How to set up a business from scratch
Thinking of starting a new business? Whether you have been in business before, or this is your first venture, there are a few things you need to do to ensure success. Here are our top tips:
Create a business plan
Convinced you have the next big idea in your back pocket? Create a business plan and test your theory. Look at the financials required, potential profit margin that’s achievable and carry out market research.
In other words, do your due diligence to ensure that you have a viable business before you invest heavily or leave a stable income behind.
Let HMRC know you will be self-employed
Even if you don’t plan to leave your day job behind just yet if you will be receiving income from the new venture you need to let HMRC know.
Decide on a business structure
Are you going to be a sole trader, limited company, have a partnership or set up a social enterprise?
Decide on the business structure that suits your enterprise. Ensure that you understand the difference between the different options and what the requirements are for each one.
You can get more information on the different types of business structures on the gov.uk website here.
Choose a business name
Depending on your business, this could be as simple as just using your own name. However, if you are going to be selling a product or setting up a larger company, then you may need to find a name that aligns with your brand.
If you are going to set up as a limited company, you will also need to check that the name is available on Companies House.
You may also want to see if a suitable website domain and social media handles are available before settling on something.
Insurance can protect you and your business against risks including accidents, sickness, theft and legal fees. The level of cover needed will depend on your business and how it is run.
Ensure you understand what you need and the terms and conditions of any insurance you purchase. For example, if you are required to have specific anti-virus software installed and you don’t, you could invalidate your coverage altogether.
Create a business bank account
If you are a limited company, you will need a separate business account, as the company is a separate legal entity to you.
If you are a sole trader, there is no requirement to have a separate business bank account. However, you may find it easier to keep all your business finances independent from your personal ones.
Ensure you are compliant
All businesses need to ensure that they meet all regulatory requirements, e.g. health & safety, licensing, data protection, industry-specific regulations etc.
You can get more information about this on the gov.uk website here.
Set up an accounting system
Decide on what type of accounting system you will use and if relevant, appoint an accountant, bookkeeper or financial advisor to assist you.
Sort out a workspace and equipment
Do you need office space, warehouse facilities, or will you be working from home?
What sort of equipment do you require? Will there be an initial financial outlay to get set up, or do you have a laptop, phone etc. that you could use for now?
Set up your website and any social media platforms you wish to use. Create a marketing strategy and a content plan for the next 6 months to a year.
Decide if you will need help with any of these tasks and if so, engage the relevant professionals to get your marketing underway.
Set up communication channels
How will you deal with clients or customers? Set up your email, telephone number and any messaging services you plan to use.
How will you fund your business?
You may be setting up with minimal costs and not need any additional investment, however, if you do need financial support, take a look at the gov.uk website here to see what grants, loans and other schemes may be available to you.
You may find that setting up in business on your own is challenging and often daunting. Consider speaking to a business consultant who can help steer you through the maze of decision making and hurdles that come with being a business owner. They can provide solace and motivation when things are not going so well and share in your success and identify how to capitalise on those moments when you are exceeding all your predictions.
We offer a free 30-minute consultation with one of our business consultants so you can discuss your plans and see how we can help you build a thriving and successful business for years to come. Contact us on 01424 776 214 or via email on firstname.lastname@example.org to make an appointment today.
If you found this information useful, you may also want to check out the following:
- The benefits of having a business plan
- How to prepare your business for success in 2020
- Director responsibilities for limited companies
MRA specialise in business solutions and are Life Centred Business Consultants based in East Sussex we service clients across the South East, Sussex and Kent, including smaller towns such as Ashford, Battle, Bexhill, Bodiam, Brighton & Hove, Cranbrook, Crowborough, Eastbourne, Hailsham, Hastings, Heathfield, Herstmonceux, Lewes, Mayfield, Newhaven, Rye, Seaford, Sevenoaks, Tenterden, Tonbridge and Tunbridge Wells.