Everything You Need to Know to Start a Business in a Nutshell
Well, maybe not everything...but certainly the main points to follow. If you work through this business start up guide, making sure you follow each step, you will have a good chance of getting your new business off to a good start.
It is easy to get excited about a new business venture or idea. Sometimes this means neglecting the realities of whether the business truly has a market or will make money. This lens provides you with some practical guidelines to bring you back to earth and help you start out right. Final health warning - although this gives the process in simplified lists, each item may require quite a bit of work - so don't expect it to be easy!
Enjoy the journey.
It is easy to get excited about a new business venture or idea. Sometimes this means neglecting the realities of whether the business truly has a market or will make money. This lens provides you with some practical guidelines to bring you back to earth and help you start out right. Final health warning - although this gives the process in simplified lists, each item may require quite a bit of work - so don't expect it to be easy!
Enjoy the journey.
How Will My Business Make Money?
If you want to start a business, and for it to be successful, then the first thing you need to consider is if the business will actually make you any money. Although it may sound silly that anyone would go into business without being sure of this, if you haven't asked yourself the following questions then you have no guarantee of your business working and worse still, you may waste both your time and money.
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1What am I Selling?
If you are selling products or an obvious service such as hair-dressing then then the answer to this question is easy. However if you are looking to move into a consultancy role or a less clearly defined service role you need to be sure that:
a) you are clear about your services and
b) you make this clear to your potential market. -
2Will I make a Profit?
Why would anyone go into business if there is likely to be little or no profit? The issue here is making sure you have a clear idea of how much it really costs to produce or deliver your product or service, along with your overheads. Watch out for hidden costs and don't forget the value of your time. Deduct this from your sales. Simplified profit or loss.
If you could get a job paying you more per hour than your profit works out to be, consider whether the business is worth it. -
3Will I Make Enough Profit?
Will you be able to sell enough to pay your bills? If you are 'doing' the business instead of 'managing' the business (e.g. doing=you are cutting hair and managing=you employ others to cut hair) how can you grow your business to make enough?
Business Planning
Once you have got a clear business in mind you can really move into start up mode. The most important part of starting and running your business will be making and following a business plan. This does not have to be a huge document, but should be clear enough to clarify what your business is about; who your customers are and how you will reach them; where you want the business to go and how you intend to get there.
You can either create something unique yourself, work with someone else, pay someone to do it for you, buy ready made plans or use something like Business Plan Pro.
Business plans are not for bank managers, they are for you, the business owner. The bank manager likes to see your plan to be sure you have thought your business through properly and now what you are doing.
Create Something Unique
There is nothing wrong with creating your own plan from scratch, but why re-invent the wheel, with the risk of leaving something out, when there are other options that will ensure you cover all your bases. This can be the cheapest option but may be the most time consuming, or risky if you try to skirt round the aspects of the plan you do not understand or like.
Get Someone Else To Write It
Whose business is this and who will be completing this plan? To really get to grips with what is required in your business I strongly suggest this is the worst option. I speak from experience. I paid someone to produce a lovely plan for me but it was just a static document that sat on my shelf as it did not make a lot of sense to me. Useless.
Work With A Business Advisor or Coach to Produce It
This is a great way to pull together a strong, personal and effective business plan. Your advisor should be working with you to help you tease out all aspects of your plan, encouraging you to face the questions you may shirk on your own and point you in the direction of where to get professional help for the more specialist sections.
Use a Planning Tool
Business Plan Pro is my preferred option for business plan writing, and I use this for my business plans as well as when working with business clients. I love its structured format, its business documentation and the great range of sample plans.
You can either create something unique yourself, work with someone else, pay someone to do it for you, buy ready made plans or use something like Business Plan Pro.
Business plans are not for bank managers, they are for you, the business owner. The bank manager likes to see your plan to be sure you have thought your business through properly and now what you are doing.
Create Something Unique
There is nothing wrong with creating your own plan from scratch, but why re-invent the wheel, with the risk of leaving something out, when there are other options that will ensure you cover all your bases. This can be the cheapest option but may be the most time consuming, or risky if you try to skirt round the aspects of the plan you do not understand or like.
Get Someone Else To Write It
Whose business is this and who will be completing this plan? To really get to grips with what is required in your business I strongly suggest this is the worst option. I speak from experience. I paid someone to produce a lovely plan for me but it was just a static document that sat on my shelf as it did not make a lot of sense to me. Useless.
Work With A Business Advisor or Coach to Produce It
This is a great way to pull together a strong, personal and effective business plan. Your advisor should be working with you to help you tease out all aspects of your plan, encouraging you to face the questions you may shirk on your own and point you in the direction of where to get professional help for the more specialist sections.
Use a Planning Tool
Business Plan Pro is my preferred option for business plan writing, and I use this for my business plans as well as when working with business clients. I love its structured format, its business documentation and the great range of sample plans.
Useful Links for Business Startup
The following links are some of the best sources of information on business start up in the UK.
- Business Link
- This site provides a wealth of information for start ups and even more established businesses.
