Business Startup

Starting up your Business – Practical Considerations

There are many things to consider when you first set up in business such as marketing, finance, website design, employing staff etc etc. The most important thing to consider when starting your own business is survival. To help you survive the first couple of years you will require the following

• A good business plan
• Keep up to date with the underlying accounting records
• Seek professional advice

1.Construct a good Business Plan

To set up a limited company and appoint directors and shareholders is easy, to ensure the long term existence of your company is not so easy. We set up numerous Limited Companies, Partnerships, Sole Traders etc every year but all to often we never see our client again the reason why …………. Cash flow and lack of finance. The most important thing to remember about running a business is to formulate a business plan before you start to trade. A business plan should be between 3 and 5 years long and will forecast your future requirements for cash which is the lifeblood of your business. Without sufficient cash resources you cannot afford to buy stock, pay employees and even pay yourself and eventually you will not be able to trade.

A business plan should also investigate your market sector including identifying competition and any potential risks.

A Business Plan will in general consist of the following.

• Balance Sheet
• Profit and Loss account
• Cash Flow
• Competitor Analysis
• Market intelligence

If you require any Bank finance a Business Plan will be required.

2.Setting up your accounts system.

Depending upon the size and complexity of your business it is important that from the very start you have a good accounting system for recording all your transactions. From a sole trader with a small turnover to a Limited Company who has a turnover in the millions the same principals apply in so far as they must accurately record and account for each transaction that goes through their business.

Some business’s prepare their own books others require the assistance of accountants to prepare the books and make all the statutory declarations. However which ever option you choose we strongly recommend that all transactions are recorded accurately on an excel spreadsheet or an approved accounts package such as Sage – time is a precious commodity and bad accounting records will waste more of your valuable time in the long term.

3.Seek Professional Advice

It seems an obvious thing to say but all too often the only time that we see clients is when they are in some kind of trouble with their finances or with the authorities. We strongly recommend that you seek professional advice before you start in business , it may cost you some money in the short term but in the long term you will be glad that you did.