Launching a business takes more than dreaming up an idea and picking a name for your new venture. Careful planning and research, along with taking care of business essentials can go a long way to boosting the chance of a successful launch.
When launching a new business, it’s worth spending some time putting together a business launch checklist. This involves listing all the activities that you must do in order to get your business up-and-running.
1. Get the right business idea
If you don’t already have a brilliant business idea but want to set up your own business, you’ll need to brainstorm a suitable business proposition. Think about your skills and experience, what you’re good at and what you’re passionate about. Your business will rely on customers, so think about their needs, desires and the problems they face so you can brainstorm ways to solve them.
2. Research your business idea
Spend time researching your idea. Make sure you research the target market, finding out what potential customers need, how they buy and how much they are likely to pay. You can use surveys, research reports and statistics online and directly ask customers using focus groups. Look at existing businesses offering a similar service or product – how do they market their business and acquire customers?
3. Create a business plan
Consider drawing up a business plan, though this is a must if you’re looking to raise money for your business and plan to approach investors, banks and other lenders. Identify business costs – from materials and capital expenses to staff salaries and other overheads – as well as projected sales and profit margin. Create several versions reflecting worst-case, expected and best-case trading conditions so you can see how poor trading would affect cash flow.
4. Choose a business name
You’ll need a business name that matches your brand, but it must be unique or you’ll run into legal issues. Companies must follow the Business Names Act 1985 and Limited Company names must be registered at Companies House and comply with the Companies House Act of 1985. Test out names with potential customers and check with the Companies House register to see if your proposed business name is already taken.
5. Choose the right business structure
Choose the most suitable business structure for your venture. The most popular structures are:
- Sole trader – self-employed with personal liability for all business debts. You must register with HMRC and pay Income Tax and National Insurance on your earnings at the end of every tax year through Self Assessment.
- Limited company – this can be owned and operated by one or more people and must be registered with Companies House. A limited company exists as a legal entity, so owners are not personally liable for business debts other than what they agree to contribute to the business.
- Limited Liability Partnership – suited to professionals who run a partnership with other people. You’ll need at least two people to set up an LLP and it is similar to a normal partnership in terms of ownership structure and taxation, but it provides limited liability to all partners.
6. Register with Companies House
You can register your business directly with Companies House for £12. This includes activities such as choosing directors, identifying people with significant control over your business, and allocating shares. Alternatively, there are lots of company registration services available that can help you and cost around £100.
7. Register a domain name
Almost all companies need a website that is identifiable as your business and easy for customers to find online. It’s worth checking to see if a website address – known as a domain name – is available. Domain names cost a few pounds and need renewing annually.
8. Register for taxes
You’ll need to register with HMRC for Corporation Tax or Self Assessment, depending on your business structure. If you’re employing staff, you must register for PAYE with HMRC. As soon as your business starts earning more than £85,000, you must register for VAT.
9. Apply for business licenses
Depending on the nature of your startup, you may need licences and/or permits in order to trade. Gov.uk has a handy licence finder tool you can use to find out what you need to apply for.
10. Create a company logo
Create a memorable logo that represents your business. A cost-effect route is to use online logo creation services or buy a ready-made logo from an online stock library. Alternatively, you can pay a designer to create one for you, which can cost between £200 and £5,000.
11. Open a business bank account
You’ll need a bank account to deposit payments and pay suppliers and staff. Sole traders can use their personal bank account, but it makes sense to keep company and personal finances separate by opening a business account. Limited companies must legally have a dedicated bank account.
12. Arrange business insurance
You’ll need to arrange a number of different insurance policies as part of your business launch. The key insurance policies are professional liability insurance, public liability insurance and employer’s liability insurance if you employ staff. You may want to consider other insurance policies such as building and contents, commercial vehicle insurance, director’s and officer’s insurance and income protection insurance.
13. Find business premises
Many entrepreneurs run their new business from home to keep costs to a minimum, but this isn’t possible for all businesses. When looking for dedicated business premises, carefully consider its size and location, and decide whether you should lease, licence or purchase premises.
14. Find suppliers
Look for suppliers that work with similar businesses to yours, and request references or samples. Put a contract in place with the help of a solicitor and use several suppliers so your business is not dependent on just one or two.
15. Market your business
Create a marketing plan, delivering key messages using channels your target market is likely to encounter and respond to. Look at marketing across all channels, from social media to pay per click advertising or more traditional radio, TV and newspaper advertising. Measure how successful each is so you can increase the efficiency of your marketing spend over time.