.
  • Create at least 20 to 30 videos around this topic.
  • This will build authority around the subject and attract new visitors.

4)- Craft Videos For Your Audience

  • This will make it easier to reach your ideal audience faster.
  • Content ideas will be easier to create.
  • You become an expert within your niche.

List Of Niches You Can Start With:

The list of niches below, are examples that will allow you to earn reasonably high ad revenue, along with many different ways to monetise your YouTube channel outside of relying on ad revenue.

  1. Website building channel.
  2. Sports channel.
  3. Exercise regimes channel.
  4. Personal development channel.
  5. Product review channel.
  6. Tutorial channel.
  7. Makeup channel.
  8. Cooking channel.
  9. Gaming channel.
  10. Unboxing channel.
  11. Make money online channel.
  12. Social media marketing channel.
  13. Personal finance & investing channel.
  14. Photography channel.
  15. Film making channel.
  16. YouTube channel about YouTube.
  17. Cars channel.
  18. Tech & gadget channel.
  19. Bodybuilding & Fitness channel.
  20. Kitchen hacks channel.
  21. Home decorating channel.
  22. Real estate investing channel.
  23. Security systems channel.
  24. Travel vlogging channel.
  25. YouTube channel about blogging.
  26. Hair & hairstyle channel.
  27. City tour channel.
  28. DIY crafts channel.
  29. Musical instrument channel.
  30. Gardening tips channel.
  31. Healthy eating channel.
  32. Plant-based diet channel.
  33. Skincare channel.

Now, these are examples where ad revenue can fluctuate between $5 to $20+ per 1,000 views, especially on more financial related topics because companies are spending more money on these channels.

However, all these channels provide other ways to monetise your blog through brand deals, sponsorships, and affiliate marketing for various products and you can also create a blog around the idea of your YouTube channel.

As a result, this can help you earn $1,000 to $10,000+ per month from your channel if you stick with it, be patient and continue putting in the work.

Pros & Cons With A YouTube Channel:

PROS
  • This can be a good source of additional income instead of your job.
  • You can leverage YouTube for other business ideas.
  • Income methods can be quite passive.
  • A good source of traffic for your other business.
  • You can create additional business with the YouTube platform.
  • No start-up capital is required for your YouTube channel.
  • You can build a reputable brand on Youtube.
CONS
  • There is little control over your video distribution on the platform.
  • There is no guarantee that your content will be seen.
  • Over 500 hours of content is uploaded every minute.
  • Certain niches can be saturated meaning it will take longer to see results.
  • Be prepared for no results for 1 to 2 years.
  • A lot of hours go into scripting, filming, editing and optimising videos.

Final Thoughts On These Profitable Business Ideas With Low Investment

There are many business ideas you can start from the comfort of your home, with little to no startup costs. However, you must take the necessary steps to understand the industry you are entering.

The business model you choose, the clients you want to work with and the type of business you want to build will be down to your USP to stand out in a competitive market.

That’s why choosing one of these 3 profitable business ideas above will give you the fundamentals you need to consider to start, grow and scale your business over time.

So, do your research and be sure about the profitable business idea you want to start.

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