You may wonder whether you ‘have what it takes’ to set up a new business, but the truth is that everybody has it. What makes the difference in turning the seeds of an idea into a successful business is having the drive and determination to persist with it, but also putting the planning in and making key, informed decisions at critical early stages.
Research your idea
Brainstorm with friends and family, assess your target market, make sure there actually is a market for your product or service. Then check that your idea is ‘future proof’, ie. can it grow and evolve? Are there ways you can expand the business or the product range so that it not only survives but prospers?
Business structure
Before you set up a new business you need to decide on what form your business will take. This may seem obvious from the outset but there are various options. Are you a self-employed sole trader or freelancer? Are you forming a partnership or could you form a limited company? Of course the business structure can change as it grows, but getting it right at the beginning is key to your immediate financial health.
Branding
The name, the logos, the image; they can make or break a business, and how you want your business to be perceived by the market is more important than ever. Having a strong brand that can be transferred easily to a website and connected visual mediums can be a huge factor in your success. The branding forms part of your intellectual property and this may need protecting and Jonathan is well placed to advise you on this.
Finance
How are you funding your business? How far ahead can this initial funding take you? Are you being realistic? Some professional advice will help you plan for launch and that initial uncertain period, and making the right decisions now and not over-stretching the business will help in the long term.
The business plan
An essential part of any fledgling business is this document that defines the structure of the business, the market analysis and strategy and makes financial and sales projections. You will have thought about much of this already of course, but putting it together in a document is key to being a credible business and being taken seriously by banks and any industry personnel.
Looking after the books
You might feel that you can do all this yourself, and in the early stages this might be true, but as the business grows you may need to appoint an accountant to do your book-keeping, tax returns and look after national insurance. These are aspects of running a business that you simply can’t afford to get wrong, and depending on your industry there may be regulatory requirements that you also need to consider and enlist professional help with. Jonathan works regularly with accountants and has significant experience in finding the most appropriate one to assist you.
Resource planning
What premises do you need to set up a new business? Can you work from home? If so do you have enough office space and is your Wi-Fi reliable and fast enough? Do you need retail space? Have you factored fixtures and fittings or IT equipment into your financial planning? There are also initial costs for website domain names and website development that need to be considered, and of course capital may be required for stock and materials.
Marketing
Social media is an increasingly important method of reaching out and connecting with your market, so you need to consider this along with the more traditional marketing topics of pricing structures, product lifecycles, sales locations, brand awareness and advertising. Again, a lot of this will be considered from the outset and will form part of your Business Plan, but can you handle social media yourself? Could a partner or family member look after that initially so you can concentrate on the day-to-day running of the business?
Planning ahead
If all goes well then the first few months of running a business will be a whirlwind where there aren’t enough hours in the day. This may seem enjoyable and everything you ever wished for, but you need to remember key actions and dates that are crucial to the business. So set up a calendar, diary or checklist that notifies you of standard, routine things such as payroll, stock checks, stock ordering, updating the website, tax returns and social media updates. This list will be extended to things unique to your particular business, but in essence, don’t lose sight of important things by getting too immersed in the everyday running of the business.
Set goals
It may feel like you are successful simply by turning over money each week or month, but it is important to set targets and plan towards meeting them when you set up a new business. A company can’t afford to stand still and your business plan should include short, medium and long-term goals as well as a mechanism to stop and review progress at regular intervals. This will allow you to consider where you can cut costs, amend strategies and set new goals where appropriate. It is important to be cautious, conservative and realistic when setting goals, but you should also balance this with setting yourself challenges.
Jonathan Finn is corporate solicitor at Ison Harrison.
Further reading on starting a business
