Has it dawned on you that you’d really rather not be working for someone else for the rest of your life? You’re not alone. Research published by OnePoll and FreeAgent last year revealed that 67% of 18-24-year-olds are interested in starting their own business. So, what’s holding you back? If you’re a young, ambitious and aspiring entrepreneur who isn’t sure how or when to take the next steps, this post for you.
Find your space
You’ve got an idea. You think it could work but you’re worried you might not have enough experience or contacts to pull it off. There’s no denying starting your own business is hard work, but whether you’re planning to manufacture your own product or want to rely on the talent and skills you’ve been using in your day job to run a business of your own, confidence in your own credentials is key. If you’re good at what you do it will shine through. However, raw talent and hard work won’t automatically guarantee success, so you’ll also need to do the groundwork. Planning and research are key and you may find it helpful when running through this stage to work with a business mentor. Not only will they be able to coach you into considering questions you’re not yet aware of, you could also find they help you unlock your inner confidence too.
If you already have a business model in mind, you’ll need to do proper market research to explore whether the idea has legs. If your plan requires investment, this research will be fundamental when it comes to scoping out your business plan to prove to the bank you’ve found a space in the market. This could be a geographical space where you seek out a good spot for a store or premises with footfall, your own product or service niche, or a mix. A few words of caution though – remember that customers don’t always know what they want. Henry Ford is often quoted as having said: “If I asked people what they wanted they would have said faster horses.”
Plan your finances
If you’re a skilled professional working in any field from accountancy through to hairdressing, you may be hoping to cut out the middleman and start making money from your own training and talent. If your employment contract allows it, building your freelance base alongside your day job is one of the most popular and least risky ways to make the transition into a small business owner. However, you may still find that you require some capital to get your business started.
Premises, marketing and employees are all potential startup expenses you are likely to have to cover up front. How will you fund these? If you’re hoping for a loan, most banks will want to see some form of financial commitment from yourself before they stump up the rest of the cash towards your business vision. After all, if there’s only their money to lose, it’s a lot easier for you to walk away. You could also go to an alternative lender and apply for a short term business loan. Chances are you may need to save up some of your own cash or ask for investment from friends or relatives. You may also be able to seek grant funding, so take a peek at the latest Government services and information for help in your area.
Poor cashflow is one of the biggest killers of young businesses, so you’ll need to plan beyond the startup phase to be successful. What kind of financing methods will you have up your sleeve? Business loans, invoice discounting, crowdfunding and angel investment are just some of the ways you might seek capital to help your business grow.
Beat the red tape
The truth is, starting any kind of business requires cutting through a little red tape. Even sole traders need to register with HMRC and depending on the nature of their business, they may also require certain insurances such as professional indemnity insurance too. Will you be holding customer information? Well, you best get clued up on data protection. To start a food business you’ll need to be hygiene certified and registered with your local council. Whatever field you’re in, if you are planning on employing staff you’ll need an overview of payroll, pensions and holiday entitlement. Failing to deal with some legislation types before you launch won’t just be an inconvenience, it could close you down before you even get started, so take the time to explore your obligations first. It’s wise to consult a solicitor about matters such as employment law and rental contracts for premises. Similarly, governing bodies and professional member organisations are a good place to start exploring regulations related to your chosen field of business.
Remember, while preparation is crucial, on paper there’s not usually a ‘right’ time to start a business and to a certain extent, a leap of faith is a must.