You’ve made the decision to start your own business and you want to get going on building your idea into reality. Remembering everything you need to do to start up and form your company can be daunting, so we’ve put together a checklist of 25 things you’ll need to do, from before you start your company right through to your regular routine.
Things to do before you form a company
There is much to research before starting a business. From the viability of your business idea, you’ll need to also work out who your target audience is – in terms of geography and demographics, and who your competitors are. Having an in-depth knowledge of both of these is crucial. Once you know who your target audience is, carrying out some testing with them to ensure you’ve got it right and also that there’s a market need for your product or service is also vital.
2. Think of a name
Your business name may come to you in a flash, or it may be a longer project to come up with one that’s truly suitable – if you’re facing the latter, check out our article on choosing a solid company name for inspiration. Your company name is a big part of how your business will be received, and can mean the difference between failure and success, so it does need careful consideration. Remember too that your business name will need to be unique – it will be protected once you’ve registered with Companies House, and it can be well worth checking out whether the competition have already snapped up your name of choice before you get too far down the road.
3. Register a domain name
Securing a domain name, or URL, to go with your business name should be a part of your overall naming strategy. To work well for you, your domain name should relate easily to your business name and should be memorable too. Registering a domain name can be relatively inexpensive and it’s worth making sure you choose several second-level domains, ie .co.uk and .com – there are many options available now.
4. Write a business plan
Your business plan will help you to get everything straight in your own mind as well as giving you a document to take to the bank later down the line. As well as explaining your business intentions, your business plan should include market, customer and competitor analysis, information about your product or service, and organisational structure and financial information. Find out how to construct your business plan here.
5. Figure out finance
While for some businesses, personal finance can be used to start up, many entrepreneurs need to gain investment from third parties in order to get off the ground. You’ll need to be very realistic about the amount you’ll need too – taking into account how much you need to live from while you’re setting up, as well as the amount you’ll need for your premises, fixtures and fittings, employees and other overheads. Remember to make sure you include enough time in your calculations, as often businesses don’t make a profit for a time.
6. Choose your directors
You may be starting out alone, but if you wish to share your business load with another person, or maybe more than one, you’ll need to choose your company directors and work out their responsibilities, as you’ll need to include this information when registering with Companies House.
Running your own business means you need to be Jack of all trades. But you also need to be a master of them all…at least in the beginning. From great leadership and sales skills, through to organising and communicating, finance and IT – you’ll need to be able to manage each of these areas and more. Figuring out which you’re good at now, and getting some training to make sure you can master the rest is a good idea before you get started.
8. Decide on your business structure
Before you get started you’ll need to know what sort of business you’d like to own. You could be a sole trader, you could go into partnership with a friend or associate, or you could set up a limited company. Each has their merits, but remember to think about your businesses future growth – it may well be worth setting up a limited company from day one to ensure you have the structures and support in place to grow when you need to.
9. Register with Companies House
Registering as a limited company with Companies House is one of the easy bits of the puzzle, especially when you choose a formations agent to do it for you. With The Formations Company you can register your business for as little as £4.75, and the whole process can take as few as three hours to complete.
What to do after you’ve formed your company
1. Open a business bank account
Separating out your business banking and personal finances means you can easily work out your figures for end of year returns. A business bank account is also a requirement if you’ve set up as a limited company. Business bank accounts vary and you’ll need to keep an eye out for the one with the best benefits for you. Bear in mind the charges that may apply, what facilities the bank offers, such as internet banking and overdrafts, and have a look at the other perks on offer. For instance, when you open a Barclays Business Bank Account when registering your company with The Formations Company, you’ll also get £50 cash back into your account.
2. Create a brand identity
As well as your business name, you’ll need a look and feel for your company. Your company brand goes much further than your logo, typeface and colour palate though. Think about the vision and values you wish to portray. Live by them and share them with your customers and stakeholders.
3. Build a website
While a website may not be critical to launching a company, as the world moves more and more online, so we also look for credentials and reliability by checking out companies by their internet presence. If you’re not planning to trade online, and you don’t have the budget to create a full website, consider building a holding page with key information and contact details, while your business grows to the point where a bigger site is required.
4. Write a marketing plan
You may have a great product or service, but unless people know about it, then business will be slow. When you come up with a marketing strategy, the goal should be to grow your business and to build awareness of your brand, all helping to generate new business. Your marketing strategy should include your objectives, messages and target audience, as well as the media you’ll use, your budget and timeframes.
5. Pitch to investors
There are many types of investors and you first need to work out whether you wish to raise your start up capital through debt or equity. Once this has been decided, you can make your pitch to your prospective investors, telling them how much you’ll need, and selling in the benefits of helping to get your business started. Investing your own time into getting this right, knowing your pitch inside out and being ready for questions is imperative.
6. Find your premises
Starting up in commercial premises will give you the room for your business to grow, but you may also find that to start with, you need only work from a room in your home. Whichever route you choose, be sure to check the licences and insurance you need for working from that location, and bear in mind your business’ proximity to your target audience and to other facilities and transport.
When choosing commercial premises, bear in mind how much it costs and what you get for that price, whether it comes furnished and with utilities included, the scope you have for alterations and changing things around, and how long you’ll be tied in for.
7. Buy insurance
Your business insurance is critical and it’s a good idea to get professional advice from a broker or risk manager. As well as property and contents insurance, business interruption and theft, if you have employees you’ll need to take out Employer’s Liability insurance, and you’ll also need to consider other liability insurances such as Products Liability and Professional Liability, depending on your sector.
8. Buy your fixtures and fittings
Your business premises may already come with some fixtures and fittings, but you’ll also need to consider signage, specific equipment and tools you may need for your business, and of course, your administration (telephone and IT) requirements too.
9. Hire your employees
Deciding to hire an employee as a new business owner is a big step, but if you’ve found that you need someone with specific skills to take on a role, then it’s a step you’ll need to take. Before taking on your employee, consider the financial implications involved – as well as their salary you’ll need to pay PAYE and National Insurance contributions, and possibly pension and other contributions, and your overheads will also go up.
10. Get into a regular routine
While many of these things are one-off tasks, there are others that will need regular attention:
- Build upon your business plan
- Test your marketing
- Refine your targeting
- Carry on your research
- Complete your HMRC returns
- Remember your Companies House returns
- Review and renew your insurance
Make sure your new business is poised for success
Get your eyes on the prize from the minute you register your business as a limited company, because this is just the beginning. There will be plenty of scope to grow once you’ve found your feet, but making sure you’ve checked the basics off your to-do list is crucial to ensuring you have a safe, compliant and successful company on your hands. Ready to take the plunge? Go check out our company formation packages to get the process started. Or, if you’ve still got some more research to do, there is more information on all kinds of topics in the Help Centre.
Published Wednesday January 23, 2013