10 tips for starting a business
Top tips for getting your business off the ground
The UK start-up scene is thriving. According to the Barclays and BGF Entrepreneurs Index, the number of new businesses is up 3.86%, the biggest rise in 3 years . So, what are you waiting for?
Remember, though, to make sure you get independent legal advice.
1. Decide what you’re going to do
According to a recent Forbes survey, 42% of start-ups fail because there was no market need for their product . So, before you start, ask yourself if there’s a gap in the market that you can fill. Is there something that you can do differently that would make your business unique? And will you have customers to sell to?
Rachel Clements started her artisan soap business Lansdowne Originals 3 years ago. ‘I’ve a PhD in chemistry and started looking at the idea of creating soaps that didn’t use palm oil and were allergen-free,’ she says. ‘I spent 6 months on research and development and a lot of time on soap forums sourcing suppliers and looking at trends in the industry. What made me go for it was a chance meeting with a retailer in my local village who was looking for a supplier of handmade soaps. I offered her a sample batch and the rest is history.’
2. Write a business plan
According to our research, 1 in 4 SMEs doesn’t have a business plan . However, setting time aside to create one can help you define what you want to achieve. A strong plan can make it easier to win funding too. Download a free business plan template .
3. Pick a name that packs a punch
There are a few things to think about when you’re choosing a name. Remember, if it’s something too obscure, you’ll have to work harder to let potential customers know what you’re about. It’s also worth logging on to the Companies House website to check that a name isn’t already taken or that someone doesn’t have something similar. There are other resources available to check for existing business names and trademarked names, too. ‘Initially I traded as Wizzo Films,’ says Verity Wislocki of Wislocki films , ‘but there’s a company with a similar name. I ended up being in too many meetings where people said: ‘Ah, are you something to do with…’ so we rebranded to protect our brand reputation, and theirs.’
4. Choose your business structure
There are several business structures to choose from, 4 of the main ones are: sole trader, partnership, limited company and limited liability partnership (LLP) . If you become a sole trader or LLP, you’ll be liable for your business debts. That means – if you get into financial difficulties – assets, such as your home, could be used to repay your debt. A limited company could remove some of this personal liability, but you may have additional personal and company reporting responsibilities.
Whatever you decide, let HMRC know . If you don’t inform them of any changes in your circumstances, you could face a fine . You’ll also need to register for self assessment while you’re self-employed. HMRC’s YouTube playlist has a number of video guides to help you.
5. Register your company with Companies House
If you go down the limited company route, you’ll need to register with Companies House . You’ll have to supply details of company directors, shareholders or members and your office name, address and additional information.
6. Set up a business account
Sole traders don’t have to have a separate business bank account. However, if you go down that route, you’ll need to stay on top of your expenses and set aside money for your tax bill . As a limited company, you’re required to have a separate business account because your company is a different legal entity to you.
7. Stay on the right side of the law
Whatever kind of business you’re looking to get off the ground, make sure you’ve got the legal stuff sorted and always seek independent advice before you start. If you’re employing staff, you may need employers’ liability insurance. If you’ll be bringing customers onto your premises, you should consider public liability insurance. If you’re selling products, you may need product liability insurance. And, if you’ll be using a car, you’ll need that to be insured, too. Download the Association of British Insurers’ PDF guide .
8. Decide if you need premises or if the kitchen table will do
Just because you're starting your own business doesn't mean you need to spend money on an office. ‘As well as your kitchen table, try coffee shops, libraries, co-working spaces,’ says Ian Sanders, author of Leap! Ditch Your Job, Start Your Own Business & Set Yourself Free .
9. Manage your books and cashflow
You also need to keep accurate financial records. HMRC has a guide for this.
The number of years you’re obliged to keep records for may differ, depending on the type of business. If filing isn’t your forte, electronic bookkeeping software can help you keep on top of invoices and your accounts. For those of you who keep your expense receipts in a shoebox, consider employing the services of a chartered accountant , who can help you work out salary, VAT and PAYE and a cashflow forecast for your business.
10. Start marketing and build your brand
Don’t make the mistake of expecting your customers to come to you – market yourself. Companies such as webfactory offer affordable website packages, or you could try and create one yourself using WordPress .
Social media can be a cost-effective way to get your brand out there. However, you need to be clear about who your customers are, where they are and what messages you’ll be delivering.
Networking and word of mouth are also great ways to win sales, and organising events can be a good, if expensive, option. Make sure you have the budget for it before you start.
Inspired? We hope so. Here’s to ringing in the new and a future of unlimited possibilities for your business.
This article is proprietary to Barclays Bank PLC. Every attempt has been made to try to ensure that the information contained in this article is accurate at the time of publication. However, any articles written by any third party are the views of the authors alone, and do not necessarily reflect the views of the Barclays Bank PLC Group ('Barclays) nor should they be taken as statements of policy or intent of Barclays. Barclays takes no responsibility for the veracity of information contained in any third party articles and no warranties or undertakings of any kind, whether express or implied, regarding the accuracy or completeness of the information is given. Barclays accepts no liability for the impact of, or any loss, however arising, from, any decisions made based on information contained and views expressed by any third parties or in their articles.