10 Things To Consider When Setting Up A Business
Setting up your own business from scratch is exciting but at the same time, there’s a lot to it that you want to get right in order to make it as successful as possible. Not every business venture manages the same success as others and some may not even make it past the starting line. So with that being said, here are ten things to consider when setting up a business.
Think About Funding
Firstly, when you’re creating a business, the way you fund your venture can vary from business to business. Some will have their own savings that they’re willing to invest into the company from the beginning, whilst others would rather used borrowed money from the banks or through a loan company. Regarding the amount you borrow, it’s worth thinking about the likelihood of it failing and how much you’ll be able to pay back whether it succeeds or not. It can be a hard pill to swallow to have a business fail and then you find yourself in thousands of debt, having to pay your way out of it before you can hit the reset button.
Investors are also a good option when it comes to funding your business. There are plenty of investors out there that simply spend their millions on helping new businesses grow. They may lend the money which you then pay back over a certain time frame depending on the company’s success. There’s also the option of giving shares or stock in exchange for the money you get from them. This is something to consider carefully though as you ideally, you want to hold onto as much of the business ownership as possible. The bigger the stake they have, the more claim they have to your business.
Set Up A Seperate Business Account
Next, you’ll want to set yourself up with a separate business account. This one is important because there’s nothing worse than having a combined bank account where both your personal expenditures are coming out alongside your business expenses and your business income. The best thing to do is to keep both of them separate. With a business account, you’re also likely going to get specific perks that you wouldn’t necessarily get with a personal one.
There’s also lots of different business accounts out there and so you might want to speak to your financial advisor or team about what the best accounts are and which one you would benefit from the most.
Create A Business Plan
When it comes to starting a business from the very beginning, remember to make a business plan. A business plan is an on-going document that showcases your business in all its glory. From the basics of how it functions, it’s core values and objectives to the people who work within the company and likely have the most influence and seniority, like board members, CEO and CFOs, etc. By having a business plan, it’s something that you can show to those businesses you may collaborate with in the future, whether it’s on a joint project or as a supplier.
Again, as it’s an on-going document, it’s always going to require an update every now and then. These updates will vary depending on how quickly your business grows, so always keep a reminder in the diary to update it every so often, as and when it’s needed.
Do You Need A DBA?
A DBA is a trade name and stands for doing business as. So essentially it’s the name that you trade by, rather than what your company is registered as. It’s an alternative name that many businesses and brands tend to use. It’s something that’s worth thinking about if you’ve found that your existing business name doesn’t fit what you want to sell as a brand and therefore you want to give it a different name to go by. Some brands may use a DBA in order to create a new persona that hopefully gains more popularity than it’s original name. It’s up to you if you want a DBA but it’s something that you should try to sort as early on as possible and that way it’s likely to have more influence.
It’s worth looking into the term a little more and deciding for yourself whether or not this is something you require at this present time or for your business.
Get All The Necessary Legalities Sorted
The next thing that’s important to sort out is the legalities that are part of setting up a business. These are the registering of your business name, the taxes you’ll be paying and ensuring a record is kept in order to do them properly. There may be insurances and contracts that need writing up in order to protect your business and to protect those of your staff members when you come to hire them for the first time.
Having a legal team or individual to oversee all the legal jargon and documents is something that will provide useful and to avoid getting into a sticky situation. It’s likely to be something you use on an on-going basis to make sure everything is being done by the book. It will also offer that protection that you might need, should someone come after your business or you have a legal battle that needs fighting on your behalf.
By not having any legal support in place, it can make things a lot more tricky as a result and you may be putting yourself at risk as a business. Even if you have a legal company on retainers, that’s going to be helpful.
Hiring staff is certainly a great step in the right direction and it might be something that your business needs at some point down the line. When you set up a business from day one, you’re likely to be your only employee or you may have a partner who two going into business with you. You shouldn’t have to hire anybody until you’re needing a role to be filled or you’re at breaking point in terms of your workload. Every individual that comes into the company needs to be able to bring something new to the table, so it’s important that you make the right decisions when necessary.
Outsource What’s Needed
Outsourcing is a great way to lighten your workload without needing to hire anyone permanently. This service works by hiring the services of contractors or freelancers to get the work done that you need and you only pay for that amount of work needed. With outsourcing, you don’t need to pay for their holiday, sick pay or other typical employee benefits. It can be a great option for both big and small businesses who aren’t necessarily wanting to hire for roles that might not be substantial enough or warrant taking on another responsibility of additional staff.
Think About Work Location
Nowadays, a lot of businesses are working remotely, particularly due to the pandemic. However, there was already a shift in start-ups and new businesses going totally remote instead of working from a physical office. There are many benefits that can come from working remotely which include not having to pay for the expense of hiring or buying an office space. What’s the point of doing so if all the work you do as a business can be done from the comfort of your own home? The only times where you might need to meet your staff, can be done so in a shared work space that you hire every so often.
If there isn’t a need for an office, then don’t get one! However, if you do need one, think about an ideal spot in which staff will be able to get to.
Start Small & But Think Big
Any business needs to start small and steady because success doesn’t always come overnight. However, when it comes to the bigger picture, it’s important to have dreams that exceed your expectations. By thinking big, you’re likely to achieve that level of success one day. Believing in your abilities to succeed is something that you should always have, rather than thinking that everything you do could fail or be useless. It’s true that you’ll make many mistakes and failures, but they’re all going to be worth it in the end, offering a lesson that will only make you more successful going forward.
Prepare For A Lot Of Hard Work
And finally, be prepared for a lot of hard work. Rome wasn’t built in a day and neither is your business. Many will fail because of the amount of work that’s required. When it comes to a business, you need to be living and breathing it both night and day. By spending more time on the growth of your business in those first years, it’s going to hopefully pay off greatly in the future. You get what you put in after all!
Use these tips when setting up a business and fingers crossed, your business idea might just become the next big thing.
Categories: Outside Contributors