Great ideas for starting a small online business with less than £100

Thanks to the incredible advances in technology, getting a new business venture started online can be quick, easy and affordable. You don’t need an expensive high street shop, nor an office or team running a warehouse. Instead, you can take advantage of the new business models and opportunities to start an online shop, or share your expertise and passion for a topic in words or video. And best of all, you can make money from all of these and start to build up a new income.

We’ve described our favourite ways of getting started with a small online business – and each one can be started for less than £100. Yes, they need time and effort and your skills and experience, but you’ll be building your own brand and business and enjoying an incredibly rewarding experience.

Table of Contents

Is it difficult to start a new online business?

If you think there’s an opportunity to deliver better service to customers than the existing shops, or you have a niche in mind that no one is targeting, then setting up an online business could be a great way to test if this is a successful formula.

With all the advances in technology, you no longer need to be a technology whizz to setup an online shop or blog or to deliver great expert content in video or written form. There are tools and platforms – some are free and some will cost a few pounds per month – that simplify everything for you.

You can easily setup a new shop and be accepting orders and processing payments within hours. What will take longer is reaching your new customer base and marketing and promoting your new brand to an audience… this can take months or years to get right but it’s rewarding to see the number of visitors to your online business slowly growing every month.

There are plenty of great ideas for a new small business that you can launch on a shoestring – you need to do research to help you find the right topic and, of course, harness your skills and experience to start a successful project. Of course, there are risks but with the ideas we have here, although you won’t be risking too much money, you must be aware of all the other risks that come with starting a business; we’ll explain them as we go along.

Top online small business ideas that are cheap to launch

Let’s start with our top four ideas for a new online small business that costs under £100 to launch.

Setting up an online shop with dropshipping
Setting up an affiliate business
Setting up business as a blogger
Setting up business YouTube vlogging

Setting up an online shop with dropshipping

Dropshipping is a relatively new concept where you sell physical products but don’t hold any stock. You simply pass a customer order directly to the supplier who sends it, on your behalf, to the customer. You manage your brand, marketing and the payment processing but you don’t need to worry about the stock, warehousing or delivery.

It’s a quick way to get started selling physical products but it does have down-sides, especially since if there are any customer returns or queries. However, it’s a great way to test a market and launch a new brand quickly, cheaply and easily.

How does dropshipping work?

There are a few different models, but the standard way is:

Once you have decided on your niche, let’s say baby clothing, you find dropshippers who have products in this niche
You setup your online shop or website (using a platform such as Shopify or using a free platform such as WordPress and the Woocommerce add-on)
You setup payment processing – for example, setting up a Paypal account and credit card processing using Stripe
You apply to setup an account with the dropshipper
Once accepted, you add products descriptions and images to your online shop
You start marketing your site to drive new visitors who are interested in buying your products
When a customer places an order they pay you (using the payment processor you setup earlier)
You manually or, ideally, automatically send the new order to the dropshipper
The dropshipper sends out the product to the customer
You pay the dropshipper

What you need to setup a dropshipping business

You will need a computer, a website or online shop, a way of processing payments online, an account with a dropshipper, and time to market and establish your brand.

As you will have guessed, the key to this working properly is to choose a reliable and reputable dropshipping company that deals in your niche product area.

You need to be very careful about pricing, especially factoring in the delivery costs and dropshipping charges.

Once you have chosen your niche, start to review the dropshippers who operate with this type of product and look carefully at their reviews and terms.

Choose your niche and work at attracting and retaining your customers and you’ll find that dropshipping is a great way to quickly, easily and cheaply start a new online business.

Setting up an affiliate business

A simple, quick and effective way to start selling products is to setup as an affiliate. This means that you sell someone else’s products and receive a small commission a sale is made. You do the promotion and attract the customers then pass them to the supplier who completes the financial transaction, ships the products and deals with any queries or returns. The supplier then pays you the commission due for sending over the customer.

It’s a business model that has been made hugely popular with the introduction of the Amazon Associates scheme. This allowed almost anyone to sign up as an affiliate (or associate) of Amazon, include on their website lists of products stocked by Amazon and receive a small commission anytime a visitor to their website clicked through and made a purchase on Amazon.

Amazon is not the only affiliate provider – though it is the biggest – and there are companies that offer affiliate schemes directly or many use a third-party provider to manage all the technology and commission payments. There are hundreds of providers such as Awin, CommissionJunction who manage affiliate schemes on behalf of well-known brands.

For example, if you would like to sell books on your website but don’t want to deal with stock or payments, you could sign up to the Amazon Associates scheme and add images of bestselling titles on your website with a custom link back to the book’s page on Amazon. The custom link includes a code that uniquely identifies you as the source of the customer.

Other well known sites that offer affiliate schemes include Etsy, Not On The High Street, eBay, and many more.

What you need to start an affiliate business

It’s quick to set yourself up as an affiliate seller and normally free to get started. Here’s how to start:

Identify the type of product you would like to sell and find suppliers who offer an affiliate scheme
Sign up to the supplier’s affiliate scheme (either directly or, more likely, via a third party)
Once you are approved, you will receive your unique ID that you add to any links from your site to the supplier
Add in product images and descriptions on your website and link them back to the appropriate page on the supplier’s site (remembering to use your unique ID)
Check your visitor traffic using Google Analytics or other software to see how popular various products and brands are proving to your visitors
Every month the affiliate supplier will provide a report of sales and commission due to be paid to you.

Although it’s easy to setup, there are a few points to watch out for.

