How To Start A Business
Starting a business can be a thrilling and challenging experience. It’s an opportunity to turn your passions and ideas into a successful enterprise. But, the process of starting a business can also be overwhelming, especially when it comes to finances. That’s why it’s crucial to have a good understanding of basic bookkeeping and accounting principles before launching your business. As tempting as it may be to push these things till much later, we want to pre-warn you- Don’t. We’ve seen what happens when you do…
We’ve created this go-to guide on how to start a business to make the whole process easier and more managable.
Let’s take a look at some key points to consider when starting a business…
Do Research and Create a Business Plan
Research is critical when starting a business as it helps to inform and guide decision-making. Doing research will help you:
A business plan is a roadmap that outlines your goals, strategies, and projections for the future of your business. It should include details about your market, competition, target audience, and how you plan to generate revenue. Your business plan should also include a detailed financial plan, including start-up costs, cash flow projections, and sales projections. It may seem like a lot of work, but this is an asset that will serve your business in the beginning stages and throughout its future growth.
Choose the Right Business Structure
One important aspect of starting a business is choosing the right legal structure. Check out our previous article “Limited Company Or Sole Trader, Which Is Better?” for more in-depth advice.
Your business structure will determine how you file taxes, manage liability, and operate. The most common business structures are Sole Trader, Limited Company (Ltd), and Business Partnership. It’s always best practice to consult with an accountant to help you choose the right structure for your business.
If your plan is to start a business partnership, check out our article “Business Partnership Explained”.
Insurance, Licenses, and Permits
Before starting your business, you’ll need to obtain the necessary business insurance, licenses, and permits required by law for your industry. Requirements vary depending on your location and the type of business you plan to operate.
For example, if you plan to set up a photography business, you’ll likely need to have professional indemnity insurance, and if you plan on opening a food-based restaurant you’ll need relevant food safety/hygiene certificates and possibly a license to sell alcohol, etc.
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Professional Branding and Website
When starting a business, don’t overlook the importance of having professional branding and a website!
A strong brand identity differentiates you from your competitors and creates a lasting impression on your customers. Invest in your brand, define your unique value proposition, and communicate it consistently across all touchpoints.
A professional website allows you to reach a wider audience, promote your products and services, and engage with your customers 24/7. Invest in a website that represents your brand and sets you up for success!
As a start-up you may not have an enormous budget to invest in marketing, so in these cases, it’s important you plan and prioritise wisely because you won’t be able to do everything at once. Having a business plan from the beginning will help you with this. Do the research, see what can bring the best results for the industry you are in, and make a plan of what you’re going to do first, second, third, etc.
Don’t feel demotivated by looking at big brands that invest in all sorts of marketing and are on lots of different social media channels. Although it may feel tempting to be everywhere from the start if you don’t have enough time to manage everything or money to hire people to be on top of everything all the time, nothing will bring results. Be more strategic, start with one method, and then keep adding. A consultation with a marketing expert in the field may help you decide where to start.
Create a Good Bookkeeping System
Having a good bookkeeping system is essential for managing your finances and staying organised. You can use software like Xero, to track your income and expenses, create invoices, and generate financial reports. Make sure to keep all receipts and invoices for tax purposes.
Here at Joanna Bookkeeping, we aim to find the best ways to use technology to help busy business owners with their new businesses, and one of the ways we can do this is by providing cloud-based software solutions that automate bookkeeping and accounting tasks. We can help new business owners create digital invoices and track expenses in real time, making it easier to maintain a good bookkeeping system.
Also, it may seem obvious, but it’s important to keep your personal and business finances separate. This will make it easier to track expenses, manage cash flow, and prepare accurate financial reports. Open a separate business bank account and use a separate debit card for business expenses. It’s even more important when you run a limited company as it’s a separate legal entity.
Seek Professional Advice
Starting a business can be a complex process, and it’s essential to seek the advice of experts in certain fields. It can be a marketing expert, website designer, professional accountant, or someone like a business mentor with a more general knowledge of running a business. A professional accountant can help you with financial planning, tax planning, and compliance with regulations. An accountant can also provide valuable insights into how to manage your finances, increase your cash flow, and generally grow your business.
Starting a business is an exciting and rewarding experience. By following these tips, you can lay a solid foundation for your new business and ensure it’s successful.
At Joanna Bookkeeping we can help support your new business venture. If you want to avoid getting stuck in red tape and make sure everything is done correctly from day one, then let us show you how! Book a call with our accountant from Oxford to see how we can help.
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