Starting your own business may have been a long-held ambition or may be something that has been prompted by circumstances. Whatever the reason, you may feel daunted at the prospect. There are lots of things to consider, but if you follow these top ten tips for setting up your own business, it will help to set you off on the right path.
- Have a Unique Selling Point
A unique selling point, or proposition, is what makes your product or service stand out from the rest. A USP offers something unique and is the reason your customer will buy from you. It’s an important part of your marketing strategy for appealing to new customers.
- Do your Sums
Be realistic with your budget and prioritise your spending. There are many ways to fund your own local business, from savings and loans to help from family and friends or government grants.
There are many government grants available when starting up your business, including over 200 grants for small businesses. If you are starting a new business, rather than being an established business, government grants can help save money on premises and rates or for help in buying IT equipment.
- Do Your Research
Market research will help you to better understand your target market and competitors, enabling you to produce a perfect business plan. Assess the legal aspects of your industry: employment law, health and safety, tax and National Insurance.
- Know Your Target Market
With the current state of the economy, knowing your target market is more important now than ever. When you start a new business, you need to consider and communicate who your business is for. Conducting market research will ensure you are targeting the right people, so send online surveys, engage with potential customers through social media and hold focus groups.
Data is all important: consider Data Acquisition Services that have taken the hard work out of finding your target audience. Use verified and appropriate consumer mailing lists which have been run against the Mailing Preference Service (MPS). Consider creating customer personas to represent the key traits of your audience, based on your data.
- Write a Business Plan
A business plan is an essential written document that describes your business and gives an overview of your company’s future. You will need a business plan to secure investment or a loan from a bank. Within your business plan you should outline your objectives, strategies, sales, marketing and financial projections.
A business plan helps you to:
- formulate your business idea
- find potential problems
- set out your goals and how you will achieve them
- measure your progress
- Know Your Competitors
Knowing who your competitors are will help you to understand the marketplace and assist you to make your products or services stand out. Knowing what they are charging will help you set your prices competitively and will mean you can respond to rival marketing campaigns. There are several types of competitors: direct competitors, indirect competitors, substitute competitors and new entrants, who are new to the industry offering the same products or services.
- Register Your Local Business
Most businesses will register either as a sole trader, limited company or partnership. Find out more about registering your business on the government website.
- Open a Small Business account
Set up a business bank account to keep your personal and business spending separate. Most accounts come with charges but different banks will come with different services. As a new local business, keeping costs down is crucial: free banking services for the first few months is a useful feature of some accounts. Consider how you prefer to bank: is having 24-hour access to a bank account important? Online and mobile banking can also offer many benefits in addition to 24-hour access, such as secure transactions, automated payments and minimal overheads.
- Take out Insurance
Business insurance must be a priority to protect yourself and your business. Employers’ liability insurance will compensate employees who become ill or injured through work. You can be fined £2,500 for every day you’re not insured. If you have vehicles for your business, you’ll need commercial motor insurance. Professional indemnity insurance is required by certain industries, professional bodies or regulators to compensate a client if you make a mistake that causes them either financial or reputational loss. Other types of insurance may not be required by law but may need to be factored into your business planning and budgeting.
- Market your business
Marketing your business will help it grow and reach its potential of Return on Investment (ROI). Direct marketing allows you to target specific groups of customers with customised messages. You can focus your marketing efforts where they have the highest chance of achieving results. Take the time to research and identify the customers who are most likely to need or want your products and services.
Some of the most common forms of direct marketing are:
- Targeted online display ads
- Mobile and SMS marketing
If you feel direct marketing is not your forte, choose a company who can come up with a strategy on your behalf. Using an outsourced team often costs less and delivers a better return on investment (ROI), as it generally gives you access to a wider range of expertise.
Starting a new business, as with many things in life, is easier if you bounce new ideas and plans with people you trust. Join appropriate industry associations or meet and converse with fellow entrepreneurs. Running a new business should be exciting and interesting and, hopefully, make you money.
Following these tips should make starting your new business both a smoother and less stressful process.