There can be many perks to working your way up in a company, but it’s not for everybody. Some people are born with entrepreneurial tendencies or develop them one day, beginning to dream that they’ll start their own business and work for themselves. So, if that’s you, how do you start making that dream a reality? By starting with the basic steps (and questions), we’ve broken down below that put on the path to beginning your entrepreneurial journey and owning your own business.
The basic questions & planning
Okay, this might sound like stating the obvious, but to start a business, you’ll need to answer some basic but fundamental questions, including but not limited to:
- What are your strengths? It would be best if you found out where you excel and where your weaknesses are; this will allow you to improve on or augment your weaknesses with complementary skills from employees you hire.
- What are you knowledgeable about? Figuring out where your experience lies and what you have a good level of knowledge about is key to figuring out what kind of business you should start.
- What interests you? At a basic level, you need to be interested and thus motivated to pursue whatever your business may be. Ideally, it would help if you were interested and passionate.
- Who is your target audience? You need to know the demographics, needs and wants of the people you’re trying to reach and ultimately sell too.
- What structure will you choose for your business? Choosing the right structure for your business can be critical as it can drastically change your operational requirements (sole trader, limited company, partnership…).
- What will be the location of your business (dictating the clientele and customers that will ultimately make your venture a success, i.e. if your business is solely aimed at those of pensionable age, setting it up online probably isn’t the best idea).
- Will you run your business from the comfort of your home, or will you rent somewhere to run your business from? Depending on this, there are other responsibilities for a business owner to consider, depending on what and where your business is (such as business rates).
- Will your business need a license or permit to operate? (as is the case with many foods and entertainment businesses).
- Does your business need insurance and if so what types of insurance? (i.e. key man insurance, professional indemnity insurance, public liability insurance…)
- How will you be selling goods or services and what are the rules? For instance, there are many rules and regulations to follow if you are selling products online or buying/selling from abroad. You’ll also need a product liability insurance policy.
- Are you planning to employ other people straight away? If so, there are responsibilities you need to adhere to. For instance, when you become an employer, you have the responsibility of running payroll, paying national insurance and providing workplace pensions to eligible staff among other things (further information on employer responsibilities and contract types can be found here).
These are just the basic questions you need to start answering. You’ll need to answer many others as well and begin writing a business plan that clearly and coherently shows what you’re going to do and how you’re going to it.
Raising business finance
Once you’ve answered the basic questions and created your business plan, your most likely going to need some money to start. When it comes to business funding or finance, there are a few different options to choose from.
Startup loans
When it comes to getting an early stage business loan, you can go the traditional route via a commercial bank, go for a P2P finance lender or even apply for a government-funded Start Up Loan. The latter is a personal loan of up to £25,000 with a fixed rate of 6% P.A, with a 1 – 5-year loan repayment term.
Crowdfunding
Using crowdfunding is also an option when attempting to fund a business. Pages like Just Giving, Crowd cube and Seders are designed to enable a large number of people to give money of their choosing to help friends, family or even acquaintances in raising a sum for a good cause, or investment.
Selling assets
If you own assets that have some value you might consider selling them to release value. For instance that might mean considering selling your car or even selling your home either directly or by using a service like ReadySteadySell.
What next?
Okay so you’ve got your plan, you’ve got your finance, and now you need to get going. There is a lot to consider when starting a small business, and yes, a lot more than is listed above.
On one final note, much work is involved, and it’s a risky manoeuvre, but is it worth it to sit back at the end of it all, look at your business empire (however big or small), and think, “I worked for this”?