Important things to consider when starting up a small business

Many of us dream of being our own boss and running our own business, but the reality of it can seem quite daunting. After 15 years working with small businesses, I have been able to see the highs and the lows. I've seen people who have never made it past the business plan stage, and people who have grown a business to have a multi-million-pound turnover.

Despite what many people may try to sell online, there is no clear playbook. If there was, we would all be millionaires. But there are a lot of commonalities that exist in the success stories. Below are some for you to consider

Have Clarity

There are two things you need to be clear about before you start a business: why you want to run a business and what the idea is.

Why do you want to start a small business?

This isn't a question that you need to answer for anyone but yourself. It's not a question to make sure you are valid in starting a business. It is purely a question that will help you determine if starting a business is the best option.

For example, if you're looking for stability or more free time, starting a business might not be the best option. To make a business successful, you'll likely be working a lot more than in an average job, and there is no guarantee that you'll have money. In fact, it might be months before you can pay yourself.

However, if you want independence, that might be enough drive to get you through those more difficult moments.

Your 'why' is the thing that will keep you going. The thing that you will remind yourself of often when trying to build a successful business.

What is your business idea?

Some people have clarity in the why but not the actual idea. Speaking from my own experience, not being clear on the idea will lead to burnout. You will try to focus your energy in a million different places and likely not accomplish a whole lot.

Having clarity in your business idea will help you stay focused. It becomes your centre of gravity.

For example, you may want to start a business that's a salon. You have a vision of offering all kinds of beauty treatments, but you don't have clarity in the initial part. Having clarity would mean that you'd like to open a salon that specialises in lashes and brows to start with. Then you can let the expansion happen naturally. It keeps you focused on building a customer base who will get to know you and your business. Whereas if you try to do everything, it may seem untrustworthy, and you may also struggle to keep up the standard you'd like.

Make A Business Plan

Once you know you want to start your business, it's time to make a business plan. Usually, people think they only need this if they are trying to acquire funding, but it's important to have for yourself, even if you never show it to anyone.

Your business plan will expand on that clarity we mentioned earlier. It helps you to prepare your pitch, understand your strengths and weaknesses, and it will make sure you have a plan for how you will operate.

It's also the place to make sure you've researched your competition and your finances. When thinking about your business, you may have a rough idea of costs, but in a business plan, you will need to be accurate.

For example, you may want to open up a bookshop. You need to find out how much the books will cost you, and then, using the RRP, calculate how many you'd need to sell in order to cover the rent of the shop.

There are many templates online, but if you'd like help with creating a business plan, get in touch - alexandra@zortex.co.uk

Set Up All Accounts

Once you're ready to start your business, there are a few things you need to do before you can function properly.

1. Register with Companies House (in the UK). It's a very easy process, but you do have to pay a fee when registering.

2. Get a business phone number unless you want to use your private number. It can be as simple as getting a pay-as-you-go phone and using that number.

3. Once your company is registered, you can register for VAT. You have to register for VAT if you turnover more than £90,000 in 12 months. Even if you don't, you may choose to do so, as then you can reclaim VAT on purchases. That being said, it does mean you will also need to charge VAT.

4. Open a bank account. This is where your business plan will come in handy. Most accounts are opened online now, but there are also support numbers if you are struggling. It can be a lengthy process depending on what information they need from you.

5. Build a website. Although it's not mandatory, it is extremely worthwhile. It's common practice and gives you access to a huge pool of potential clients. Of course, there's a lot of competition, but having an online presence means that at least you're a part of that competition rather than excluded. There are many easy website builders now, such as Wix, Squarespace, Shopify, GoDaddy, etc. They usually have a monthly subscription, but you also need to make sure your desired domain is available and purchase it.

6. Create social media pages.

   As well as a website, it's beneficial to have social media pages, such as a Facebook page. It's another great way of finding customers and helping direct them to your website, but also an easy way to update your customers. It's also a way to market your business for free. For example, on Instagram, you can use trending audio on your posts to expand your reach.

Build Contacts

Once you've got your business set up, it's time to start building up your contacts. This includes both suppliers and customers. It's worth finding a local accountant who can help you with your finances. You may decide to hire a consultant to help you with your business venture.

If you are a local business, it may be worth participating in local events and getting involved with the community so that your business becomes more well-known. If you're based online, you can still build contacts, but they will most likely be through online spaces.

Try to find relevant groups (either online or physically), and attend relevant networking events. The more exposure you get, the more opportunities should come your way.

It can be daunting at first, and not every event you attend may be beneficial, but it can be a great way to build contacts.

Determination

The most important thing to really remember when it comes to starting or running your own small business is that determination is key. You need to be dedicated to making it work. There are many businesses out there, and it is hard when you are doing everything by yourself. It takes a lot of time, effort and even money, but if you are determined to see it through, you are likely to succeed.

Of course, there may be moments when you need to adapt a business plan so that you don't end up bankrupt, but being determined means you will find a way to adapt. You will find a way t make your business work and make your dreams a reality.