If you ask Google, “how do I start a business?” the first website that comes up (after the ads!) is the www.gov.uk website which helps you, step by step, to set up your business with a legal entity that the government recognises. But what do you need to think about before you take the plunge and start your own business
You’ve got an idea and you think people will want to buy from you. Are you sure? Have you done some research on competitors, the market for your product or service and have you tested it? If not, or you don’t know how to, join our free Visionnaires programme and learn how.
Starting your own business is really hard, we’ve all heard about that. But being your own boss, having the freedom to make your own decisions and being in control of bringing your vision to life is a hugely rewarding experience. Think about the support you’ll need to help (link to blog on seeking help) you through the tough times – because there’ll be a few!
If you’re good to go and about to head off to the www.gov.uk website have you thought about your company name? Always Google the business names you’re thinking of to see if it already exists. If it does, you won’t want to use it as it’s unlikely you’ll be able to register it, trademark it or use it on social media handles. And that’s another thing to think about: social media. Check to see if the company name you’d like to register is already used across all social media channels because as soon as you register your company you’ll want to set yourself up on LinkedIn, Facebook, Twitter, Instagram, TikTok etc. Finally, check to see what your company name translates as in different languages. Also consider your company name, it doesn’t have to be the same as your business name. It’s pretty hard to avoid calling your business something which doesn’t exist already! So work out am that’s memorable and not used by anyone else in a similar line of business. A logo is a good idea if you can afford it.
The simplest way would be to set yourself up as a sole trader. It’s attractive as there’s little admin but think carefully as there’s no legal distinction between you and your company, so if anything goes wrong, you’re personally liable. Our friends at Chronos did a webinar for the Visionnaires community recently and told us that they advise setting up a limited company. Why? Because it’s legally distinct from you as an individual – but it does come with a lot of admin! Do your research on how to structure your business so that it works for you.
There’s no getting away from the admin when you run your own business. If you’re a sole trader you’ll need to register with HMRC and submit an annual self-assessment tax return. If you register a limited company you’ll need to pay corporation tax and file a company tax return. You must also register for VAT if your income is above a certain level. It’s really worth learning how to do this when you’re just starting out and start using an accountant soon after that. Check out courses at your local college, there’s also lots of information online if you want to teach yourself. Make sure you’ve got your head around this stuff, it’s so important you understand your own finances. I can’t tell you how many business owners I’ve come across that don’t know if they’re making a profit or not!
There’s more! Keep records of everything. Spreadsheets are fine, accounting software can also make things easier. It’s important to start as you mean to go on. Document everything and get used to doing it regularly whilst you’re still small. It’ll set you up well as you start to grow your business. The same goes for everything else you’ve ever produced as part of setting up your business: research on competitors and the market, business plans, sales and marketing plans etc.
Don’t forget insurance. The type of insurance you need depends on your business. You might need public liability insurance if you visit your customers or clients just in case there is an accident, professional indemnity insurance if your client loses money because you’ve provided negligent advice or services. Employers liability insurance is legally required if you employ anyone. There are lots of different types of insurance, again, do your research as it’s important you don’t overlook this. And don’t assume it will be expensive, shop around to get the best deals as you would with your house/car/travel insurance.
Becoming a director and owner of your own business is a big thing and should be celebrated! Especially if you’ve never dreamt that one day you’d be running your own business 🙂 Voltaire (or Spiderman’s Uncle Ben whichever you prefer) said “with great power comes great responsibility,” and it’s true of business owners everywhere. We’re the people who build sustainable businesses, employ others, give back to our local communities and pay it forward when we can by supporting other business owners just starting out – we do great things, always worth remembering that.
This is just a short blog on some of the things members of our Visionnaires community have asked us over the years. Have more questions? Join our free programme Visionnaires programme