15 Step Guide To Starting A Business
When you are a customer you don't see all the workings that go on behind the scenes of a business. You may never think about it, but for those of you considering doing it yourself you probably look at the end result you get exposed to and think 'looks simple to me, anyone can do this'. But not everyone can do it as they don't have the right mind set, or prefer security over the unknown.
There is a whole world of pre-planning you have to do before you even open your business. Whether you are just starting to create your website or are in the midst of making your idea become a reality, this guide will help you get there in a structured and less stressful way.
When times are tough like they are now with the COVID-19 virus, it is often the best time to start a business. Mainly because a lot of new ideas and problem solving is going on, and a lot of your potential competition will be going out of business or changing what they do.
Follow these 15 steps to make your dream of running your own business a reality:
- Evaluate your decision
- Form a business idea
- Market research
- Devise a business plan
- Choose a business name
- Registering your business
- Make it official
- Build your team
- Design your logo and branding assets
- Create a website
- Choose a location
- Promote your business
- Learn and adapt
1. Evaluate your decision
Starting a business is life changing. It will take up a huge amount of your time and money, if you are thinking you'll be spending more time with friends and family and have more control over your hours, think again. When you first start out you could be working 24/7, your family and friends will have to understand this and support you, if they pressure you to spend more time with them, then you are likely to fail.
As you will be spending every waking hour on your project, make sure it is something you really want to do.
Depending on the industry you choose, you will need to be extremely good at what you do, if you are starting out with basic knowledge your journey is going to be harder and longer and the odds of you failing will be higher.
You will need perseverance, a strong desire to take the initiative, be self-reliant, have a success-driven mindset, be self-confident and have the ability to lead and communicate well with others.
You will also need to do a whole lot of face to face and social media networking, negotiating and managing, if you don't have the skills to do any of this, give up now or find someone who does and form a partnership with them.
Can you afford to live and set up a business? You will spend a significant amount of your own money, that you may never get back if you fail. You will also need enough money, six months, to cover dry spells when no work comes in. As COVID-19 has proven you'll need good cash flow and a substantial amount of cash in the bank to cover you when you can't work for a long period of time.
How do you cope with failure? It's important you brace yourself for failure, having some fear of failure is a good thing, it's what can drive you forward and make things happen.
2. Form a business idea
As you are reading this, I'll presume you probably know what it is you want to do.
If you aren't one hundred percent sure yet, have a think about:
- Have you come up with something life changing?
- Is there a process that could be made simpler?
- Is anyone else doing this but you can do it better?
- Do you have a hobby you want to monetise?
- Do you want a lifestyle business or want to earn millions?
3. Market research
You need to do market research to find out if there is actually a market sitting there waiting for you. You'll need to know where you fit into that market and whether there is enough space for you to enter it, or if this market is ready for something new that will change it.
Using search engines and local libraries is a good starting point, if you want to go more in depth you can purchase completed market research reports from marketing companies.
Take your time to understand if there is a demand, whether there is a gap for you to enter, and whether you can do it better than the rest. This will give you the confidence you'll need to move on.
From here you can start creating a list of what you want to achieve and what your realistic goals and objectives are - you should return to these often to update them - this keeps you focused.
4. Devise a business plan
Now you are ready to put your business plan into action, this is where you get to organise your ideas and the information you have researched. This will help you to stay grounded and focused, but can also help if you decide you need investors or bank loans.
Here are some of the elements a business plan includes:
Summary: This is your business concept. Think about your elevator pitch (where you tell someone what your business is in a minute) this is pretty much what your business summary should be.
Industry analysis: Putting together the market research you have done. You'll want to list how big the market is and how it is expected to change over a period of time. Who your real world and online world competitors are and what their strengths and weaknesses are.
Customer analysis: Describe your target audience and how you plan to reach them. Most people over project on this one, so be conservative with these figures.
Operational plan: What is your plan of action and timeline. You can break this down into quarters, but it should cover at a minimum 3 years.
Financial projections: Possibly the most important part because once the cash dries up you will be out of business. You'll need to project how much money you will need to invest into your start-up, how long that money will last, and when you will start making a profit. If you want investors, you will need to list when this is likely to happen as well.
It doesn't matter if you are selling a product or service, test it on your friends and family and ask them to be brutally honest. Then test it on other people to see what responses you get, if one person in one hundred people doesn't like your product, don't change it for that one person. There will always be someone who is not going to want what you have to offer. But if a larger percentage don't like what you are doing, then you can be confident it's not right and needs to change.
