However you’ve reached your decision to take the plunge and start your own business, you need to go in with your eyes open – there are certain things you need to do to make sure you stand the best chance of success.
1 – What’s your big idea?
- Research – check out the competition
- Gap in market/ do something better/ differently
- What’s your differentiator? Customer service/ new product/ delivery times. Can you describe it to a potential client in 20 seconds (elevator pitch)?
- Do you need to register any IP/ patents/ trade marks?
- Use free resources – https://www.gov.uk/business-help
2 – Business basics
- What are you going to call yourself? Registering with Companies House
- Limited company vs. sole trader
- Do you need to register for VAT/ corporation tax?
- Business bank account
3 – How much money are you going to need and where is it coming from?
- Are you going to rely on savings?
- Funding options
- Steady stream of income – some people keep their 9-5 job whilst getting their business up and running to maintain income
- Credit score – if you need to borrow money how much can you raise and what will it cost you?
- What expenses will you have?
- Late payments
4 – What’s your plan/ strategy?
- Your business plan sets out where you want to go and how you will get there – writing it down will highlight any potential issues and barriers to success. It will give investors confidence in your ability to deliver and keeps you on the right track.
- But be flexible as it will need to change
5 – How much are you going to charge?
- Really important to get this right from start – if you win business based on being cheap then harder to put prices up
- Research market rates
6 – How are you going to market your company?
- Where are your customers and how are you going to reach them?
- Most people using their expertise they’ve gained at previous employer – can you use your network to spread the word
- If you’re going into a new area that you haven’t worked in before, how are you going to build contacts? Local networking/ trade groups
- How are you going to create your website?
7 – How will you deal with the tough times?
- No sick pay/ holiday pay
- Although you may have an inspiring mission statement this can quickly be forgotten as you wade through day-to-day bureaucracy, accounts, marketing, chasing suppliers etc. To start with you are your own IT help desk, accounts department and HR manager (unless you outsource some or all of these functions)
- Need to keep motivated
8 – Which rules and regulations will impact you?
- What insurance will you need?
- Are you employing staff?
9 – What advisors do you need?
- Chambers of Commerce
- Talk to fellow entrepreneurs to learn from their mistakes – especially those in same industry
- Take on the advice you need, but without paying for a service you don’t need
10 – What if things go wrong?
- How are you going to protect and backup your IT systems? Small businesses are susceptible to cyber attacks because they don’t have the security of larger companies
- Alternative suppliers lined up
- Customer complaints – how will you deal with them?