Here are some things to consider
1. Knowledge of Product or Service
Most people will go into business for one of the following reasons;
- they hold a recognised qualification relevant to their business idea,
- they have previously gained years of experience of working in a particular field as an employee or
- they are passionate about a hobby or interest and want it to be their main source of income.
Whatever your reason, being able to demonstrate a skill/passion/competency in your chosen field will inspire confidence in your ability to deliver when meeting potential customers.
2. Market Research
Carry out research to assess whether there is a market for your chosen business. If no one else is doing what you are, ask yourself if there is a reason for this? If there are many companies doing it, is the market saturated or is there room for one more? If you believe there is room, what will you do to make customers choose you over the established competition? The key to your success could be having, and being able to communicate, a Unique Selling Point (USP).
Engage the services of a local accountant as they will be able to advise on the best legal structure of your new venture, be it a sole trader, a partnership or a limited company. Most offer a free initial consultation and can help register your business with HM Revenue and Customs and, if necessary, Companies House. They can help set up bookkeeping systems and advise on what taxes will be applicable and when they fall due.
4. Business Plan
Having researched your market you can now add some financial targets and a pricing structure. Be realistic and know your numbers. Calculate your overheads thoroughly and what your break even point would be. If an overhead increases, know how much additional revenue you would require at your current gross margin, in order to retain your same level of profit.
Form a clear picture of where you require your business to be in 3, 6 and 12 months time. Put systems in place to enable your to monitor your performance against these projections and be prepared to amend your projections in the case of any unforeseen circumstances.
Arrange a meeting with bank managers at several local high street banks. Understand what business banking arrangements each one has to offer eg charges, online banking, overdraft facilities etc. Often though, the key is how good the Relationship Manager is and the level of service they are prepared to offer their customers.
6. Practical Considerations
Ascertain what you will need in order to trade. A PC and printer, a van, an office with furnishings, tools, software etc. Consider how you will require them and what they will cost. Ensure that you have sufficient start-up capital in order to commence trading from day one.
Be sure to investigate what types of insurances are applicable to your business ie. public liability, professional indemnity, premises insurance, employers insurance, to name a few. If you plan to work from home, check your home insurance to check your cover is suitable.
Understand the level of compliance you may need in order to run your business in your chosen industry. Make contact with the regulatory bodies and assess if you meet the minimum requirements and if there is any registration and annual fees involved.
Initially, any budget for advertising is likely to be tight so it is important to stretch that budget as far as you can. It is equally important though to ensure that any funds spent, is on an advertising medium that will reach as many potential customers for your business as possible.
10. Business Networking Groups
Becoming a member of a networking group is an excellent and relatively inexpensive way of raising your company’s local profile and gaining from the experiences of like minded business people in your area. Giving and receiving good quality introductions from fellow members will help to grow your business. Most meetings will allow you to initially attend as a guest so you can find the group most suitable for you before committing to any annual fees.