So you’ve decided to start a small business. Fantastic! You have a great idea, maybe even a great name already picked out. But what comes next? What are the things you need to do to get off the ground?
The process can vary greatly depending on the type of business, but there are a few steps you should take no matter what you plan on doing. These five steps will help you get up and running as quickly and efficiently as possible.
Write a Business Plan
You might think you have everything figured out, but until you have it down on paper in a business plan, it’s all just an idea. Writing a business plan will help you develop a solid timeline, make good decisions in the future, and keep you motivated to stay on track. The importance of a good plan can’t be overstated.
The US Small Business Administration has a great tool for creating a business plan at sba.gov/tools/business-plan/1. You’ll need to create a free account to get started.
It’s important to make sure that you’re registered as a business to avoid any potential legal or financial troubles in the future. The process isn’t too difficult, but it’s best to follow the guidelines posted on gov.uk to make sure that you don’t miss any steps.
Head to gov.uk/set-up-business/overview to get the information you need on registering, VAT, employing other people, and the other information you need to get legally set up.
Establish a Web Presence
It might seem too early to get a website and some social media accounts set up, but they’re absolutely essential tools in today’s marketplace. If you aren’t online, how can you expect anyone to find you? There are plenty of places you can get cheap hosting for your website; check out HostGator, GoDaddy, Bluehost, and 1&1 Hosting.
A Twitter, Instagram, or Facebook account can also be very useful; we’ve discussed the benefits of social media for small businesses before, and they’re significant. You can get in touch with customers, do market research, offer discounts and coupons, and do all sorts of other things that will put you ahead of competitors who aren’t using social media to their advantage.
Prepare Your Product or Service
This may seem like an obvious one, but it’s really important, and it’s possible to overlook it. Make sure that whatever product or service you’re selling is ready to go. If you put up a website and get an order, and you can’t send out the product immediately, your customer isn’t going to be very happy!
You don’t need a warehouse full of stuff, but make sure that you’re able to meet at least the basic expectations of your first few customers. Starting a business unprepared isn’t a great way to win repeat consumers.
Figure Out How You’ll Get Paid
When you get your first customer, you can bet they aren’t going to be very impressed if you tell them you can only take cash or a cheque. People pay for just about everything with debit or credit cards now, and if you aren’t prepared to take this kind of payment, you’re not going to create a good impression.
By signing up for SmartTrade, you’ll be able to take credit and debit card payments directly from your mobile phone without paying for expensive contracts or a card reader that you can lose or break. It’s an Android or iPhone card reader with no physical card reader. In other words, a no-brainer. There are no startup fees, so you can start taking payments right away. And you don’t even need an expensive business bank account!
Starting and running a small business can be an expensive proposition. Tools and supplies, rent for a storefront, a vehicle, tax, insurance, marketing and advertising materials, legal help… the list goes on and on. But you don’t have to front all of the costs yourself: there are plenty of business financing options to help your business get up and running and stay that way.
Secure Funding For Your Business
There’s one huge advantage to getting a business funding grant that makes it much more appealing than getting a loan: you don’t have to pay it back. While there might be conditions on the grant, the money is yours. And not paying back principal or interest can be a huge boost for your company, whether you’re just starting up or you’re looking to expand.
Government grants are often meant for a specific purpose: there are a number of grants to help you get your business up and running, there are some to help you expand into international markets, others to promote R+D, a number to support business collaborations, and some for hiring and training new employees.
Others target businesses with specific objectives, such as sustaining the environment, supporting social justice, distributing humanitarian aid, and others. Your intention for using the grant money may affect which grants you’re eligible for, so it’s important to have a good idea of what you plan on doing with the grant if you get it.
Figuring out whether or not you’re eligible for a government grant can be tricky—there’s a large number of schemes, each with their own eligibility criteria. Some are location-based, some are size-based, and others are available only to businesses in a certain sector.
Fortunately, there’s an ace finance and support finder available that will help you figure out whether or not you qualify for any UK business funding grants (and other business financing options). Just enter the relevant information about your business—type of financing you want (grant, in this case), where you’re based, what area of business you’re in, how many employees you have—and you’ll be presented with a list of grants that you may be eligible for, as well as useful information on that particular scheme.
The European Union also offers a number of business grants that you might be eligible for. The best way to see if there are any grants that might suit your business is to look at the list of grant areas that are covered by EU business grants and select your area—you’ll then see a list of calls for grant proposals. If any of the calls look interesting to you, you can dig deeper to get more information and apply.
