Get your business off to a flying start

Starting your own business is always exciting because you are the one who decides how to shape the business. Everything from the name on the door or website, through to the way the business looks and promotes itself is within your power to decide. This is the time to plan carefully and get expert advice to help maximise your chances of success.

Step 1 – Do some research

Why are you starting in business?

Research your market

Create a strategic plan for your business

Learn from others

Step 2 – Think about your business plan

What is your business going to do and what are you providing?

Who are your customers and where is your potential market?

Who is your competition?

How will you run your business?

How will you fund your business?

What help will you need?

Why are you starting in business?

Most people starting up a business have a goal in mind. Of course with success will come new goals but here are a few thoughts to help you set that key goal which will be the catalyst for your future success:

  • To make money
  • To be my own boss
  • To satisfy my personal ambition
  • To spend more time with my children and family
  • To do something I have a passion for
  • To share my great idea with the world
  • To work from home

As you start the ball rolling it’s easy to become swamped. So try to make sure you remember your goal as a part of your plan and review it regularly. And if you feel the goal needs to change – then make the change.

Research your market or get someone to do it for you.

You’ll need to find out if your business idea will work and that means doing research – a lot of research. Try and bounce ideas off friends and family as well as possible networking which can help with ideas and suggestions on your business ‘free of charge’.

Do you need help to understand the market?

Is it growing?

Are there long-term opportunities for small businesses in the market?

How is the market changing – is your idea “future proof”?

Can you beat the competition?

And if you can’t beat them can you outwit them? Think about

  • How much competition will you face?
  • Has someone else already developed your idea?
  • How is your idea original or better than those from your competitors?
  • What are they charging? Do they give offers to new customers?
  • What don’t they do very well? Does this mean you could win over their customers if you did it well?

Creating a strategic plan for your business

It’s a great idea to create a SWOT analysis. What’s a SWOT? A clear, honest, well-researched set of Strengths, Weaknesses, Opportunities and Threats about you and your business. It’s a good place to start for most business plans. Lay it out simply as shown below:

 

StrengthsFill in all the strengths of your idea, you or your workforce. Think about questions like

  • What are you best at?
  • What’s unique about your idea?
  • Is your product or service unique?
  • Do you have access to a skilled and innovative workforce?
WeaknessesWrite down your weaknesses, or areas where you think your business might be exposed. Ask yourself:

  • Do your employees need to be trained?
  • Do you have enough resources like people, money and assets?
  • Will you provide strong leadership?
  • Will your marketing make your idea stand out from the competition?

 

OpportunitiesThese are factors that will define how successful your business could be. Note down your thoughts on things like:

  • Is there an existing demand for your idea?
  • What niches do you know of that your competitors missed?
  • Is there room for a new business?
ThreatsThese are the threatsto your business.Think about these:

  • Could new competitors come into your market?
  • When will your product/service go out of date?
  • Are you based around a high concentration of competitors?
  • Could your customers pass you by and go directly to your suppliers?

 

Now that you’ve got your SWOT, spend time thinking about how you are going to make the most of your positives, fix your weak areas and combat the threats. Build your decisions into your plan and back them up with strategies designed to make your business a successful enterprise.

Learn from others

Just because you are going into business on your own doesn’t mean you can’t learn from others. Why not talk to people you know who run a business, or perhaps even ask local business people for a short meeting. You’ll also find many books by successful entrepreneurs.

Here is a list of ten tips:

  1. Think long and hard before taking the plunge
  2. Consider working two jobs while you become established, to help solve money worries
  3. Spend time researching the market, your competitors, potential clients and customers, etc.
  4. Write a professional business plan – and try to update it regularly
  5. Get professional advice from business support agencies, as well as accountants, solicitors etc.
  6. Talk to people about your ideas and plans – never miss an opportunity to network
  7. Set up a website and email address straight away – many people will rely on the Internet to find you and it looks more professional
  8. Try and secure as much press coverage and interest locally through a marketing push to announce that you’re in business
  9. Stay positive and enthusiastic – what could be better than being your own boss and doing something that you enjoy?
  10. However busy you are, always remember to take some time out – take a weekend off from it all or even just have a bath and chill out at the end of the day.

Build your business plan

Now that you’ve learned so much about your competitors, yourself and your idea, it’s time to start planning. These are areas you will need to think about.

What is your business going to do?

What’s the big idea? What are the fundamental aims of your business?

Who are your customers?

Be clear who will be buying from you:

  • How will they hear about you?
  • Do they currently buy the product/service you have and what do they think about your alternative?
  • Why will they buy from you and no one else?

Who is your competition?

