Flying solo: what it takes to open your own business
6th June 2019
We have all sat in work on a Monday morning thinking ‘there has to be more to life than this’. Questioning why we are sat making money for the industry big wigs, who, frankly, probably doesn’t even know our name. Well, if you have, you aren’t alone. Seven in 10 Brits have toyed with the idea of starting up their own business. Being your own boss has never been easier. Technological developments accompanied by the annual commission of the likes of Dragons Den and The Apprentice, makes going it alone look even better, but with 80 per cent of new businesses failing in the first year and a half, we examine what it takes to the make the jump.
The initial stage
Once you have made the decision to set up the business, you will be faced with your first major dilemma — whether to start as a sole trader, a partnership, or a limited company. A sole trader is undoubtedly the easiest of the options to establish, however you will assume all financial responsibility for the business and your personal assets do not exist as a separate entity to that of the business’. Therefore, if the business was to fail, you are at a risk of losing your personal possessions as well.
On the other hand, one can choose to set up a limited company in which limited liability does exist, however the process is more time consuming, costly, and will often require the assistance of a professional, such as an accountant, due to the significant amount of paperwork.
If you’re heading into business with another party, then usually a partnership exists as the most stress free and convenient option, however this can massively hinge on the level of trust.
There are a variety of laws which exist around opening up your own business, however several businesses, depending on the nature of their work, will require additional licensing. A firm knowledge of any potential licensing issues is crucial if you are to avoid potential fines, or worse, involuntary closure.
Use this Gov.uk tool to find out which licences you require in order to play music, sell alcohol or sell food.
Ensuring that you have the right insurance for the work you are carrying out is crucial when it comes to avoiding unnecessary expense. Regardless of whether you are a sole trader or a major global company, finding the right insurance for your business can prove to have make or break effects. Take for example farming insurance, it will bear little resemblance to that of dog walkers’ insurance provided by us here at Cliverton.
As you may be working from home in a freelance fashion, it is worth noting that business insurance is not essential, however by updating the home insurance to include appropriate commercial property insurance, risk is significantly reduced.
The legal stuff
Unless you are going to tackle everything by yourself, it is likely that you are going to be employing staff. In doing so, it is worth taking heed of a matter of points in regard to taking on employees. Despite the fact it may seem like somewhat of a given, be sure to check that the employee has the right to work in UK. Carry out a variety of background checks including a DBS check if it proves necessary. Similarly, you need to come to a conclusion regarding how much you are going to be paying your staff — the national minimum wage being a start. All these details will need to be ironed out before a legally binding statement of employment is drawn up.
Once all the legal matters have been dealt with and boxed off, then you need to establish how you will advertise your company. Unfortunately, you will struggle to boost significant sales from word of mouth, therefore a strong marketing strategy is essential. This is a good way of planning where your business is and where you want it to go.
Although drop door mail may often seem like a wasted strategy, a survey discovered than nine in 10 people remember receiving it and approximately five out of those will actually store it away with the intention of using it at some stage.
One way of gaining easy publicity in a cost-efficient manner is to get involved in a newspaper advertisement, however they must be written properly. Just as print has a significant audience, it is vital not to neglect online — a strong presence on social media can be the cheapest method of advertising with the biggest possible reach.
Research has discovered that clients of local small businesses all live within a five-mile radius. Therefore, putting up the likes of outdoors banners and signs is an easy way of attracting potential customers. These displays are cheap, durable, and following the statistics suggest that a customer could perhaps see the signs 60 times each week.
Setting up a business is by no means an easy feat., disregarding the day-to-day running, even the name and the initial blue prints all require significant consideration and planning. However, following the above steps, combined with in-depth research, should provide you with a general basis of how to get started.
If you plan to work with animals, contact us today and see how we can help ensure that you’re correctly insured.