Firstly, you will not be alone in promoting the products – you will be one of thousands of other affiliate sellers. So you need to work on your unique brand and find products that are a good fit for your audience.
Secondly, Google does not look kindly on pure affiliate websites. It has over the last year started to penalise websites that are almost totally affiliate websites. If your site is mostly useful content with a few affiliate products, then you should be fine.
Thirdly, the amount of money you earn is likely to be very modest, especially at the start. Yes, it’s possible to build an affiliate business with tens of thousands of pounds of commission every month but you need great content, regular updates, and strong marketing.

However, as a way to help monetize your content website, affiliate marketing is simple and quick to implement so is one of the most popular ways of setting up a small business.

Setting up a business as a blogger

Blogging is all about sharing your passion with others by writing articles (called posts) that are published on your online blog or website. Visitors find your website and read your articles. It’s a very cheap business to start – with almost all the software available free – but it does take time to write and establish yourself as a known and knowledgeable source of information about your particular niche topic.

Getting visitors to your website depends on your marketing efforts and once you have started to get regular visitor traffic you can think about how best to make money from your website. There are a few options which are relatively easy to setup including adding advertising to your blog, promoting products where you are an affiliate and paid a small commission, or selling a product directly (such as an online course).

For example, if your passion is bonsai trees you might start a blog about bonsai and write about your collection, new techniques for growing and looking after bonsai, tips and advice for beginners, and photographs or other impressive collections you have visited.

Carrying on with this example, you could start to generate an income by:

Adding advertising on your website – it’s free to sign up to the Google AdSense advertising scheme (which is also used to power the adverts on YouTube) or to an alternative such as Ezoic.
Promoting products as an affiliate – for example it’s free to sign up to the Amazon Associates affiliate scheme and display products on your blog that when clicked take the visitor to Amazon and, if the person then makes a purchase you receive a small commission
Create and promote an online course which you can create and sell using specialist add-on to your blog or sell on a larger platform such as Udemy or Teachable.

How to setup a blog

To create your own blog you have three main choices:

Use your own domain name and setup a hosting account and install blogging software
Use a third-party specialist provider that manages all the software and lets you add your own domain name
Use a third-party blogging platform

Each has its own pros and cons.

Using your own domain name and setting up a host and blogging software will give you your own unique brand and total flexibility but you will have no visitors to start with so need to work on marketing, and you will need some technical knowledge.
Using a third-party provider such as Wix or Squarespace still gives you the option of having your own domain and brand and it’s much simpler to setup but there is normally a monthly charge and you will have no visitors to start with so will need to work on marketing
Using a third-party blogging platform like Medium means you normally do not have your own brand or domain and instead you have a channel on their site (rather like on YouTube for video); the huge advantage is that there is already a very large audience using the platform and your chance of getting readers quickly is increased

Whichever way you start, setting up a blog should be viewed as a way of sharing your passion and knowledge rather than a way of making money; it’s normally a slow process to build up the audience and the commercial returns are often very low. However, it’s great for an enthusiast and you can start a blog for near zero cost.

Setting up a business as a YouTube vlogger

Every minute of the day over 500 hours of video is uploaded onto the YouTube platform and, as a result, we watch a billion hours of video on this site every day. Incredible statistics and it is supported by a massive storage.

All this costs a lot to run, so who makes money on YouTube? Watching videos is free, though there is a paid-for plan. The main source of revenue for the platform itself is advertising. And it will share some of the advertising revenue with vloggers (users who regularly post videos to their channel).

If you have a specialist interest or hobby and prefer video to writing, then setting up a channel on YouTube could be a way to generate some extra income. As ever, although there are a few very popular channels and vloggers who earn millions of pounds per year from YouTube, for the majority of users it will generate just a few pounds.

So how much could you earn? Very approximately, if you have a popular channel you should be able to earn around $20-50 for every 10,000 views of a video in your channel. There are lots of variables that will push this number up (and down) – for example, how engaged your viewers are (how often they click on ads), the topic you’re covering and the type of ads displayed.

To be successful on YouTube, here’s how to get started:

Create a user account on YouTube.com
Setup your Channel and add a description and write a little about your passion for the topic
Enable your new account for monetization – you’ll find the option in your account settings
Connect your account to Google’s AdSense advertising platform – either create a new AdSense account or connect it to your existing account
Review your video criteria and ad formats – you can only monetise ‘advertiser friendly’ video topics so no nudity or violence and you must comply with copyright laws
Start posting videos. Try and do this on a regular basis, for example every Saturday morning
Setup the ad formats around your videos – you have a lot of options and choice on how to display ads around your videos (far more than with normal AdSense on a website)
Apply to YouTube to review your account, which will take a couple of weeks
Once you’ve been accepted, it’s time to work on marketing your own videos. For example, you could build links from other sources, eg from other social platforms such as Facebook, Instagram, TikTok, as well as from a blog (if you have one) or LinkedIn for business users.

What equipment do you need?

You can start with just your smart phone – if it can run the YouTube app then you can record and do basic edits to produce reasonable quality videos to get you started. Alternatively, if you have a laptop with a camera built-in, you can use this instead. As you start to develop and enhance your videos, you might want to invest in a decent stand-alone microphone, a ring-light to give you consistent lighting, and then a separate camera.

Final summary

We hope this article has given you ideas and inspiration to start a small business online; as you’ve read, starting up a new venture online without the need for stock, shipping or a physical shop or stall means it’s quick and easy to get started.

Once you have an initial idea, there’s still plenty of work required to make sure that you understand your customers, their requirements, and find the right gap in the market for your products, information or services. But this research phase is interesting and will enable you to make sure that you really do have a great business idea and can make the most of the opportunity to deliver a great service to your new customers and outshine any competitors.

Getting started takes strength and conviction in your skills and your idea – starting an online business is still a huge step to take and with a great idea, time and effort you’ll find it an incredibly rewarding experience that could quickly become hugely satisfying as well as a new source of income.