How much competition is there? How is what you do going to enable you to win over the competition? Find out who the competition is – ask around, look in Yellow Pages and on the Internet. Next, phone them up or look at their websites/premises/brochures. What are they like? How much do they charge? What’s different between them and what you are going to do?

How will you run your business?

What’s in a name?

The name you choose for your business will put across the kind of image you want your business to have.

Tips on choosing a name:

  • Make sure it’s easy to pronounce and to remember
  • Pick one that doesn’t already exist – check your local directory or search on google.co.uk
  • Run your options past your friends and family
  • Imagine how it will look on your business cards and stationery
  • Make sure it is available as a web address

Location is everything

So, you have got a well-researched plan and have funding in place to turn it into a reality. Now you need to decide where would you like your business to be located.

Working from home

This could be the easiest and least expensive option. But you’ll need the willpower to resist distractions, and you’ll need to make sure there are no restrictions from your mortgage provider, insurance provider and local authority.

Setting up outside of home

  • Make sure it suits the purposes of your business, e.g. do you need to be in a main shopping location? Do you need plenty of storage space?
  • Consider if your customers need to be able to park outside
  • What’s the passing trade like?
  • Look out for competition in the area
  • Check whether any grants are available in the area you choose
  • Get legal advice before you enter into any agreement to rent or buy
  • Get advice from a solicitor or accountant on issues such as health and safety, planning and tax

New or existing?

  Pros Cons
Starting from scratch
  • Can be extremely satisfying
  • Freedom to do what you want
  •  No one to bounce ideas off
  • More work for you to do at the outset
Buying an existing business
  • You know it’s past history
  • You already have a customer base
  • Need to spend money up front to buy the business
  • Reputation can be good or bad
Buying a franchise
  • Support and reputation of an established company behind you
  • You are your own boss
  •  No freedom to change the product or service
  • Can be tainted by bad publicity around other franchises
  • Can be very expensive

 

What form of business?

Sole trader

This is a business owned and operated by one person. You might employ other people, but the business and the risks are all yours – as well as the profits. Most small businesses start in this way. It is simple and easy to set up. If you start working for yourself, you must register with the Inland Revenue as self-employed. Call their helpline on 08459 15 45 15. You should register the moment you start out as a sole trader, otherwise you could incur a financial penalty later.

Partnership

Getting other people involved in your idea means all the costs, risks, profits and responsibility are shared between the partners. It is important to ask a solicitor to draw up a partnership agreement. A partnership has no legal status (unlike a limited company – see below) it is merely a vehicle linking two or more self-employed people in a simple business structure. A limited liability partnership is similar in some ways to a standard partnership, except that the individual members have lower liabilities for any debts which may arise from running the business.

Limited company

Setting up as a limited company means you won’t be personally responsible for your business debts, as a company is a separate entity from its owners. It can be better from a tax perspective and you can pay yourself a salary. You’ll need to register as a company with Companies House and submit regular financial statements. For more information, visit www.companieshouse.gov.uk

How will you fund your business?

Work out how much money you’ll need to get your business going. If you need financing, you have several options ranging from grants, loans or even money from friends and family. You also need to think about your bookkeeping – will you do the accounts yourself or will you use an accountant?

Top tip

When you write your business plan, remember to:

  • Be clear and realistic about your goals
  • Keep it short and to the point
  • Use research to back it up
  • Include an action plan
  • Ask someone to check it over
  • Be prepared to adjust your plan as your idea develops

Hiring staff

You may not need staff, bit if you do take people on – even part-time, you’ll need to be familiar with employment law. However, you may well consider using a virtual office service such as Business Visions to ensure you have the administration and support needed not only when you start your business, but as your company grows.

So that’s it …

The biggest causes of failure for start-ups are:

  1. Setting your sights too high
  2. Not researching your market thoroughly
  3. Hiring the wrong staff
  4. Not putting enough funds aside for contingency

No matter how good the original business plan, unexpected problems will arise. So expect them and be ready to solve them quickly! If you have done your background work and have a good team around you and a firm grip on your money you’ll be in a good position to deal with problems and go on to run a successful business.

So here are our tips for surviving the first year

  • Put together a financial plan with help from an accountant if you can that covers budgets and sales forecasts. Include a personal financial plan
  • Protect your business and your investment with the right level of insurance. It’s taken a lot of hard work to get it going, the last thing you want is to lose it.
  • Make saving a priority before you start
  • Keep costs to a minimum. It’s easy to shop around for cheaper deals on your expenses
  • Understand the difference between cash flow and profit. Monitor cash flow each week, but wait until the end of the year to calculate your profit
  • Take on a second or part-time job that doesn’t interfere with your business until it is established
  • Stick to your budget – no matter what

We wish you the best of luck

and if we can help in any way please do let us know