Top Tips for Starting Up Your Own Business
Tuesday, July 21, 2009 2:23
Despite the global economic downturn there are still plenty of opportunities for small businesses, but it is more important than ever that you have a detailed and realistic business plan, and have thought carefully about how you will finance your business set up.
Business Plan
The business plan will help you to work through all of the issues and potential problems involved in setting up a small business, and will be an essential tool to help you focus and develop your financial needs. It will also show banks and other potential investors that you are serious about your business idea, and that you have a clear vision for how your business will work. It is important to be absolutely honest with yourself about key issues, such as how much you would hope to achieve in profit in the coming months, as a robust and realistic plan could mean the difference between success and failure in your first years of business. A good business plan should include:
- Executive summary – this should include an overview of your complete business idea, stating who you are, what your business idea is about (services/products that you will offer and customer groups you will be focusing on) and also what you hope to achieve.
- Marketing Strategy – show here that you have considered your competitors, and how you plan to plan to attract customers to your product/services. List here any details of potential advertising and marketing campaigns.
- Management and Staff – if you have any management experience then mention this in the business plan, and also list some details of the skills base you will require and the numbers of staff you hope to employ.
- Financial Forecast – breakdown your business plan into cold hard facts, and give details of what money you think you will need over the next three to five years for set up, equipment leasing, staff, IT and premises. Try and calculate any risks that may affect your business during this time such as commercial, operational and personnel issues, and also calculate your sales pattern over a range of scenarios (such as high opening sales which slow down over the next few months or slow opening sales steadily increasing after 3 months), and also include any ‘down time’ whilst you are recruiting, training or setting up your premises
Business Loans
You may need access to money quickly to cover any unexpected costs and keep your business operating during cash flow problems, and fast business loan from banks and other official lenders can be a good way of applying for the money you need quickly and securely. Compare interest rates before you apply and try and get the best deal you can, as although fast loans are very convenient they can often be less flexible and more expensive in the long run.
Taxes
If you have business premises you will also need to include the ‘Business Rates’ in the overall leasing or running costs, and you can find out more about this by contacting your local council. You will also need to keep clear financial records (accounts) from the start, to ensure that you can work out what tax you will need to pay. As a basic guide you should look be looking at paying Income tax, National Insurance contributions, Corporation Tax (limited companies), VAT (profits exceeding £67,000 per annum) and Stamp Duty Land Tax on bought and leased premises. You should contact your local HMRC to find out more about what you should be paying.
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