If you’re dissatisfied with your job or if you’re worried that it’s unlikely to last or if you simply want to have more control over your working life, starting up in business for yourself can be an exhilarating move. It’s a very different experience from being an employee, however, and you’ll have a lot of adjustments to make along the way. These are the key things you need to think about from the start.
Are you ready?
Simply having an idea for a business doesn’t mean you should leap in feet first. You need to ask yourself if you’re ready for this. It’s highly unlikely that you’ll make money straight away so you’ll need to be in a good financial position with savings that can last you for a few months. You’ll need to be prepared for long hours and late nights, and confident that your loved ones are ready to bear with you through that. You’ll also need to make sure that you understand all of the basic tasks involved in running a business and can either handle them yourself or find competent people to handle them for you.
Making a plan
Even if you’re planning to work as a contractor with no big upfront investment required, it really helps to draw up a business plan, complete with cash flow estimates. this will help you to get a clearer idea of what you have to do, what your targets are and – as you get going – whether or not you can meet those targets. Make lists of suppliers for materials you need and distributors for any products you produce, and contact them to make sure you’ll be able to work with them. Set up a website, work out how you’re going to direct people to it and identify other ways in which you can attract attention to your business.
Sorting out tax
As soon as you set up in business you’ll need to register with HMRC and start keeping accounts, even if you don’t anticipate turning a profit in your first year. At the end of the year, you’ll need to submit a tax return and pay your National Insurance. If you don’t feel that you can cope with this side of things, consider signing up with an umbrella company. In this arrangement, they will take care of your tax affairs and pay you what remains – in every other way you’ll be self-employed but you’ll still technically be an employee.
If you need to store materials for your business, this can make life difficult – especially if you’re working from home or are hotdesking. Renting storage space as and when it’s needed is usually more practical at this stage than investing in new premises. It’s also possible to rent meeting rooms if you don’t have anywhere suitable to meet with important people at your premises. You should also think about how you arrange your office, even if it’s home-based, to maximise storage space and make sure you can keep key items like your accounts and product designs secure.
Building your networks
To be successful in business you’re going to need customers and the chances are that most of those will ultimately come from personal references. This makes networking incredibly important. It’s something you can start doing before you leave employment, and former colleagues may well be able to help. Networking can be done both in-person and online, through social media. It’s also helpful when it comes to finding suppliers and distributors and keeping up to date with what’s happening in your sector.
Building your skills
No matter how good a grasp you feel you have on your key skills before you set up on your own, there’s always more to learn. Visit your local small business centre to find out if there are free or low-cost courses you can take to help you improve what you’re doing (these can also provide a good opportunity to network). Take every opportunity to learn from others in your sector. Study how your rivals’ approach what they do and pay especially close attention to your own mistakes and any complaints you receive, which can provide really good learning opportunities.
Starting out on your own is a big step and not everybody who attempts it succeeds – though many of those who fail do much better on their second attempt. Although you will also need a bit of luck, the real keys to success are good planning and hard work. If you’re prepared for this, now could be the time to take that step.