What key factors do I need to know when starting a business?
Starting a business requires careful consideration of key factors that can greatly impact its success, however, the potential for rewards makes it a journey worth undertaking!
SO, WHAT DO YOU NEED TO KNOW BEFORE STARTING YOUR OWN BUSINESS?
Setting up a new business is not merely about innovative ideas or immense passion. It also demands careful planning and research.
Understand your market
The first consideration should be what market you are planning to enter. Understanding the market is not just about identifying a gap or a problem that your product or service solves.
It involves a deep understanding of the target customers, their needs, preferences and buying habits.
It also involves studying your competition, the pricing strategies in the market and the barriers to entry – in other words, lots of market research!
Develop a strategic plan that outlines your aspirations and the timeframe within which you expect to achieve your goals. It is important to be realistic with your plans and goals.
Determining the structure of your business is crucial when getting started.
This could mean being a sole trader, incorporating as a limited company or forming a business partnership. If you’d like to learn more about business partnerships, we provide business partnership support services
Your chosen structure will have implications on your responsibilities as a business owner, such as required documentation, tax obligations, how you take profit out, liabilities and handling losses.
Build a strong team
Behind every successful business is a competent and passionate team.
A business needs individuals with a range of skills – from sales and marketing, to finance and operations.
Additionally, it is important to create a positive work culture that encourages collaboration, innovation and professional growth.
However, employing talented individuals also creates additional payroll requirements, which will need careful management. We also provide a payroll management service if you are unsure or don’t feel comfortable about managing it yourself
Outsourcing this work to experienced and knowledgeable payroll experts could be extremely beneficial. Read more about the benefits of outsourcing here
Marketing and promotion
If you have a great product or service, it is essential to showcase it effectively.
Formulate a marketing strategy that may encompass networking or personal selling, email marketing and social media campaigns.
A quality website
A quality website is essential in today’s market. It acts as your virtual storefront, engaging visitors and building credibility.
It effectively communicates your services, reaching a wider audience.
A responsive, user-friendly site enhances accessibility and boosts online visibility, customer engagement and overall success.
Finances and accounting
Creating a separate business bank account is the easiest way to differentiate your personal and business finances.
Although managing your own finances and accounts is an option, leveraging the expertise of a professional accountant can be beneficial for legal compliance and optimising tax benefits.
There are various methods available to secure financing for a new business, such as:
- Self-funding (should it be available)
- Taking out a bank loan – bear in mind that your credit rating will be used to inform this decision
- Government grants – for some ventures, there could be funding available from the Government, particularly with the focus on the Levelling Up scheme
- Equity investments – these can be from people you know, crowdfunding platforms or angel investors
Acquiring finance often requires that you can show investors or lenders a clear business plan and demonstrate the financial health of your business. Read our comprehensive guide on top tips for securing finance for a new business
Using the services of an accountant can help you to prepare accurate balance sheets, sales and cash flow forecasts, as well as deliver deeper business insights that can help you to secure funding.
By addressing these factors thoroughly, aspiring entrepreneurs can increase their chances of building a thriving and sustainable business.