6. Choose a business name
If you haven't already done so, now is the time to choose a name. It should be easy to remember, you'll need to check no one has the same name within your industry, and if the name is available as a domain for your website. It's ok to take time over your name because it will cost you a lot of money, and possibly reputation, to change it later if you make a mistake.
7. Registering your business
You can register as a sole trader, partnership or limited company, to name a few. They all come with benefits and handicaps, such as, the amount of tax you pay, personal liability for debts, and when you have to report your accounts.
A great place to start your research would be with HMRC. You can also sit down with your bank manager, an Accountant or Solicitor who can give you some great advice. When starting out many of these professional people will give you an hours free consultation.
8. Make it official
Register yourself as self employed, or register your company, this gives you your Unique Code or Company Registration Number so you can pay your taxes. If you require licenses or permits to trade, prepare food, look after animals, or give professional advice then this is the time to get all your paperwork in place.
Once you are registered with HMRC and Companies house you can go out and open your business bank account. Now you will be able to bank your business receipts and make payments in your company name. In England most banks will not allow you to use your personal bank account to pay in business cheques.
You can now apply for grants, loans or use crowd funding sites.
You'll also need to get good at budgeting and managing your cash flow. You always need enough money coming in at the right time to pay off bills, expenses, taxes, wages etc.
Universal Credit is available to those who have less than £16,000 (year 2020) in savings. You will need to prove you are working and can meet the minimum income floor (worked out on what the Government expects your available working hours to be, and the minimum wage) you will also be required to report to a coach to prove you are increasing your income so it matches what you would earn if you did the same job as an employee of a company. You will need to give them information about the amount of money you have received each month, minus allowable expenses to qualify for any financial help.
10. Build your team
You may find you won't be able to bring in staff to help you for a while. To start with many small businesses will outsource work to Bookkeepers, Web Designers, Personal Assistance, Solicitors and secretaries.
It really depends on how much money you are making before you can start hiring staff. But hiring staff can allow you to take on more work, that leads to making more money. It's a bit of a balancing act and one of the hardest decision to make.
11. Design your logo and branding
Logos are the most memorable part of a business, it's best to get it right first time. But larger organisations have had evolving branding as they have grown and aged, so don't beat yourself up if you decide to change it later.
There are experts who will design a logo and come up with a brand identity for you, they will ask you a few simple questions then go away and produce something for you.
Your logo and branding has to be carried across all your assets, such as slogans, colour palette, font styles, business cards, website, social media, invoices and all business paperwork.
12. Create a website
Whether you are just trading through a website or will have a bricks and mortar business, you need to be online. You have the option of building a website for next to nothing with certain American Corporations, but in the long term it will cost you more, as the more your website needs to evolve the more they can up-sell to you. If you want to trade locally, why not work with a local web design and development company or sole trader.
We help our clients to understand where their website will need to be in 12 to 24 months time, so they can get everything in place at the beginning so they won't have any unexpected costs along the way. We know what we are doing so you can leave us to get on with designing and developing your website and content manager so you can get on with running your new business.
It is pointless having a website if no one can see it on the web. This is where search engine optimisation (SEO) comes in. Working with someone who knows what they are doing will get you listed faster than you will be able to do yourself if you don't know anything about SEO.
13. Choose a location
If you are going to need a bricks and mortar location, such as a shop, restaurant, office space or factory you will need to buy or rent these premises. You'll need to do some more research to decide which area will be right for you.
You'll need to understand the location, has it got the right age group, with enough money, and enough foot traffic to warrant opening a restaurant or shop. Does the office space offer enough off street parking. Is the factory near to main roads, ports or airports for easy delivery and shipment.
Once you have your location sorted out, get it listed on Google My Business and Apple Maps as soon as possible.
14. Promote your business
You've now launched your business and published your website, now it's time to tell the world you exist.
Now it's time to start building your social media marketing plan, start blogging, implement an email marketing strategy, and advertise where your customers are likely to be looking.
15. Learn and adapt
Businesses that survive evolve. They try something that has been tested by others, they learn if it is working for them, if not they test something else. Examples include using Social Media, advertising in different mediums, blogging, machinery used, office systems etc. They will constantly be doing this as you can not sit still in an ever evolving world.
When running your own business making mistakes is part of the package. We can't improve if we don't make mistakes. Trial and error only makes you a wiser person.
Don't be afraid to experiment with new goals and objectives after going through old ones. Sometimes you'll succeed, sometimes you won't. But always get back up and try again.
The life of an entrepreneur is all about adapting to unexpected turns and bumps in the road. The better you become at dealing with the things life throws at you the closer you'll get to being a leading brand.