Starting a Small Business
Most new business starts from a great idea, from spotting a gap in the market, and the entrepreneur has a vision of what might be. Unfortunately, the difference between success and failure in a start up business is not because of the idea, it’s usually because the management lack some specific skills. That could be sales and marketing, cash flow planning, time management or simply the administration.
Small business can fail because they are too successful as well as because they don’t have enough customers.
There is lots advice available; some of it is very good, but there’s also a lot of rubbish. If you know someone who has already started their own company, talk to them. Find out how they started, how they organised their company, how they complete their accounts, what mistakes they made and what they would do differently if they were starting again tomorrow. Talk to a business adviser, bank manager and accountant – but check out their credentials; ask them what experience they have of your industry or business sector. Selling in a B2B (business to business) environment is different to B2C (business to consumer). The service sector is different to manufacturing. Retail is different to wholesale. On-line or e-business is different to face-to-face. It’s important to speak with people who understand the differences and have commercial or industrial experience.
Have a look at each of our guides for further tips on starting a small business.
Sole Trader, Partnership or Incorporation
One of the first things to consider when starting is how you are going to organise your business, several options are available including being self employed, forming a partnership, or starting a limited liability company registered at Companies' House. You could even buy into a franchise, which is already set up. Have a look at our company formations guide.
Registering for VAT
Many small companies may not need to register for VAT, but for some it will be an advantage to register. If you have high start up costs then it might be worth looking at this as you would be able to reclaim the VAT element on your costs. Whatever path you choose ALWAYS keep all of your receipts. It’s possible to reclaim VAT retrospectively if you decide to register at a later date, but you’ll only be able to do this is you can prove that you have paid VAT.
Grants for starting a small business
There are many starting grants available for starting a small business; we have provided contacts for getting a business grant.
There are so many bank accounts available. How do you choose which one? If you are looking for money for starting a business the bank may be the right place to apply. Look at the Company banking guide.
Will you benefit from having a web site? A good quality web site can be an excellent way to get customers to come to you, offering you a way of presenting your business to prospective customers 24 hours a day, seven days a week. The costs of setting up are really much smaller than you might imagine. Get your own domain name – www.yourcompany.co.uk - if nothing else it will provide a shop window for your prospective customers, and you’ll be able to use a professional e-mail address rather than a yahoo, MSN or hotmail account. Click on this link to get your own site or call us to discuss in more detail. If you only want an email account with your company name then click here.
You will need insurance, but which types of insurance are right for your small business. This depends on what you do and if you need protection in case of mistakes.
Every small business needs a plan, especially when starting, without a plan there is more chance that the business will fail. These can be from the simplest of plans to a full cash profit and cash forecast required to raise finance.
How to find professional help?
There are many professionals who can advise you on business; this is a short guide on how to find accountants and solicitors. Vector Accountants is part of a global network of professionally trained and accredited business advisers with industry and commercial experience – real people who have run real business, spread across 28 countries. If we aren’t able to help you directly the chances are that we know someone who has first hand of exactly your challenge.
Starting an eBay business.
Many successful businesses sell on eBay; here is a short guide on starting to sell on eBay.