Sergio Triay recently launched a catering business with his partner. After almost a year in business, he gives us his top tips to successfully build your business from day one.
Taking the leap from employee to business owner can be both exciting and daunting. You are faced with the prospect of failure, and consequently financial insecurity, alongside a whole number of risks as the business grows.
Here are the five things I prepared before I launched my business:
1. Do your research
Understanding the market you will be working in is key to success. From learning about your target audience and potential customer base, to scouting out the competition, it is important to find out where you stand within the market.
Ask yourself questions, such as: How’s best to capture your target audience? What are your competitors doing right and wrong?
Search for innovative ways of standing out from the crowd.
2. Make a solid business plan
Prepare a detailed and realistic business plan that reflects on your research and draws from your analysis of the sector. Providing an expert service within your area of business will create a competitive advantage and propel you, and your business, forward.
Take advantage of free resources available for entrepreneurs, such as webinars, podcasts and government websites for grant schemes and funding to maximise your knowledge of the market and business.
3. Exploit technology
Often, resources will be free of charge and easily accessible online. This allows you to explore different options and keep up to date with changes in the industry, while also reducing overheads.
Consider the advantages that come with an online business – the internet gives you access to a world of people looking for your product or service at the touch of a button and without blowing your budget.
4. Budget carefully
For most entrepreneurs, costs will be the biggest concern when it comes to setting up a new business. According to The Office of National Statistics (ONS) less than half of the UK businesses launched in 2011 were still open 5 years later. Budget carefully to avoid future disappointment.
Contrary to what many people think, starting a business in England has far less bureaucracy than in many other countries around the world. In addition, the procedures tend to be relatively quick. Less bureaucracy often means less costs – but while the registration process can start off at less than £10 for basic online services, you can easily run into the hundreds of pounds – especially if you are a registered office.
Even if you are working from home, there will be setup costs involved with opening your business. Monthly utility bills, computer and printing equipment and even office basics such as pens and paper, all add up, so keep these in mind when budgeting.
5. Really consider your funding
Be realistic about profits. For most companies, earning is an uphill climb – you should probably budget a few months of losses before a steady income comes in.
Think outside the box. Some businesses have garnered most of the funding from crowdfunding sources, so if your product or service has a unique selling point, there is a fair chance you might be able to make up a large part of your funding through this source. Crowdfunding also has the added benefit of creating public interest for your business in its earliest stages, providing you with free marketing and providing cash for your business at the same time.
If you are thinking of approaching a bank to provide you with financial backing, it is important to do so with a well revised business plan, financial forecast, and maturity prediction. You should always bear in mind the high risk involved with collateral loss attached to loan grants, which could leave you in an uncomfortable financial position.