Rear derailleur does not shift down
Detach the cable at the derailleur and see where the derailleur sits. If its not in line with the lowest cog you need to adjust the lower limit screw. This is usually marked with an L. Screw it out until the top jockey wheel of the derialleur is precisely in line with the smallest cog. Reattach the cable with shifter on gear 1. Then click up one gear. Adjust the tensioner on shifter and/or derailleur until jockey wheel is precisely in line with second cog. 

Finally shift all the way to the top cog and screw the high limit screw until you just feel resistance. This stops the chain going too far and dropping into your wheel.