Are you starting your own business?
Most people love the idea of running a business. What factors should you keep in mind before launching into a new venture? Here is some practical advice.
1. Products & Services
A product or service on its own cannot create a great business. You need to understand what it is about your offering that gives you a great business opportunity, then flaunt it!
You need to have a deep knowledge of what you want to sell. You also have to have a clear understanding of what your market actually wants, not just what you want to offer them!
Remember, the key to any good business is to offer the product or service that your target market actually wants. Find out first what your potential customers’ problems are and make sure your offer takes away their problem.
Once you are satisfied that you have a good product or service, you need to think about the marketing. I believe that good marketing is one of the main success factors in any business.
Marketing and advertising are fundamental in getting awareness about your business and getting it wrong can be very expensive both in real terms and in terms of lost revenue.
Despite what many say, there really is no dark art to marketing. It’s all about getting your message in front of the people that really matter, your potential (and existing) customers.
There are many communication channels you can use to do this, from old fashioned media advertising to e-marketing through online channels. To get the maximum return from your efforts and investment, you need to know which channels your customers use, then use those.
If your message is poorly written and presented, do you think your customers will trust you? It’s unlikely, so take time to get it right! Whatever you do, do it well – nothing is more important than building instant trust.
3. Funding & Planning
The third element of starting a business is perhaps the most important: Funding & planning. You must make sure you have the right level of funding in place from the start.
For example, opening a shop is much more expensive than starting a consultancy firm. Even before a shop starts trading the leasing agreement imposed by the landlord may be very onerous. Add to this Council Tax, security and all other costs and you may have heavy losses to deal with before the business actually starts trading.
Understating the funding needed to run a successful business is a major issue. In my experience, it is vital to prepare a good plan covering at least the first 3 years of trading. If necessary, budget for initial losses and make sure you have the right funding in place.
This is too important to get wrong! Seek professional help – your accountant is the ideal place to start. First, start by producing a proper business plan (something we help all our start-ups with) that is based on facts not fantasy –you must never fool yourself!
“You cannot abort a flight once the plane gains momentum and then leaves the ground. The same applies to running your business!”
This comment was made to me by a successful industrialist many years ago. He likened starting a business to that special moment in time when a plane takes off – his plane happened to be a private jet.
Knowing and admitting to one’s limitations is the most difficult thing for many people. We all like to think that we can fly high, but the reality is that the majority should keep their feet firmly on the ground. So, the fourth element for a successful business is to look for the right support structure.
There is plenty of advice out there but not all of the advice is beneficial. You need to sift through the advice and the advisors to make sure that you surround yourself with experienced and knowledgeable people who can help.
The Bottom Line
It’s very important to make the right decision as to whether you should be self-employed or form a limited company. The implications are important and costly. If you would like to discuss the advantages and disadvantages of forming a limited company as opposed to being self-employed in a more detailed and personalised manner, we will be happy to do so on a totally free, no obligation basis.