The tightening jobs market, with its ever-shrinking number of positions, is playing a role in increasing numbers of fledgling entrepreneurs setting up their own businesses. Due to such competitive markets, it is vital that those joining the ranks do so with clear ideas, knowledge, and the drive and ambition to make their vision a reality.
You’ll first need to come up with an idea that you can turn into a product or service. You may already have one, but if not, you might find that you need to be a little more imaginative than you first thought; after all, with so many companies being set up each month, it shouldn’t come as a surprise if you find your business concept has already been used.
To grasp how consumers are going to react to your product or service, it is vital that you carry out some market research. This step doesn’t have to be strenuous, time consuming or cost the earth; it does, however, have to take place!
Today’s small business field is crowded and highly competitive. In order to have a competitive edge, businesses must find their unique selling point. Consider areas such as:
Product/ services: Is your product unique? If not, what makes it better than what is currently on the market?
Company name/Logo: A catchy name and logo can make all the difference. Be unique and imaginative, but not s
o bizarre that people won’t remember it. Register your name with Company House. You can also use the site to search current business names to make sure the one you want isn’t already in use.
Having an online presence enables you to make your business as accessible as possible to customers, allowing them to browse and buy your products and services 24 hours a day.
Producing a website is one of the best ways to give your business a head start. It helps you to explore your market and is fantastic for spreading the word to as many people as possible. You don’t need advanced programming skills to create a website, but if you felt the need to, you could always outsource your web design work.
Design: Is it eye-catching yet professional? Make sure the layout isn’t too busy, but consists of clear and concise information.
Booking/Payment Tool: Don’t forget to make any booking or payment process simple; anything too slow or advanced will put potential customers off.
Provide contact details: Provide clear and up-to-date contact details. As the internet grows so do consumers concerns regarding validity of businesses. Not having clear up-to- date details may lose you potential customers.
Keep it updated: Keep all content current so as not to cause ordering issues or misunderstandings.
Sites such as Facebook, Twitter and Blogs, are becoming increasingly popular tools for businesses. Their main benefits are that you can contact thousands of consumers at the click of a button and have your customers do your marketing for you through word of mouth. The basis for social media are Facebook and Blogs, so perhaps get involved in these first until you get the hang of how things work.
Identify Likely Business Costs
Marketing: Factor in costs such as marketing research, website domain, business cards and logo design.
Running Costs/Stock: Don’t forget the cost of buying in stock, as well as running costs such as paying an internet provider or renting business premises.
Accounts: It is highly likely you will need to use the services of an accountant at least annually, so factor in the cost of this too.
You may be eligible for help such as Government grants, loans and business support in the form of a mentor and consultancy. You may also be eligible for help via business support schemes such as the initiatives offered by the DTI. You can find out what you are entitled to by contacting your local Business Links Office.
When starting a business you will need a dedicated business bank account. Many overlook the importance of this, but no matter how small your company may be, it is highly recommended to find and set up the best small business bank account you can to suit your business requirements. Making use of a bank account for your business enables you to arrange your business more efficiently by allowing you to keep track of the money you are spending and making. It also enables you to keep your individual finances separate from those of your business, which will in turn help to ensure that financial errors don’t occur. It will also make it easier to complete legal processes such as self-assessment tax returns. You may additionally find that if you are entitled to grants or other funding, the suppliers of the finances will require you to have a business bank account in place into which they transfer the funds.
Many small businesses comprise of just a single person, termed as being a ‘sole trader’. If this is applicable, you will be classed as self-employed, meaning that you won’t have a boss other than yourself! It also mean you will hold responsibilities such as looking after your company’s administration and finances and taking a gamble with your own cash, especially if you’re leaving paid employment completely.
You might find that by having a business partner you are able to spend more time doing what you know best within the company, thus making it more likely to succeed. It might be an idea to think about working with a number of partners to form a team. This will allow you to share responsibilities including risks, obtaining funding and expertise.
A limited company is an administration that you can start up to manage your business. It is independently responsible for everything that it does and its finances remain separate to personal finances. All limited companies have ‘members’ – individuals or companies who own shares in the business. Directors take responsibility for running the company and will often have shares in it, but this is not essential. Limited companies are in charge of paying Corporation Tax and there are numerous legal responsibilities associated with the role of director and managing a limited company.
All businesses will require suppliers in some shape or form, so whatever your needs, it is important to work closely with them. Consider the following:
Prices: Make sure you negotiate; suppliers will often enter talks with overly inflated prices.
Develop relationships: Your suppliers are going to play a big part in your success; because of this it is vital to build a good business relationship.
Agree on payment terms: Get payment terms in writing. This includes terms such as your ‘trade credit’ period (how many days you agree to pay invoices within).
Once your business is established you may want to think about ways to expand.
Things you can do to help grow your business include:
Improve your current product/services: Research how your current products and services are performing and look at ways of improving them.
Introduce new products/ services: Look at gaps in the market that you might be able to fill.
Hire staff/expand premises: If your business has a retail outlet perhaps look at expanding it or opening another premises.
Funding: Look into additional sources of funding. This could help you to expand in areas you didn’t previously think would be possible.
Develop yourself: Consider training courses or qualifications that might help you in the process of running and growing your business.
Remember your business is only as good as your people. Whether that is just you, your partners or a whole array of different staff, it is important to take time to ensure each step of creating your business and all aspects of running it are carefully planned and carried out. This in turn will help make the process simpler, less time consuming and ultimately a fun experience!