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Starting your own business

Entrepreneurs say that autonomy is the most important motivator in starting up their own business, research by the Department for Business Innovation & Skills has found.

Are you an entrepreneur and looking to start your own business? If you dream of greater freedom at work, this blog post briefly outlines the different steps you need to take before you start a business.

Business idea

All good businesses start with an idea; this can be either a product or service. 

Once you have your idea, it is important to protect your intellectual property to prevent anyone else from purchasing it. Copyright and design protection are automatic, while trademarks and patents which protect products and brand images have to be applied for. 

Research your market

If you have a business idea, it is important to test it with potential customers to see if there’s a demand for it. This will allow you to identify and fix any problems before you invest money into your business. 

To research the market, you need to do the following:

   •  identify potential customers and their needs

   •  have a basic or prototype version of your product/service for testing

   •  test the product/service with customers and collect feedback

   •  identify potential competitors in the market: what can you offer that’s different? 

Develop a business plan

Once you have done your research you can develop your business plan. This is where you can make changes to your idea based on the feedback from customers.  

If they are any problems, go back and test again until your product/service is ready.

A business plan should outline the customer needs you’re aiming to meet and how this will make a profit. 

Funding 

Once your plan is developed you can invest time and money into your product/service. 

There are several sources of external funding available to start up your business. 

The Funding for Lending Scheme (FLS) can help provide funds, improving credit conditions for your business. The scheme allows commercial banks to borrow for the Bank of England cheaply. Banks can then pass this on when they lend to businesses.

Bank loans can also be useful to support your business. Loans can be used to cover your assets such as vehicles and computers, and are not repayable on demand, meaning that you’re guaranteed the money for the whole term. 

Partners and suppliers

Whether you set up your business as a sole trader, partnership or limited company, your business will involve partners, suppliers and distributors to help develop and sell your idea. 

Partners can help you share responsibilities including risk, funds, expertise and sharing contacts. If you’re running a service, suppliers will be required for materials and equipment to run your business. 

Registering your business

Before you start trading you must register for tax with HMRC. 

There are different risks and benefits depending on your set up. We can help you register your business and deal with your tax affairs and returns to HMRC. Speak to an adviser today.