You have made the big decision to start your own business. How exciting! But now you are feeling overwhelmed by all the things you need to do to get your business off the ground.
Impetus4’s definitive checklist will walk you through the key things you need to think about and get done before you start trading.
Download Impetus4’s FREE Starting a Business Checklist
TYPE OF BUSINESS
Part-time – By setting up a part-time business you can work it around other commitments such as children. You could even set your new business up as a side-hustle to start with, allowing you to continue with the day-job and the financial security it brings with it.
Franchise – Buying a franchise is a great way of running your own business with the benefit of training and the backing and support of a big brand. However, the cost of buying a franchise can be high.
Buy a business – Again, the initial cost may be relatively high if you buy an existing business, but it’s likely all the equipment and systems are in place and if you do your due diligence you will have a very good idea of the business’s profitability and prospects for growth. This can be a low-risk way to start your entrepreneurial career.
Start-up – This can be as simple as a computer and a desk in the spare room or premises with a team of staff. If you are starting up as a solopreneur, costs can be kept relatively low, but you are on your own and your business success depends solely on your decisions.
If you decide to go down the route of starting your own company you will need to decide on what legal structure it will have.
Sole Trader – Self-employed individuals who have personal liability for all business debts. You will have to register with HMRC and pay Income Tax and National Insurance on your earnings at the end of every tax year. You will be responsible for preparing a Self-Assessment tax return to report your annual income and tax liability.
Limited Company – They can be owned and operated by one person or multiple people and must be incorporated at Companies House. A limited company exists as a legal ‘person’. This means they are responsible for their own liabilities. The owners of a company are protected by limited liability. They are not personally liable for business debts other than what they agree to contribute to the business.
Limited Liability Company (LLC) – A great structure for accountants and other types of professionals who want to run a partnership with other people. You need at least two people to set up an LLP. This type of business structure is very similar to a normal partnership in terms of ownership structure and taxation, but it provides limited liability to all partners.
You can find more information about the different type of legal business structures at the gov.uk website.
Before diving in and spending money on your new business you really need to do some in-depth research into whether or not there is a market for what you intend to sell. This time will definitely not be wasted and the information you gather will form an important part of your Business Plan (see next).
You need to assess the viability of your business. What other businesses exist in the marketplace? How are they doing? How can you do things better? Is the market for your service/product growing or dwindling? Who are your customers? How will you reach them? You can use online and real-life surveys or focus groups to help you come up with the answers these questions. Also, ask your family and friends for their honest opinions.
This is a crucial part of your business set-up process. Even if you don’t need it to secure funding from your bank or other investors, the act of creating your business plan focuses your mind on what you really need to know about your business, such as how much it will cost to run and how much money you can expect to make. As part of the process you will look at your business’s mission, its’ competition, potential clients and how you intend to market it. There are a many good templates available to get you started, including Impetus4’s Business Plan Guide.
Choosing a name for your business may be a piece of cake or it may be an agonising game of brainstorming, loving, hating, sleeping on and starting over. Either way, the name of your business is a very big deal and needs some careful consideration as, alongside your logo, it will form the crux of your business’s brand identity. Have a look at Impetus4’s What’s In A Business Name? Make the right decision for your start-up for more help.
Once you have chosen your legal business structure and registered your company at Companies House, you can open up a business bank account and start planning your business finances. It is advisable to have a bank account for your business which is separate to your personal account.
You also need to think about:
Financing your start-up – Most businesses have some start-up costs associated with them, such as buying computer equipment and software. Think about how much you will need to cover all your costs, including paying yourself a salary. There are a number of ways of securing investment, such as borrowing from friends and family, overdraft or credit card, bank loans, investors or even crowdfunding, Be realistic about what you will need and clear about how and when you will pay and borrowed money back.
Book-keeping, invoicing and cashflow – Once your business is up-and-running you will need to be on top of keeping track of your finances. This includes invoicing clients, paying suppliers and everything else that is coming in and going out of your business. There are many affordable and easy-to-use invoicing solutions available.
You will need good records at the end of the financial year for tax returns and filing accounts with Companies House. Seriously consider hiring a professional accountant.
The choices you make about your brand will affect the way people perceive your business. As well as your business name, branding is all about your company logo, choice of colours, the typefaces you use and even the “tone of voice” you use in your content.
Logo Design – There are countless apps and software that enable even those with little creative flair create a passable logo. Do a bit of research, take inspiration from logos you like, consider how colours affect people’s perception and then give it a go yourself.
