Company Formations & Start-ups

How to avoid common mistakes when setting up your new business

Starting a Business: What You Need to Know First

Posted on 22/05/2018 by Janette Allen Team

Starting a business can be an immensely satisfying and lucrative venture and it’s no surprise that many people today are striking out on their own to develop and expand their own business ideas.

But it’s never easy to get things up and running. If you don’t put enough thought, time and effort into planning your business, then you might end up being unprepared for the rigours and challenges waiting for you. This month, we’re taking a look at the things you should research before taking the steps to get your business up and running, so you have the best possible chance of success. 

Check out the competition

If you’re seriously contemplating starting up your own business, then you likely already have a solid idea of what the business will be about. You will probably be stepping into a competitive market, so take some time beforehand to thoroughly scout out your competition. Seeing how an already established business is faring in the market will, primarily, give you an idea of how profitable your own business might be. Is there precedent for success? Or have all other companies who have had a similar idea fallen at the first hurdle?

There’s a lot to learn from the successes and mistakes of others, so get as much insight as you can into your competition and use that to inform your own plan.

Funding

Ideally, you’d be able fund the establishment of your own business with your own money, but that is rarely the case. You should get a realistic idea of how much money launching your business will actually cost and scout out potential investors, through family, friends or colleagues. You can also research bank loans, and what is on offer for businesses from different branches.

There may also be schemes in place which offer business grants in your field. Perform thorough research as to what the requirements might be for these, and tailor your business plan to be an attractive prospect when it comes to applying. Business grants are, naturally, hard to get, but can prove immeasurably helpful if you can obtain one.

Legal issues

There are many legality issues you will need to consider before setting up your business, including licensing, tax and employment considerations. We have previously covered the legal aspects of establishing a business here, so take a look for more in-depth information.

Draft your business plan

Writing up your business plan might seem intimidating and time consuming, but doing so early on will, more than anything, give yourself a clear and structured overview of the viability of your business idea. Going through every aspect of your idea, from initial justification and market identification, to marketability and profit margins will flag up any discrepancies or points that need to be revised.

Your business plan should be one of the first signals of the potential and practicality of your business, and seeing it come to fruition on paper will be a huge confidence boost – which could prove important when it comes to getting everything together.

Business structure

Identifying the right business structure for your company will influence a number of factors down the line. We covered the differences and benefits of sole trader, partnership and private company structures previously, so take a look for more detailed information.

USP, recognition, target audience and websites

Your business plan will help immensely with figuring out your brand image and what sets you apart from other businesses in the same field. This will help you identify more closely your target audience, which will in turn influence the best ways to reach that audience. You should research the best ways to gain recognition for your business, and identify what parts of the business will cater to your customers in ways other businesses don’t. This is your USP (unique selling point). This will inform your marketing plan later on, and will make your business clearer and more attractive to investors.

You will also want to look into your potential web presence. A website can come later, but getting a simple blog up and running and having some social media presence in the run up to the opening of your business will help drum up interest and build up an audience.

Financial advice

One of the most important factors when it comes to sustaining your potential business is prudent financial planning. Bringing in expert advice from professional accountants will give you the best chance of success. An accountancy firm with dedicated support for start-up businesses can help you save money, advise you on investments, help you with setting up a business bank account and more.

Janette Allen Accountants provide professional and informative advice to startups so they have the best chance of success right from the start. If you’re developing your own business in Braintree, Essex and need friendly support from experienced accountants, don’t hesitate to get in touch with Janette Allen accountants today.

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