How to start a business in five steps
Do you want to start a business and join 15% of the UK workforce registered as self-employed? Well, you are in the right place! In the UK, creating your company is exceptionally easy and relatively low-cost. Yet – most people end up hitting a roadblock or never fulfilling their dreams.
Noirwolf’s friendly team is here with an easy-to-follow, 5-step guide on how to start your business and help you focus on the essentials. So, how do you do that? We will tell you.
Why do people start a business?
Entrepreneurship is a path that many people choose for various reasons. What motivates people to start their own business and become their boss? It is crucial to understand the driving force behind this decision. Evaluating your motives will help you determine your chances of succeeding. Can you handle financial crises? Are you willing to put in extra hours to adjust your strategy, even sacrificing your leisure time? If you cannot answer this question, it would be beneficial to explore further why you want to pursue entrepreneurship. Let us examine some of the most common reasons why entrepreneurs embark on this journey, which may be the exact reasons why you are considering it.
Depending on your business type, location, and staffing, the requirements for starting your business setup vary.
How to successfully start a business
Starting a business successfully requires careful planning, hard work, and dedication. It is essential to do thorough research on your industry and target market. Develop a solid business plan, set realistic goals, and create a budget. Build a strong team, establish a brand, and market your business using various channels. Stay flexible and adapt to changes as needed. With persistence and perseverance, you can turn your entrepreneurial dreams into a successful reality.
Let’s start by helping you with some tips for how to start a business in the UK.
1. First things first, draft a business plan to help you start your business
Writing a business plan is essential for a small business owner. It will help you set your objectives, develop ideas, and plan short- and long-term goals.
Additionally, it will make you aware of everything you are trying to achieve. It will help you present your business idea to people outside your business, such as a bank or potential investors willing to invest in your company.
Regardless of how you intend to use your business plan, framing it correctly, honestly, and professionally would be best. Remember, your business plan is the first introduction of your business to the outside world. Therefore, make sure that it is nothing short of the best.
We highly recommend you review the business plans of businesses like yours to understand the format and brand positioning.
An expertly written business plan is well-researched and contains budget forecasts. Business Plan guidance is available here on the HMRC website, and free business plan examples (all industries) are available on plans.
2. Financial Analysis
To support your business plan, you will typically require supporting financials to complement your business plan documents. Typically includes:
- Personal finances (i.e., survival budget, savings)
- Startup costs
- Sales Forecast
- Cashflow Forecast
- Profit and Loss
- Assets and depreciation
- If required: Discounted Cash Flow (DCF) and critical figures for investors
GOV.uk provides links to templates and examples of business plans. The leading banks offer helpful tips for constructing a business plan; Barclays and Lloyd’s sample business plan provides explanatory text, and HSBC asks a structured set of questions.
3. Business Name and Location
Once you have the business plan and financials ready, it is the right time to establish your business with Companies House – choose a name and address, making sure your company name is unique.
If you are the sole proprietor, your name can also be the business name.
A business address is essential in the UK for tax purposes and to register your company with Companies House.
4. Sorting banks, accounts, and finances
Successful businesses maintain separate bank accounts for the owner’s funds, manage a budget (forecast and actuals) for ease of operations, utilize a simple bookkeeping system, and potentially, an accountant.
At a bare minimum, you must record all sales and costs in a book, spreadsheet, or Word document.
5. Take care of tax and legal requirements
Setting up your business requires you to do things right from square one. One such critical element to take care of is the tax and legal implications.
To avoid any difficulties, it is advisable to register your business for Self-Assessment to pay taxes.
If you have decided to set up your company as a private limited company or limited liability partnership, you must also pay corporation tax on the profits.
In addition to taking care of taxes, you must abide by the UK legal requirements. It would help if you satisfied all regulatory laws related to running a business (i.e., employer liability, licensing, data protection, health and safety, and so on).
Planning is essential when you start a business.
These steps are straightforward and are easy to accomplish. Additionally, free UK startup information webinars and courses are available from Start&Grow.
To be successful, regardless of your motives, planning is an absolute necessity. This is especially true when starting and growing a business. Preparation is often the key to success for an entrepreneur. If you’re contemplating starting your own business, you mustn’t leave anything to chance or get caught off guard by unexpected events. With robust planning and management tools like LivePlan at your disposal, there’s no excuse for aspiring entrepreneurs not to have a well-defined course of action. Your planning should include regular forecasting and preparing contingencies for probable scenarios.
Sounds Tough? Noirwolf is here to help you start a business!
Undoubtedly, starting a new business can be a stressful experience. You might already be running a few ventures and falling short of time to invest in this new idea. Or you might have a 9-to-5 job with no time to work on your startup. Irrespective of your case, Noirwolf is here to help! We help people looking to start their business across the UK and internationally.
Get in touch with Noirwolf.
Would you like some guidance on the five steps to start a business? We are here to help if you need us. Our small business consulting and leadership coaching services are here to help! We’ll work with you to scale your operations and achieve your goals. Plus, we offer a free 30-minute consultation to ensure we fit your needs correctly. Let’s get started!