- Companies House
- Everything you need to research your potential company name if you are setting up a limited company.
- UK National Statistics Publications
- Useful site for official figures. Use for market research, articles and general information.
- Inland Revenue
- Everything you need to manage and understand your taxation issues.
- ISO
- This is the international site. Any documentation on ISO standards, including quality, environment and health & safety.
- British Standards Institute
- The BSI work with ISO to answer the needs of UK business.
This Little Piggy Went to Market
So you have a great business idea, and are dying to start up your new business enterprise. You have clearly defined your products and services and have a great vision and some fantastic goals. You've also started your business plan. You now need to consider your market and your marketing and sales processes.
The first thing to do is to create a marketing plan. This can be part of your business plan or a separate document. As with your business plan, you have various options open to you: do it yourself from scratch, work with a marketing professional or use a tool such as Marketing Plan Pro. The issues here are similar to those faced when working through your business planning options.
As sales and marketing are so important in your business, and marketing and advertising can be a major drain on your funds, you may want to spend some time getting more familiar with the world of marketing.
This may seem like an unnecessary expense, but once you have been through the cycle of realising how hard it is to get noticed, have tried various advertising routes with little success, along with a sizeable chuck of money disappearing, you will realise that some knowledge will help you navigate your way through the marketing jungle a little better.
Consider the points below when creating your marketing plan. And, don't forget - once you have a plan - follow it!
The first thing to do is to create a marketing plan. This can be part of your business plan or a separate document. As with your business plan, you have various options open to you: do it yourself from scratch, work with a marketing professional or use a tool such as Marketing Plan Pro. The issues here are similar to those faced when working through your business planning options.
As sales and marketing are so important in your business, and marketing and advertising can be a major drain on your funds, you may want to spend some time getting more familiar with the world of marketing.
This may seem like an unnecessary expense, but once you have been through the cycle of realising how hard it is to get noticed, have tried various advertising routes with little success, along with a sizeable chuck of money disappearing, you will realise that some knowledge will help you navigate your way through the marketing jungle a little better.
Consider the points below when creating your marketing plan. And, don't forget - once you have a plan - follow it!
-
1Who is My Market?
For many excited entrepreneurs the obvious thought is that surely everyone want to buy my fantastic service or product? Others may already have a clearly defined specialist market. The important thing is to try to find your niche, particularly in a busy market place. This allows you to focus your advertising and marketing efforts better. Consider demographics (age, gender, socio-economic group etc.), the problems this group face, what they read, where they like to go in their spare time and so on. -
2How Do I Get To My Market?
If you have clearly defined who is in your market and where to find them this follows on quite easily. Appropriate methods of contact will become quite clear. If your business is more of a personal, individual service with a high price tag then mass marketing or advertising is not likely to be as effective. -
3How Do I Get Them To Buy?
Knowing your competition, both direct and indirect is very important. This also relates back to whether you will earn enough from your business. If the market place is saturated with people like yourself then you will need to define a strong brand and a great USP (Unique Selling Proposition) to make yourself stand out from the crowd. -
4Who Will Do It?
Will you do all this yourself, taking the time and effort, possibly increasing the time to get the business off the ground? Will you outsource this, paying experts to either create your marketing plan and strategy and see it through, or to work with you to achieve your desired results?
Popular Business Start up Reading
Managing The Business
So you are clear about your business idea and what you are selling. Yes, it will make you money. You have identified your market and your competition. You know how you are going to get those sales. The next consideration is how you will keep the business going.
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1Cashflow
Cashflow is about ensuring you have access to enough money on a day to day basis to keep your business running. It is the most important aspect of keeping a business afloat. Make sure you have a clear idea about how you will manage your money. You may choose to manage it yourself using a package like QuickBooks, which also gives lots of online support, or you may prefer to outsource it to a book-keeper. Whichever way you manage your day to day finances, you would be wise to employ an accountant to help you minimise how much profit you pay out in tax and to give you other financially related advice.
As money is so important in business this is another area that you might want to invest in your personal development. You do not need to become a book-keeper or accountant, but gaining an understanding of the jargon and knowing how to read the financial reports will help you feel more comfortable around the figures. You will also be able to see where your profits are going and have a clearer idea about how to manage the finances better. -
2Process and Quality
Once you have started your business it is important that you ensure it can sustain itself. Putting good processes in place, looking for ways to maintain quality, are important ways of attracting customers and making them come back.
Do you want to achieve ISO status? Does your industry have other recognised standards? Showing your commitment to quality is a great way for a business to show their commitment to their customers and an excellent performance. Your customers will feel reassured that you intend to deliver to high standards. -
3Legal Stuff
Your business has to comply with the law of your country. This starts when you setup the business; what format will you choose, sole trader, limited company, charity and so on? Other considerations include Health & Safety, Insurance, Equality, Data Protection and Environmental compliance.
You may have specific legal issues related to the business you are starting. Do your research and remember that ignorance is no excuse.
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Hi, My name is Jacky Tustain and my prime focus is on helping small business owners, in the UK, overcome the frustrations they come up against when ru... more »
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