Starting a business can be a time of both great excitement and trepidation.
With so much to consider, how do you know where to focus your efforts? When it comes to starting your own business, there are some steps you can take to help you define things like your market proposition, financing needs and options, publicity strategy, and other elements that will be nothing short of crucial to its success.
Why do you want to start a business?
For some, the prospect of filling a gap in the market is exciting and potentially lucrative. For others, the idea of working for yourself and enjoying the independence and freedom that this can bring is a big draw towards self-employment. For most entrepreneurs however, it is a combination of both of these things alongside other factors that makes starting a business in the UK so appealing. Once you have thought about the business you want to start and why you want to do so, you can begin to flesh out other important elements; to do this, you should start with the most important step.
You’ve heard it said before, “If you fail to prepare, prepare to fail.” When you are thinking about starting up a business, you should carry out thorough research before taking any formative action (and certainly before investing any substantial capital) to ensure it is a viable idea. This means not only conducting initial research carried out online, but also gathering data through more in-depth research to get a working knowledge of things like customer demand, current supply, competition, costs of production and other important information. Get involved with your chosen market; attend trade shows and exhibitions, hold focus groups, conduct surveys, canvass opinion and make sure you have a prospective customer base for your business.
Before you go into production on a large scale, a great way to test the viability of a start-up business is to start with a small focus group, or a limited geographic area for example. You could consider partnering up with online blogs or social media accounts that target your audience with contra deals or give-aways, therefore ensuring you are getting the product into the right potential users (as opposed to just family and/or friends). Make sure you obtain qualitative feedback – do they like the product? How much so on a scale of 1-10? Would they buy it again? Would they recommend it to a friend? In the words of Peter Drucker, “If you can’t measure it, you can’t manage it.” Without obtaining quality, usable data regarding the reception of your test run, it will be impossible to manage any tweaks that may be needed to better the chances of success.
One of the key things you will need to consider is the financial viability of your business. This means examining how much money will be needed in start-up costs, along with how much will be required to sustain the business before it starts turning a profit. You should also have an indication of sales and turnover, and you should bear in mind that where and how you do business will have a big impact on this; for example, starting an online business that operates from your home versus a venture that will require an office and associated overheads will have different financial requirements entirely. Once you have examined the financial side of things, the details of this analysis along with all other important strategies should be clearly written out.
While this document isn’t a legal requirement, any successful business owner will testify that a clear business plan is essential when it comes to outlining the steps you will need to take to not only start a business, but sustain it. It should include things like an Executive Summary or overview of your business, along with further details about things such as objectives, marketing strategies, your target market and customer demographic, and your sales and financial forecasts. If you want to attract any capital from investors or to apply for a start-up loan, you will need to have a clearly drafted business plan.
Once you have identified the nature of your business, the customer base, a solid business plan and a financial strategy, it’s time to form your business.
Approaching an experienced formation agency to help you with this can save you considerable time and money, and it can also provide you with added peace of mind and confidence. We know the ins and outs of each company structure, and based on discussions with you, we can help you determine whether your needs would be better served by registering you as a limited company, a limited liability partnership, or something different. When you enlist a formation agent, you can cut down on the paperwork, time and cost that can otherwise be involved with trying to form a company without professional advice and help. As we can guide you through the process quickly, we can get your business up and running in just a matter of hours! This means you spend less time navigating red tape when forming your business, and can get trading sooner rather than later.
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