You might find the idea of being your own boss alluring. No more working to line someone else’s pockets, and you’ll have the freedom to pursue your own goals. However, getting a fledgling firm off the ground isn’t easy.
According to research conducted by the commercial insurer RSA, more than half of new companies in the UK fail to survive beyond five years. If you’re to make a long-term success of your venture, you’ll need to get the basics right. To help you along the way, here are some of the fundamentals that all budding businesses need to have in place.
A great idea
Without a knockout idea, there’s no chance that your start-up will succeed. It doesn’t matter how diligent, organised and determined you are, if the genesis of your business isn’t right, you’re doomed to fail. Your idea must be realistic and you have to be able to turn it into a product or service that people will actually pay for. To ensure you’re heading down the right path, it’s important to conduct research from a very early stage. Speak to potential customers to find out about their needs, make and test a basic prototype if you can and get the lowdown on any possible competitors. If you discover that your idea’s not quite right or there’s no gap in the market, cut your losses and go back to the drawing board.
The right base
A suitable base from which to operate is crucial too. You’ll need a space that’s the right size and has all the equipment and furnishings you require. If you need to stock up on new seats, desks and other products, you can head to specialist suppliers such as Furniture At Work. Be sure to choose good quality supplies. After all, you’re likely to spend long hours at your workstation, so comfort will be key. Meanwhile, the premises you choose must fall within your budget. Overspending on your office could spell disaster for your firm’s finances.
Finding the right location is crucial too. Depending on the nature of your business, you might need to consider the level of passing trade, the number of local competitors, transport links, parking, delivery restrictions and planning restrictions. Local council charges and business rates must be taken into account as well.
Of course, if you’re starting out small and don’t need a specially adapted commercial space, you may decide to save money by working from home.
No fledgling enterprise stands a chance without sufficient funding. Bear in mind that when you first start out, there will most likely be a phase when you’re investing time, effort and money before you start seeing any return. During this period, you’ll need enough cash to cover your costs. Possible sources of funding include government-backed support schemes, bank loans, the sale of shares and equity funding. To stand a chance of gaining cash in these ways, you’ll need to ensure you have a solid business plan in place complete with realistic profit projections. You could also bootstrap with your savings or loan from friends and family if funding from a financial institution proves difficult.
Another prerequisite is perseverance – and plenty of it. There will be times when everything seems to be going wrong and you struggle to find solutions. All budding business people experience testing times like these. The important thing is that you’re strong and determined enough to carry on and to deal with issues as and when they arise.
Starting a new business isn’t easy, but as long as you get the basics right, you stand every chance of realising your ambitions as an entrepreneur