If you don’t want to (or can’t) create your own logo, Impetus4’s Tracey Sweetland offers design services over at her personal site http://www.traceysweetland.co.uk
Every business needs a website. Period. If you don’t believe me, read this. A website is often the first port of call for anyone looking for your type of business or more information on your business. Domain names and hosting packages are relatively cheap and content management systems such as Wix and WordPress mean it is within most people’s reach to set up a perfectly adequate website for most types of business. You can sign up for Impetus4’s WordPress website building course. The course will launch in October and if you sign up now you will receive a 10% discount.
If you don’t feel confident about building your own website, pop over to traceysweetland.co.uk for an affordable website design service.
Need help with your website, branding and social media?
Get affordable and effective help from traceysweetland.co.uk
Social Media is huge and it’s not going away anytime soon, so you need to embrace everything it has to offer to help you get your fledgeling business off the ground.
As you start pulling everything together to launch your business, now is the time to ensure you can secure profile names that match your business name to ensure your customers can find you and to start to build a brand identity.
It’s best to pick just a couple of networks where your ideal customers hang out – be it Facebook, Twitter, LinkedIn, Instagram or elsewhere – and focus on them as social media can take over your life if you let it.
Spend some time creating profiles on your chosen networks that showcase your business in the best light and consider using the same profile picture across all platforms to start building recognition. This should be your logo or a high-quality professional head and shoulders shot of you.
If you are not convinced about the need to get involved with social media for your business, read this – Ignoring ‘social’ could mean the cold shoulder for your business.
Once you launch your business, it is important to keep your website and social media up-to-date and post relevant content regularly to build the relationship with your potential clients and boost your rankings on search engines.
Presumably you know by now what your business will need in terms of a ‘workplace’. If you are going to be a solopreneur, maybe a desk in the spare room (or even the corner of the kitchen) will be sufficient, but if you are launching a retail business or will have a team, you will most likely need premises.
Finding suitable premises can take a considerable amount of time, depending on your needs, so it’s important to give yourself a head start. Hopefully you will already have investigated the cost of the type of premises you need as part of your business plan and whether you will rent or buy, but now you need to push on with finding the perfect place.
If you are in retail, location will probably be key – you will need somewhere with a reasonable amount of footfall. You may also consider how easy it will be for your potential customers to park nearby.
If you are looking for an office, footfall may not be so important – depending on the type of business – but you still need to take into account where your staff will park and how easy it will be for them to get there.
Give yourself time to visit potential areas to scout out what is available within your price range.
Be realistic about how much space you will need – do your chosen premises give you room to grow in the future? – and don’t forget to factor in ‘hidden’ costs such as rates, utilities and things such as broadband connectivity.
EQUIPMENT & SUPPLIES
Apart from your premises, the cost of buying equipment and supplies for your business may be one of your biggest expenses. Technology such as computers, smartphones and printers don’t necessarily come cheap. Make sure you have factored this into your start-up costs.
Shop around for good deals but consider your future needs and always buy the best you can afford – buying cheap can be a false economy in the long run.
As well as the big things, you will also need office supplies – buying in bulk can be cheaper and again it’s worth shopping around.
SUPPLIERS & MANUFACTURERS
If you will be selling products, it is important to do your research into potential suppliers and manufacturers. Ask for prices including VAT and shipping costs, as they can make a huge difference to your bottom line. Ask for samples of the products to ensure you are happy with the quality.
If your product is to be manufactured, place a sample order of prototypes to make sure it meets your quality requirements.
LICENCES & PERMITS
Depending on your business, you may need special licences or permits to allow you to trade. Failing to obtain the correct licences may have serious consequences for your business so if you are unsure, find out before you go any further. If you are in the UK, you can find out more here.
There are many types of insurance available to protect your business, but some may be compulsory depending on your business.
You may need:
- Employer’s liability
- Public liability
- Product liability
- Income protection
- Goods in Transit Insurance
The only way to know for sure is to talk to a professional insurance broker.
AND FINALLY …
You also need to research other practical issues relating to starting a business, which may affect what you can and can’t do.
Make sure you are aware of:
- Data Protection Regulations
- Money Laundering Regulations
And, if you will be running a technoloy or ideas-based business, you may need to know about intellectual property law, such as trademarks and copyright.
There are some great resources out there is you need more help or advice on starting your own business.
A great place to start is www.gov.uk