Finally, a number of trusts and organisations also provide grants to fund businesses—these are more difficult to find, however, and might be best suited to businesses that fill a specific niche. To get an idea of where you could start looking, let’s look at sustainability grants. For example, the Community and Renewable Energy Scheme (CARES) offers financing to businesses that are looking to run sustainably. The Technology Strategy Board, the Energy Technologies Institute, and the Foresight Group all offer support to businesses looking to become (or remain) eco-friendly.
In a different vein, the Girdlers’ Company Charitable Trust support charities and community organisations. And several funding bodies exist to help employers bring on disabled or disadvantaged employees.
Tips for Securing Busines Funding Grants
Though every grant application is different, the best way to increase your chances of receiving a grant is to very closely align your business strategy and plans with the objectives listed in the grant or the the main interests of the awarding body. If an organisation, whether private or public, is funding business grants, they’re trying to accomplish something. Make sure that your application makes it very clear how you’re going to further their objective.
Second, do what you can to get noticed by the awarding body. If you can make any contacts with the board that will be reviewing applications, even just by making a phone call to ensure that they’ve received your application, you’re going to stand out. You don’t have to grovel and pander, but it’s a good idea to get your name out there so they remember you.
While grants seem like the best option for financing your business, they’re highly competitive and can be difficult to come across. Loans, on the other hand, are more plentiful and generally easier to secure. While you are required to pay back the loan, you can often find very-low-interest (and sometimes even interest-free) options, significantly reducing the financial burden on your business.
The first place you probably think of to get a business loan is from a bank; however, it’s important to know that banks can be quite difficult about business loans, especially if you have no operating history. You might face high interest rates, have to put up a lot of collateral, and have a strict repayment plan. While it might be easier to get loans from banks than from other sources, you could quickly find yourself further in debt than you expected. If you do decide to go with a bank, the Business Banking Insight website will help you out—click here to learn more about BBI.
Fortunately, there are a number of other sources of business loans. The British government offers loans to businesses, both those starting up and those that have been running for a while. Again, you can find these on the business finance support finder. Just select “loans” as the type of support you’re looking for. The EU also offers loans to businesses around Europe; you can get information on these from the “Access finance” page of the EU business portal.
Again, private organisations are a good source of funding if you’re looking for a loan. Many of them offer low- or no-interest loans.
Tips for Securing Business Financing Loans
Being highly prepared is of the utmost importance when applying for a loan. You need to have a solid business plan, concrete next steps, and a very clear objective for your business. If a bank doesn’t think that you’ve done enough thinking and planning for your business, they won’t give you a loan—and that’s that. Get in touch with someone who has experience in writing business plans or applying for business loans and get them to help you out.
One of the more difficult options for financing a business—though one of the most lucrative—is by getting investors on board early. This works best for certain types of businesses, especially those in the area of technology, but it could potentially be used for any type of business. If you have the potential to earn a lot of money, you’re a good candidate for investment.
There are a number of different types of investors: venture capitalists, angel investors, start-up accelerators, and so on. In most cases, they’ll give you the funds to kick-start your company in exchange for equity or partial ownership of the company, allowing them to earn a large return on their investment when your business becomes profitable. A 2009 studyestimated that there are between 4,000 and 6,000 angel investors in the UK and that their average investment was £42,000, a good chunk of change to get your business moving.
Of course, finding these opportunities and competing with other small businesses isn’t easy. Even after you find a potential investor, you have to convince them that you have a winning idea, a winning team to support it, and a great business plan. Not sure how to convince a potential investor? Check out this article on the five Ms of a successful investment.
Going about finding an investor depends heavily on your sector, so it’s a good idea to spend a couple hours searching online for potential ways to connect with investors. You can also get started with the UK Angel Investment Network.
Tips for Securing Investors
One of the best things you can do to bring investors on board is to have a compelling story to back up your idea. You’re likely to be presenting your ideas in a face-to-face meeting, and if you don’t catch the investor’s attention and convince them that your idea is worth funding within the first few minutes, you’re going to face an uphill battle.
Practice your storytelling skills by crafting a compelling story and pitching it to your friends and family. Get feedback on your content, delivery, body language, and anything else that might help or hinder you in your pitch. Make sure you know the story you’re going to tell and how you’re going to tell it when you go into the meeting!
Get Out There!
Securing funding for your business isn’t always going to be easy, but it can be done. Thousands of other entrepreneurs have done it, and most are willing to share their experience. Take advantage of your connections, start searching online, and get a plan in place. You’ll find the funds you need to get off the ground!
How did you finance your business? Did you find one of these sources of funding to be successful? Share any thoughts and tips below!
So sign up for SmartTrade today, start writing your business plan, get registered, and get to doing what you really want to do: running your business.