So, you have made the decision to go it alone. You have an idea for a new business or service, which reflects your talents, skills and interests, and you want to take it to market. What do you do next?
You will first need to decide what your business is going to look like. Are you going to be a sole trader, where you solely run and own the business? If you need to involve other people, you can form a partnership. Or, you could set up a limited company, where the business is a separate entity and is slightly more complicated to create. But in this case, if anything were to go wrong, your home and savings would be protected.
You can get help with this initial decision from the library, job centre, citizen’s advice office, or your bank. There may also be a local network of small businesses which will be able to help.
Whatever decision you make, you should also think of a name for your business, as this will help your company to have an identifiable brand name. You need to register with Companies House to check that you are able to use this name.
Inevitably, you then need to think about money. Do you need funds to set up the business, maybe using loans from family members, friends or the bank? Are you going to use your savings? How are you going to live while your business is getting established? Can you get a grant to get your business started? Whatever the answers to these questions, you need to set up a business bank account to manage your business affairs. You may be able to get this service free if you shop around.
As well as thinking about sources of finance, you will need to ensure that HM Revenue and Customs (HMRC) are aware of your business. You need to pay tax on your earnings and also need to be aware of the different allowances and tax reliefs that businesses can benefit from. You should use the services of an accountant to get advice on these matters and also to help you keep detailed records of all of your business transactions.
You will also need to make decisions on health and safety, and business insurance for your place of work as well as for your car. You need to get advice on paying business tax, national insurance, pensions and any benefits that you are able to claim.
Where are you going to work from? You may decide to work from home until your business is up and running. Depending on the initial scale of the business, you may need to rent an office or a business unit. A local estate agent specialising in business premises can help you here.
Research all of these questions in as much detail as possible, as careful forward planning is essential. Remember that businesses fail because they run out of money, or the business plan has not been thought through.