Setting up a new business, whether it’s the combination of years of planning or taking advantage of a gap in the market is an exciting prospect either way.
However, no matter what the idea that’s on the table, the reality is that all new ventures require a lot of groundwork to ensure success. While it’s impossible to get everything right the first time, putting in the research now will significantly reduce the chances of any aspect threatening the business. This is especially the case when it comes to the basics, such as complying with the law and making good business decisions.
So with both the viability and longevity of the new venture in mind, here is an essential guide for anyone looking to start a business in the UK.
Any new business owner might think what they have to offer is great, but do the wider public agree? A staggering 42% of small businesses fail because there’s no market need for their services or products.
That’s why the most basic place to start is to conduct research about whether the business aligns with public demand, as well as identifying the target demographic of the business.
It sounds simple enough, but without a clear idea of who would likely purchase from the business, it’s impossible to deliver a clear cut strategy both in terms of product offering and marketing. Failing at either of these could easily cause the business to crumble before it’s even had a chance to take off.
Most importantly, consider what the business has to offer that’s unique especially if entering a crowded market.
Work on the financials
All business owners need to fully understand the costs involved in running their business, since without positive cash flow the business will not be able to survive, let alone thrive.
Aspects to consider include the cost of stock, labour, business premises hire, business rates, insurance and marketing. Also, how the business will be funded in general whether this involves applying for a business loan or using existing capital, including putting aside contingency funds should the business encounter any unexpected expenditure.
Consulting a business or financial advisor prior to starting a business is a wise move. In addition, the services of a bookkeeper and accountant will also need to be sought as soon as the business starts trading.
Name the business
Whether opting for a short and punchy business name, a clever pun or something a little more traditional, all businesses need a name that’s not only original but is reflective of what the business offers.
Some of the top aspects to consider when naming a business include:
- Is the name already taken?
- Is the name relatable to the industry?
- Is it memorable?
- Is the .com or .co.uk domain name available?
Register the business
All businesses need to be registered with HMRC, and depending on the nature of the business, the local council too. As part of the business registration process, additional licenses or permits may also need to be sought.
Hefty fines or even the closure of the business could ensue for businesses that don’t follow the rules. For something which is often incredibly straightforward to arrange by filling out a form or calling up the relevant department, such steps cannot be skipped.
Nobody gets into business to think about insurance, but the grim reality is that without it, any number of scenarios could quite easily leave the business and its owner vulnerable to financial ruin.
Some insurance types such as employers’ liability insurance are a legal requirement, as is vehicle insurance for any vehicles used for business use. A positive note here though is that business insurance often costs far less than people perceive, with NimbleFins public liability quotes averaging just £14.80 a month, in exchange for up to £3 million worth of cover.
Find business premises
Any business that requires a physical premises such as a retail unit, warehouse space, offices etc will need to find a location that is fit for purpose.
For any customer facing businesses, consider the location of the premises and whether it ties in with the target demographic of the business.
With hiring employees, there are several aspects to cover. The first of which is the responsibility that employers have such as registering new employees, checking each candidate’s right to work in the UK, putting new employees onto the payroll and updating the business insurance.
From a practical point of view, employers need to consider what attributes the role requires to ensure the right candidates are hired for the position. For those who have never employed anyone before, business mentoring can point newbie employers in the right direction. Doing so can help avoid costly mistakes especially where high employee turnover is concerned.
Invest in marketing
It doesn’t matter how great a business is if nobody knows about it! Marketing of the business should commerce long before it launches, so that the word is spread far and wide.
Hiring the services of a marketing agency or a social media expert may be required to ensure the latest techniques are being used, and that the success of campaigns are maximised.
To sum up
Setting up a business is an admirable feat, but one which needs thorough planning and research to help avoid any bumps in the road. But by putting in the work now, new businesses have a much better chance of success, versus setting up shop and hoping for the best. Ensuring all of the above points have been addressed is undoubtedly a great place to start.