It takes more than a good idea to create a successful business. Eight of ten new businesses in the UK fail within eighteen months. But, whilst some ideas are simply not commercially viable, many good startups fall by the wayside because of bad advice, insufficient research or a lack of startup preparation,
Before committing to a new project, handing in your notice and throwing yourself into a venture, look sensibly at the advice and resources in the public domain to new businesses in the UK. There is a great deal of information out there. Many people have documented the common pitfalls and mistakes made during the early years of their enterprise. Heeding their advice and learning from the mistakes of others could make all the difference so use your time wisely.
Research, research, research.
Often hailed as the most important aspect of startup preparation or any new business is market research. Market research is usually described as either primary or secondary. Primary being research you conduct yourself and secondary being gathered from existing sources. This stage may deliver surprising results on the marketability of your business. It allows you to fine tune your product or service before you draw up a business plan.
- Is there a big enough demand for the product?
- What is the target market? Where are they? How can you reach them?
- Who are your competitors and how have they arranged their business?
- What price is viable for your product or service and what business model will be appropriate to deliver to deliver it to your customers?
The benefit of unbiased market research cannot be overstated. Remember, you are not your customer. The more information you have the better prepared you will be for every subsequent step towards a successful business. Fortunately there is a great deal of information available online and for free.
Check your Figures
From the inception of your idea, keep a record of the likely costs of each part of the proposed business. Update it as your ideas change or new information comes to light.
A common complaint from new business owners is how long it takes to turn a profit, especially with underestimated or unforeseen costs. A realistic idea of the money you will be paying out and leaving an amount of surplus for unforeseen circumstances can make a big difference in the first year of a fledgling enterprise.
It all adds up. Look into the likely costs of housing your business, staff, insurance, legal fees, accountancy, hardware, cleaning. Add it all to your budget. If you can, get quotes for services or equipment at this stage to get the benefit of choosing before you are under pressure to do so.
Take everything you’ve learned and put together a realistic, or even pessimistic budget.
Make a Business Plan
A solid, well considered business plan is an essential resource for obtaining finance and producing a realistic estimate of how long it will take to develop your new venture. This should be a highly presentable document as you others will be relying on it at every stage.
As part of your startup preparation, combine the information your market research has delivered with your budget. Use that to construct a timetable for each stage of your business.
Look After Your Brand
A lot of time can be expended thinking of the perfect name for your business or service. When thinking about the public face of your startup, keep in mind you will be looking for a domain name and a logo at the same time. If you will abbreviating your company name for the logo or website you will need to check who else is using the same letters and consider any clashes between you. You will find it is not just businesses but also charities, abbreviated definitions, social groups, campaigns, geographical areas and combinations of the all of them. Check thoroughly across the internet especially looking for unsavoury connections and anything which will dominate the search results for your business name, making it hard to market online. Try not to be precious. If it is gone, it is gone and you will have to think of another.
You will need a logo of sorts, even if you are not running a service you feel will need a visual brand. These days, your email and online profile will often require a picture. A professional looking logo has an impact on your communication with your customers and suppliers. Don’t get left with your holiday snaps from facebook being the first thing your customers see. Get this sorted in parallel with the name and your email address to avoid headaches later on when you are busy.
Get financial advice and get good legal advice before you need it. Accounting, effective invoices, building employment documentation, registering your company and licensing logos all of these benefit from solid professional advice.
It does not have to break the bank, but skipping this part can cost a lot and even shipwreck a good business if everything isn’t in order
The last item on your startup preparation list should be you. Before making the final steps, take a look at yourself and your situation.
- Do you have the time? Family, social commitments and relationships famously all take time to reconcile with a new business.
- Situation. Do you have the finances and support necessary for this?
- Will. It takes a good attitude, a thick skin and a lot of perseverance to keep a business afloat during the first couple of years, even with good planning and solid advice. There will be bad times as well as good. It takes a bit of grit and determination because it is your business so, ultimately, the buck stops with you.
Notwithstanding all of the above, remember what the aim of all of this hard work and planning ultimately is. The opportunity to create something unique and personal, being your own boss and ultimately being happy with your work and proudly standing next to your achievement.
Good luck with your startup preparation . We’re rooting for you.