Starting a business is an exciting process and it can be truly fulfilling to be able to use your skills or knowledge in order to make money. However, there are a number of essential things you simply must have before you can launch your business venture. Let’s take a look…
1) A Business Plan
The business plan is the blueprint of your business, and without it, your business aims lack focus and direction. Many people assume that a business plan is a static document that is put together when you first start out and then set aside. On the contrary, it should be something that adapts over time as the business grows and develops. A good plan should test the practicality of your business, helping you decide whether the idea is likely to work in the long run, giving you the best chance of success. Your business plan will also help you to secure much-needed funding, such as bank loans, as well as attracting investors who may be interested in your business idea.
2) Funding and Finance
One thing crucial to getting your business off the ground is funding. You may have a great idea but in order to turn it into reality, you need cold, hard cash behind you. Lacking the necessary capital when you first start out will hold your business back and it will struggle to grow. Bank loans are an option, but in this financial climate, banks are often reluctant to lend to start-ups, wanting to see evidence of profitability first. Many people choose to re-mortgage their homes, as it can be less expensive than a loan; but there are risks involved in doing this, and you should consider these before making any decisions. Others choose to use personal savings or borrow from family and friends.
Whatever your business, you’ll probably need some sort of insurance to protect you should anything happen. After all, there are all sorts of things that can mean your business has to shut its doors, such as fire or floods. If you insure your business against catastrophic loss, your closure will be only temporary rather than permanent. If you will be inviting the general public into your business’s premises, you will also require Public Liability Insurance. You may also want to consider insuring your business against theft, litigation and personal injury or illness.
These days, with so much competition to win new business, businesses need to ensure that they are advertising effectively in order to reach their target market and grow a customer base. At this early stage, the promotion of your business is vital to its success and you should take steps to get your business’s name out there. Depending on your budget, you could opt for fliers, radio commercials or even TV coverage. Also, whilst a website is not crucial in the early days of your start-up business, it can certainly help significantly, making you seem a more professional organisation as well as giving potential customers an idea of what you’re all about.
5) Contact with HMRC
When you first launch your business, you’ll need to contact HMRC to register as self-employed (if your business is just you, you will be a ‘sole trader’ - your own boss, essentially), as you’ll be responsible for paying your own tax and National Insurance contributions. This means that along the way you will need to keep records and information about your income so that you can fill in an annual Self-Assessment tax return. Depending on your business, you may also need to register for VAT. If you don’t tell them as soon as you start self-employment, you could incur charges. Visit the HMRC website for more information about registering as self-employed.
So, whilst starting or buying a business can be full of excitement and anticipation, there are certain things you need to take care of before you can get busy making your fortune. Failing to do this can leave your business flailing before it’s even had chance to get going, or even worse - leave you in financial or legal hot water.
Published on behalf of Mr. Michael Palmer. He is an Oxford based business graduate and writer. His writing covers many subjects, including business, marketing, HR, fitness, and football.