Once the formalities of creating a new company are done, how do you start building a business which is going to survive the first five challenging years?
Creating a new company can be completed within a few weeks, and for just a few hundred dollars. However, certificates of incorporation and articles of association are merely the administrative formalities required to launch a new business. The hard part – as any existing business owner will tell you – is ensuring the company doesn’t fail within its first five years. Sadly, most new businesses do, which is why it’s vital to set objectives and have a realistic outlook.
How to Remain Flexible and Realistic in a Congested World
This latter attribute – namely keeping realistic – is perhaps the most difficult to achieve, since every entrepreneur’s brain fizzes with long-term expansion plans. Accept that your company is probably entering a congested marketplace with rival firms in the maturity stage of their life cycles, and project modest levels of growth in early years. New businesses rarely develop as anticipated – there’s always an unexpectedly profitable sideline, or a key offering that proves surprisingly unpopular. For this reason, don’t choose a company name that’s too specific, and try to avoid bad puns in favor of emphasizing your location and/or chosen industry.
A business plan containing competitor analysis and financial projections is advisable, and potential investors will expect it, but it’s not essential if your new enterprise is based around personal services. Companies trading in goods will require far more regimented plans detailing issues such as inventories and contingency funds, while premises and transport may become significant capital outlays requiring repayment. Conversely, service providers like freelance creatives often work in their spare rooms or garages, charging home office usage to the company account and claiming everything from laptops to pens as business expenses.
Be a Reputable Business and Get Your Financial Affairs in Tip Top Condition
The reference to expenses in the previous paragraph leads on to another vital strand of launching a new business – managing its finances. Few banks offer free accounts for business customers, but those that do will provide debit or credit cards linked to the corporate account. And with an account, you inevitably need an accountant. Appoint a reputable firm to handle your financial affairs, since HMRC and Companies House expect accurate financial reports to be filed on an annual basis. It’s a good idea to set up a spreadsheet of income and expenditure, logging every business journey (chargeable at 45 pence per mile if using personal transportation) and noting every standing order and paid invoice. This spreadsheet will enable you to quickly identify overdue payments; many companies have failed due to inefficient or slovenly accounting.
You’ve Set Up The Pillars. How Do You Get Your Business Seen by the World?
Having registered the company and given it a solid financial footing (possibly with a director’s loan to support initial outlays), the next step involves making the world aware of its existence. A website is essential nowadays, and platforms like WordPress enable you to create effective sites with a wide variety of functionalities from ecommerce through to stock databases. Resell.biz is ideally placed to handle technical aspects like content management and domain name registration, as well as hosting associated email accounts. For marketing purposes, it’s helpful to pick a company/brand name where the .co.uk or .com web domain is still available, but try to specify short addresses for simplicity.
Time to Advertise!
With a live website and email accounts to hand, it’s time to find clients. This depends hugely on the industry in question, but universal steps include advertising on search engines and high-profile media sites. Many industries have directories and job boards where freelancers or businesses can advertise their services and be paired with customers seeking project work, while social media accounts can generate helpful free publicity. Don’t overlook classic techniques like attending industry events and handing out business cards, either. When it comes to launching a new business, there’s no such thing as too much exposure.