Seven tips to get start-ups off the ground
Out of the doom and gloom of the pandemic, new businesses are sprouting up – many built around successful concepts launched and developed during lockdown.
Launching a business can be daunting and risky, to help, we have prepared seven tips that all start-ups can follow:
You must undertake thorough market research to ensure your idea will work and is competitive. This will help you to identify customers and competitors, analyse potential markets and consider the costs associated with the business.
Having conducted thorough research, entrepreneurs should be able to calculate their pricing strategy and begin to think about the development of their business in the future.
Comprehensive market research is also an important step in preparing your business plan and is likely to be essential if you want to raise capital at any point.
Assess your finances
To launch a business, you will need sufficient capital to carry out your plans. Finance is often one of the biggest barriers to launching a business and in the current climate lenders and investors are likely to be more risk-averse, which may make sourcing funding more challenging.
The finance you require depends entirely on the business you are launching. Some companies are relatively low-cost to set up and run, while others are resource and cost-intensive.
If you have properly identified the costs of setting up your company then you should be able to break the necessary investments up into three distinct categories.
Essential costs – Your business cannot operate without these.
Useful investments – These make your business more efficient but would not prevent your business from operating.
Additional investments – These offer small benefits to the business but are by no means essential or necessary.
Create a business plan
Start-ups need to have a comprehensive business plan that acts as the blueprint for their company.
If you have done sufficient market research and worked out your financial situation, then you should be in a strong place to tailor your plan to your needs.
A business plan is often a requirement for any form of financing you may be seeking and will help keep you on track.
Choose a business structure
You’ll need to decide if you’re going to start a business as a sole trader, a partnership or as a limited company.
Depending on which model you choose could lead to different tax and governance issues for you to consider.
Many businesses prefer the protection of operating as a limited company, as the liability is only tied to the amount you have invested within the business and not directly to the founders.
Establish and monitor KPIs
If you do not monitor key performance indicators it can be difficult to assess how well your business is doing. The most important growth metrics for young businesses tend to be:
Gross Profit Margin – The amount you receive once you have covered the cost of goods or services sold.
Customer Acquisition Cost – The price you pay to acquire a new customer.
Spend Rate – The speed at which the company spends its capital.
By monitoring data around each of these KPIs, you should be able to spot weaknesses quicker and also identify areas of growth in which to invest more resources.
Many start-ups find that investing in cloud accounting technology helps them to monitor and assess their performance, especially if they collaborate closely with their accountant.
Entrepreneurs are encouraged to avoid premature scaling by carefully monitoring their spending, minimising debts and keeping overheads to a minimum.
Overspending before establishing a market for your product or service is believed to be one of the key reasons for most premature business failures.
If you are carefully monitoring your KPIs and have a robust business plan in place you should be able to scale progressively.
New business owners do not have to go it alone. One of the first and most important things they can do is seek help from professional advisers, such as a trusted accountant.
A little invested early on in expertise can go a long way to helping a company survive and thrive.
- HM Revenue & Customs publishes further details of the Job Support Scheme
- Annual Investment Allowance – Time is running out
- Accounting for mobile phone use
- Time to prepare (once again) for the VAT reverse charge
- Is the Government considering a National Living Wage freeze?
