BUSINESS START UP – THE ULTIMATE GUIDE
Starting your own business requires plenty of commitment and dedication, but if you have a good idea, set your business up well and look after it, there is no reason why you cannot be successful. This article outlines the most important aspects of setting up a new business.
If the business is to have any hope of being successful in providing a product or service that customers are willing to buy, it is essential to gather comprehensive information about both your potential market and about the competitors for business in your market. This will help you to develop a Unique Selling Point (USP), that will make your business stand out, and to discover the best way of getting your product or service to market.
Secondary Research is an examination of information that is already in existence, some examples are; studies and reports completed by government agencies, other businesses or trade associations.
This is the gathering of information directly from your Target Market to find out as much information as you can about them. Primary research can be done by questionnaires, surveys, interviews, observation or focus groups.
2 .BUSINESS PLANNING
Every business needs a plan “fail to plan, plan to fail”, A Business Plan is necessary if you will be seeking external finance from any source, (bank loans, enterprise funds, government grants). A business plan will also help you to remain focused and monitor whether you are on track with meeting targets that you have set for your business.
A good Business Plan should contain;
- Background details about you and your business,
- Results of market research done,
- Details of how your business will be managed.
- Information about your financial status, show where the money for the business is coming from.
- Cashflow and business analysis and projections for the short, medium and long term.
There are numerous free business plan templates available https://www.gov.uk/write-business-plan.
3. SWOT ANALYSIS
It is advisable to complete a SWOT analysis for your business before you start. This is an examination of the STRENGTHS, WEAKNESSES, OPPORTUNITIES AND THREATS for your business. https://www.nibusinessinfo.co.uk/…/swot-pestle-and-other-models-strategic-analysis. A detailed swot analysis will put you in a better position to both predict problems and take advantage of possible opportunities as they arise.
4. FINANCIAL PLANNING FOR YOUR BUSINESS ( INCLUDING INSURANCE, AND TAX)
Financial requirements for a business fall into three categories, short- term, medium-term and long-term.
Finance may be needed for ; premises, stock, website building and hosting, office equipment, general running costs(phone electricity,internet), marketing and advertising, insurance.
Sources of Finance include; Self Funding, (including support from friends and family), Business Start-Up Loan, Overdraft, Credit Card, Crowd funding, outside investment.
Evaluate all of the financial options to make sure you are getting the best deal, most suitable for your purpose.
Business Bank Account
It is advisable to set-up a separate bank account for all business transactions so there is no confusion with your personal finances.
Insurance is essential in order to protect your business. Your premises, vehicles,goods and income need to be protected, as well as public liability, professional indemnity and any industry-specific insurance you may need.
When you start a business, it is necessary to register with HMRC for tax purposes Tax liabilities may include Corporation Tax, PAYE, VAT, and self-assessment. Information about tax requirements and liabilities can be found at https://www.gov.uk/topic/business-tax/self-employed.
Bookeeping and Accounts
In order to keep your financial affairs in order, it will be necessary to have a system of accounts and bookeeping for your business. If you decide to do this yourself, there are a variety of software packages available to you. However, it is advisable to consult with a professional such as an accountant, who has the skills and experience to ensure you are running you business in the most cost effective way.
5. BUSINESS STRUCTURE
When starting a business there are a few options open to you as to what the legal structure of your business will be. Research all the options carefully to work out which one is best for your business.
Sole Trader. It is relatively easy to set up as a sole trader. You register as self-employed, you are responsible for self-assessment of your tax. You get to keep all the profits of the business once your tax is paid, but remember you are also solely responsible for any financial loss in the business. You can also set up in this way with another person and the business is then known as a Partnership.
Limited Liability Partnership – This differs from a partnership as described above, in that in a Limited Liability Partnership, the partners are not responsible for losses in the business.
Limited Co. In a Limited company structure, the company is a separate legal entity from the people who set itup. It has a separate financial and legal status. Company registration is necessary for a limited company. In order to register your company, the business must have –
- A Name and Address
- At least one director
- At least one shareholder and details of company’s shares must be provided
- The company must have a set of rules which will govern it these are known as Memorandums/Articles of Association.
When all this is completed and available your company is ready for registration.
Details available at https://www.gov.uk/limited-company-formation/register-your-company.
Some business require particular permits or licenses to operate information about this can be found at https://www.gov.uk/
6. CREATE A BUSINESS IDENTITY
Choosing a name for your business is an exciting and important step. Take plenty of time when choosing the name, brainstorm, write down everything you can think of that is related to your business, including the demographic of your customers. Consult with others, get as many ideas as you can, out of this process a name that you are happy with will eventually arise, be patient with this step.
