How to Successfully Start a Local Business
Like anything good in life, owning your own business comes with its highs and lows. It can be an extremely rewarding experience – one that may sort you out with a job that you’ll enjoy for the rest of your life – but it isn’t without its struggles. One of the things that people struggle to get to grips with the most is the initial start-up process. Even if it’s something you’ve done in the past, it can prove to be a tricky and sometimes overwhelming task. Even more so with the sheer amount of thriving local businesses in Kent. However, don’t fret just yet. Setting up a business is much easier if you break down the process into steps. The first step in how to successfully start a local business is to start researching your local area, and the businesses within it.
Do your research
We know it’s boring, and that you’re probably itching to get down to the nitty-gritty of starting your business, but research is one of the most important parts of the business start-up process.By now you should have a rough idea of what kind of business venture you wish to begin. It doesn’t have to be a fully formed idea, just something general (for example, a vintage clothing store in Kent).
The three key things you need to research at this point are:
- If there is any interest in your local area for your business venture (or if there will be in the near future)
- Take a look at the competition (Google is your friend)
- Business start-up costs
For the former, it may be wise to conduct a short survey in a shopping centre, ask around friends and family and perhaps create an online version to share on social media. The purpose is to find out what potential customers there might be for your product/service in your local area. if you don’t have customers then you don’t have a business.
If there are already businesses of your kind in your area it could indicate there will be less interest in your business venture. Don’t be discouraged. There’s nothing saying that you can’t start another form of business, or modify your original plan slightly by looking for a unique selling point. Ask yourself why customers will buy from you and not your competitors?
Business start-up costs
A simple list of expenditure and income will suffice to start. What costs will you incur to start the business e.g. equipment, licenses, premises, graphic design etc. What ongoing costs will the business incur e.g. renewal of insurance, licenses, website domains, wages, rent etc.
For your income, you will need to work out what you will charge for your product or service, and how much you will need to sell in order to make your business profitable, not forgetting the costs you have incurred above. You may well have to estimate some of the figures you expect to receive on a month by month basis but why not use this as a target income for your business? More on cashflow and forecasting here…
Once you’re set on what sort of business you’re looking to start and you’ve completed your research you can begin some of the more formal parts of starting your business
The start-up process for your business is going to vary massively depending on you and your business but as a general guide we have identified some key points below:
- Name your business
- Choose a legal structures e.g. sole trader, ltd company and register your business
- Set up a bank account
- Set up necessary insurance (You’ll find Public Liability Insurance is essential)
- Identify National Insurance/ VAT arrangements
- Register for any licenses that you may need to run your business legitimately. This will vary depending on your business type. For example; you would need to apply for different licenses for charity work, for agricultural work, food preparation etc. because of the nature the work involves.
Some additional thinking points are: How will you promote the business? Website, social media, networking? Where will you run your business from, can you run it from home, do you need an office or retail premises? Take a look at building your brand so people can identify your business.
There’s a lot to think about and if you’re already feeling overwhelmed, don’t worry; it’s totally normal, break your tasks down in to manageable chunks.
Hiring an employee
Congratulations…You’re now officially a start-up, you’ve put a lot of hard work in and your business is booming. Things are getting a little bit busy, so much so, that you’ve thought about hiring one or two people to help you out. Hiring an employee or two is going to be massively beneficial for you and your business, but it isn’t without a little bit of hard work. So how’s it done?
Before you begin looking for staff, you’re going to have to brush up on your knowledge of employment law (if you haven’t already, that is). Put simply it concerns anything that mediates the relationship between employers, workers, the government, and trade unions. It’s a lot to take in, we know. It concerns everything from employee rights, to what’s included in their employment contract, to how you manage your employees.
First things first; the employment contract.
The contract can be verbal, but it’s always much more professional and convenient to have a typed one that every new employee can sign. It will be much easier to modify should any changes need to be made.
Whatever the nature of the contract, it must set out four key ‘terms’:
- Employment conditions
Both the employee and employer have to abide by the contract until it ends (this could be for a number of reasons, such as an employee being dismissed, an employee giving notice, or if the terms are mutually changed).
There’s plenty of information available on gov.uk to help you out. If you’re still struggling you can always talk to an employment solicitor or lawyer who will be able to help you look in to the finer details.
That’s not all…
Every business start-up journey is different and we are well aware that we have only just scratched the surface here but we hope you have gained a useful insight and feel better equipped on how to successfully start a local business.
There’s no doubt you will discover many challenges, successes, failures, lessons and fun on your journey in to business. Some you may have expected and some not – You will learn a lot! Take those good times and relish them, be proud of what you have achieved! Also remember in those tougher times and ‘I don’t know’ moments there’s always support available to get you through, whether it’s a solicitor, lawyer, accountant, business adviser, events etc.
We would like to thank Thomson, Snell and Passmore for their input in to this business start-up article. A leading law firm in Kent providing top solicitors and lawyers with a wealth of knowledge and expertise in employment law and redundancy.
Great article - what about having the soft skills and the mindset to run a business?