- Companies House reforms to combat fraud and assist businesses
- Price of plastic bags in England to double to 10p
- New Coronavirus regulations place self-isolation obligations on employers
- Latest SEISS grants introduce new qualifying conditions
- Businesses may be entitled to insurance pay-out after important judgment
- Chancellor expands Job Support Scheme and grants to businesses facing new COVID-19 restrictions
- Government issues new guidance on the Job Retention Bonus
- Download the Government’s guide to the Job Support Scheme
- Important message to clients and friends: We are working remotely on recommendation from the PM, please read the following update
- Chancellor announces new Job Support Scheme and package of business support measures
- Change to Companies House bank detailsanies House bank details
- More than £1 billion in tax reliefs for creative industry
- Advisory Fuel Rates for next quarter come into effect
- Key dates for the Coronavirus Job Retention Scheme
- The first Child Trust Funds (CTFs) can now be claimed
- Four in five SMEs are confident over their Coronavirus recovery
- HM Revenue & Customs (HMRC) writes to 3,000 employers over furlough claims
- Government to launch new local lockdown grants
- CBILS ends on 30th September 2020
- How will you rebuild and recover? Funding launched to cover cost of professional advice
- Tax changes outlined in draft Finance Bill 2020 – 2021
- Coronavirus Business Interruption Loan Scheme expanded to more businesses
- VAT treatment of imported goods up to £135 to change under new rules
- HM Revenue & Customs publishes Job Retention Bonus guidance
- Small business Covid recovery boosted by £20million in new grants
- HM Revenue & Customs sets out Making Tax Digital plans for VAT and Income Tax
- HM Revenue & Customs sets out details of penalties for breaches of furlough and self-employment scheme rules
- Reminder: VAT payment deferral period has ended
- Banks list top 10 Coronavirus scams
- HM Revenue & Customs issues ‘nudge’ letters to people suspected of having undeclared overseas assets
- Second round of Self-Employment Income Support Scheme (SEISS) opens on Monday
- Key dates for Coronavirus support schemes, tax and Companies House
- Government extends childcare funding for families affected by the pandemic
- Green Homes Grant guidance published
- Eat Out to Help Out opens for claims
- Key dates for Coronavirus support schemes
- Eat out to help out
- New legislation introduced to protect redundancy pay of furloughed workers
- Seven tips to get start-ups off the ground
- Government confirms Coronavirus tax concessions in amended Finance Bill
- Future Fund expanded to more businesses
- Research finds lack of knowledge, information and skills are key barriers to Making Tax Digital compliance
- New corporate insolvency rules come into effect
- £84 billion of R&D tax credits unclaimed – Could you be eligible for a share of this funding?
- Government confirms Job Retention Bonus of £1,000
- Upcoming key dates for the Coronavirus Job Retention Scheme
- Paying for COVID-19: Government begins exploring tax take back
- Government confirms the next steps for the digitisation of taxation
- Government publishes detailed guidance on SDLT holiday
- HM Revenue & Customs confirms first arrest in connection with furlough fraud
- Reminder: Deferral of second payment on account
- HM Revenue & HM Revenue & Customs updates Self-Employment Income Support Scheme guidanceCustoms updates Self-Employment Income Support Scheme guidance
- Coronavirus apprenticeships guidance updated
- Download our updated Coronavirus Support grids
- Details of ‘Eat Out to Help Out’ scheme confirmed
- Guidance on hospitality and tourism VAT cut published
- Summer Economic Update
- Don’t forget to make an SEISS claim by 13 July!
- HMRC offers clarity on usual hours calculation for flexible furlough
- Coronavirus grants to businesses, employers and individuals are taxable
- Guidance published on repaying Coronavirus Job Retention Scheme overpayments
- Key dates for Coronavirus support schemes
- Government publishes new ‘Covid Secure’ guidance
- Remember to reinstate your VAT direct debit in time for your next payment
- HM Revenue & Customs clarifies repayments of Corporation Tax and anticipated losses
- Employers given 30 days to confess to furlough fraud
- RE OPENING…GET ON YOUR BLOCKS!
- Download our Coronavirus support for business timeline
- Managing Cash
- Helpful steps to improve credit control
- Top tips for improving profit
- Are you taking your business online? – Six steps to effective pricing
- HM Revenue & Customs publishes detailed guidance on calculating furlough claims from July onwards
- Further clarification issued on eligibility for second round of Self-Employment Income Support Scheme
- Government delays VAT Reverse Charge
- VAT deferral refund available
- Trade Credit Insurance backed by £10 billion guarantee
- Guidance on exceptional circumstances for higher rate SDLT refunds updated
- Whistleblowers make almost 2,000 allegations of furlough fraud
- Employees returning from parental leave continue to be eligible for furlough scheme
- Chancellor unveils changes to furlough scheme
- Self-Employment Income Support Scheme (SEISS) extended
- Coronavirus Future Fund opens to applications
- Coronavirus Statutory Sick Pay Rebate Scheme set to open for claims
- Maximum Government-backed loan amount for larger businesses increased to £200 million
- Temporary tax freeze on home office expenditure announced
- Tax treatment of expenses and benefits during COVID-19
- Money laundering supervision payment deferrals and deregistration announced by HM Revenue & Customs
- Changes to notifying an option to tax (VAT) on land and buildings during the Coronavirus pandemic
- COVID-19 – Re-build and recover – we’re here to help you get back on track
- New start-ups
- Owner Managed and Family Businesses
- Cashflow projections and budget assistance
- Tax payment plans
- R&D Tax Credits