If you are conducting business on line, you will need to take Search Engine Optimisation (SEO) into account when deciding a name for your business. It is advisable to use words that identify what your business is about, so that when potential customer puts a key word or phrase into the google search bar, your business will be more likely to come. It is worthwhile spending some time learning about SEO strategies. https://www.business2community.com/seo/beginners-guide-local-seo-strategies-small-
When you have your name picked, check the company registration list at the Companies House to make sure it is not already being used, also ensure that the domain name is available to you for setting up your website.
Logo and Branding
The same considerations need to be taken into account when choosing a logo as a name. If you can, do some of the design of your logo yourself to help keep costs down; though, you will probably need professional help of a graphic designer to refine your logo. it is usually more cost effective to work with a small local company when designing your brand.
Your logo will be used on all of your business stationery and on your website, so it needs to striking and memorable.
The website will need to look professional and operate seamlessly to create a positive impression of your business. The cost of setting up a website may be considerable but it is essential . If you are selling online, you need to be aware of data protection laws so that personal information given by customers is safe. It is also essential to ensure your site is secure for financial transactions.
7. LABELLING AND PACKAGING
There are legal requirements for labeling in many industries e.g If you are selling food items, all ingredients will need to be clearly listed on the label, if you are selling toys or children’s goods, the label will have to show that the required safety standards are being met. You will need to know the labeling regulations that apply for your type of business.
Packaging of products,can be expensive, so this is an area that should be well researched in order to gain value for money, if you are going to be delivering items to the customer, packaging needs to be as light as possible to keep down costs. There are also government regulations around the amount of packaging you can use, . Comprehensive information about packaging for different industries can be found at; https://www.gov.uk/weights-measures-and-packaging-the-law.
8. BUSINESS LOCATION
It is essential for the success of your business that it is situated in the right location, there is no point having a great business if you don’t have customers. If you need a bricks and mortar shop, ensure that the area has a high footfall of passing customers, research the area, talk to other business people, consult with estate agents, visit the area.
If your business is going to be online, where will you store your stock consider how much space you need, does stock need to be protected, e.g. from damp conditions. Do you need an office space or can you work from home to keep costs down?
9. SOURCING STOCK
Do plenty of research before deciding on a supplier or manufacturer . Compare prices and quality of products, find out minimum orders and what discount policies apply for larger orders. Get samples of products.
If importing stock, you will need specific information about how long transit of goods will take, this can be significant from countries such as China. Allow for delays caused by outside forces, e.g weather or a postal strike.
If your business is seasonal, you will need to know how far ahead you need to order to ensure delivery in time.
10. PRODUCT DELIVERY AND RETURNS
If you are selling goods online, consider whether it is more cost effective for you to send goods via the normal postal service or a delivery company. You will also need to have a clear returns policy for your goods that meets legal requirements.
There are many other legal aspects related to starting a business, some of the main ones are;
Data Protection; This applies to all information you gain about your customers and is particularly important if your business is online as information can be stolen by hackers if not protected properly. https://www.gov.uk/data-protection
Money Laundering Act; Some businesses are required by law to ensure against moneylending, information about this can be found at; https://www.gov.uk/anti-money-laundering-registration
Intellectual Property ( IP) IP Law applies to patents, trademarks and copyrights and can be used to protect your name, logo, ideas and designs; https://www.gov.uk/government/organisations/intellectual-property-office
12. HUMAN RESOURCES
If you will be employing staff in your business, you will need to give careful consideration to job specifications and interviewing, to ensure you get the most suitable staff. You will also need to educate yourself about employment law.
You must register with HMRC as an employer, you will need to be aware of relevant health and safety legislation. You will need to set up payroll, organise tax and pensions and to insure your employees. Detailed information can be found here; www.acas.org.uk/index.aspx?articleid=2949
13.ADVERTISING AND MARKETING
Advertising and Marketing is very important, customers must know that you exist and where to find you. Your advertising and marketing strategy will depend largely on the market you are trying to reach, it would be a very different marketing strategy for a local market compared to a the global market online.
One of the most cost-effective ways to market your business is via social media accounts. A Strong social media presence is an effective way of reaching large numbers of potential customers. If you are using social media, make sure the links on your website are active and that you regularly update your posts in order to keep your customers engaged.
If you plan well, work hard and think smart, there is nothing stopping you from becoming your own boss and a successful entrepreneur. Good Luck.
Kizzi Nkwocha is the editor of Business Game Changer Magazine and publisher of The UK Newspaper, Money and Finance Magazine, the net’s fastest growing wealth creation publication. Kizzi Nkwocha is chair of The Ethical Publishers Association and co-chair of The Logistics Association. Kizzi made his mark in the UK as a publicist, journalist and social media pioneer. As a widely respected and successful media consultant he has represented a diverse range of clients including the King of Uganda, and Amnesty International. Nkwocha has also become a well-known personality on both radio and television. He has been the focus of a Channel 4 documentary on publicity and has hosted his own talk show, London Line, on Sky TV. He has also produced and presented both radio and TV shows in Cyprus and Spain.