Reviewing your business before you sign on the dotted line
23rd August 2021
We’ve all heard the phrase “dotting the i’s and crossing the t’s” and never is this more important in business than when you have an idea and you start to draw up plans. When it comes to an idea for a new start up, I always advise clients to go through the same process. Planning for a new business is exciting, but can also be overwhelming, so making sure you have everything in place at the beginning is a great way to create a successful company.
There are so many aspects to a business that need to be considered, so here is a quick outline of things you need to think about before you make anything official.
What type of company are you establishing?
Companies come in all shapes and sizes and, depending on what you want your business to look like and how you want it to grow in the future, there are a few types to choose from. Pretty self-explanatory ones are the sole trader, where one person setting up on to work on their own, and a partnership, where two or more people work together. Next is the more complicated LLP, registered at Companies House, where some or all partners have limited liabilities. Finally, the limited company is also registered at Companies House, where they have shareholders or guarantors and partners are legally separate from the company.
Another aspect to think about is what your company will literally look like. By this I mean, is it a bricks-and-mortar business with a shop, warehouse or other building? Or will it be an online business, where you work from home or office?
Creating a business plan
Getting everything down on paper is a good idea, so you have a clear view of how your business will likely shape up and having a business plan is a wise move in this direction. What does a business plan look like? Well, there is differing advice as to how you write your plan out and there are many free templates you can download to help you draw up an outline.
The fundamentals to include are your personal and business details; an executive summary, including its aims and finances; and what service or product (or both) you are going to sell. You’ll also need to have a good idea of the market you are going into as well as key findings from market research and analysis of competitors. Lastly, don’t forget to include relevant insurance and any production details and your cost and pricing strategy in your financial forecasts.
I know, it sounds long-winded and time consuming, but written with as much detail as possible, it will not only help your financial backers, it will also be a constant reminder to you of your vision and back-up plan if necessary.
Don’t despair! I’ve written in more detail about how you can start and build a business in my new book “The New Business Kit”. DOWNLOAD IT TODAY to help you get your business off to a flying start.