New Business Guide

New Business Guide

It’s never a bad time for a new idea

//Content

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Introduction // I’ve always believed there’s never a bad time to come up with a good idea.

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Top Tips

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Funding, Grants and reliefs

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Spotlight on ... Cloud technology

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Case Study // Mobile Mechanic

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Case Study // Bar and restaurant

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Next steps and useful links

Learn to say no to anything which doesn’t get you closer to your business or personal goals

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“Just because someone is willing to pay you, doesn’t mean you should take them on as a client.”

I’ve always believed there’s never a bad time to come up with a good idea.

Having workedwith start-up companies for over 20 years throughout my career, I’ve seen, first-hand, just how essential they are to the development of innovation, technology and new ways of working. Now, more than ever, I’m seeing new companies in a range of industries challenging the status quo and serving customers in a way that works today, not simply following what has worked before. We know that recent global events have reshaped how businesses are run. Changing customer demands, whether as a result of social responsibility, to support local firms, or as a move to online services, are having a real impact on which companies will thrive in the future. I feel this gives a window of opportunity and advantage for new enterprises, if they can offer a compelling story to people wanting to do business differently. Taking the first step to start your own company is not always easy but with the right research and support, your business idea can really flourish. Whether you have a product, service or a combination of the two, I believe there’s a great chance for you to succeed with effective preparation and guidance along the way. To achieve this, my advice is to find the support which is truly right for you and your specific business. There are many different business services and advice paths but the trick is to find those which not only understand your industry, but also, those which will work, day in, day out, helping new companies get off the ground. There will, of course, be obstacles to overcome and new skills and obligations to learn along the way. I believe that by taking time at the start of your journey to understand the commitments and requirements you face, you can save a great deal of time, money and energy in the long run, leaving you to get on with growing your business. In this guide, we’ll take you through what we believe are some fundamental things you will need to consider when getting started. We’ll also take a more in-depth look at maximising the benefits of technology, as well as the funding and financial support available to you. Finally, we’ll explain how we can help, and where you can find further support from elsewhere.

Stuart Sheldrick // Director

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“Hack // Stick to what you are good at and only you can do, delegate or outsource everything else.”

//Top tips

There’s so much to do when you start your own business. Whether you’re creating a new product or offering a new service, you want your focus to be solely on making your idea succeed.

There are, however, a number of decisions and responsibilities that need to be addressed when creating your company. So, to avoid these issues getting in the way of your creative dream, we’ve put together some tips on how to tick the necessary boxes and prevent any problems arising while you’re focusing on your new strategy.

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Choose your set-up

How to set up your company is often the first important decision tomake. There are different tax structures to consider and your adviser can help you decide which route to take when you discuss your business plan with them. If you intend to start working on your own, and you value the speed and ease of your business reporting, then becoming a sole trader could be your best option. However, if you want to employ others, copyright your products, or take advantage of a greater range of financial aids, then a limited company might give you the flexibility you need to grow. If you feel you fall somewhere in between, there are other structures which may suit you even more.

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Protect your business

Whether it’s professional indemnity and public liability, or life insurance and key person cover, there is a range of protections available for companies, their owners and staff. Make sure you understand which are compulsory for your type of business and which you may need for extra security and peace of mind if the worst should happen to yourself or your team.

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Get your advisers in place

We know you’re keen to get started! You want to get straight out to meet new clients and win that first piece of business. It’s important, however, to make sure you have your business advisers on hand from the word go, so they can ensure you start heading in the right direction, provide the support you need and help you avoid the tricky job of playing ‘catch up’ with paperwork and finances later on.

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Understand your finances

Before you start to spend, or bring in, money, make sure you understand exactly where you stand. Firstly, decide where you want to bank. Themost common options are either the convenience of high street chains or the potential lower fees of online challenger banks, although this is not always the case. Separate your personal and business finances from the start too, to avoid confusion and difficulty identifying funds later on. You should also look into, or get some advice with, what kind of expenses you can and can’t claim for before you start spending your money on building your new empire.

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“Plan your week in advance on the weekend, this way you hit the ground running come Monday first thing!”

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Technology is king

There has never been a better time to make use of technology for your new business. From real-time, cloud accounting, time and inventory systems, to digital marketing and online sales, making the most of technology from day one saves a great deal of time and effort as well as also ensuring your company is equipped for a modern-day customer.

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Plan ahead for the second phase

Many new small businesses start strongly, with real enthusiasm for their venture and income from existing connections. It’s crucial though to have a plan for the next stage when the launch period is over. Identify, in advance, your next target audiences, where you can market yourself next, and whether you will expand to offer any additional services. Don’t let your confidence, or motivation, fall away once you’ve got started: it’s only the beginning!

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Be pro-active with your cashflow

Managing money is one of the hardest things when you start a new company but it’s important to be efficient with how you handle your funds. Invoice promptly so the money is in your account, not your client’s, for longer. Stay on top of your day-to-day accounts too. Many businesses fall into the trap of either taking too much money out of the company, and facing a struggle to pay a later tax bill, or being overly conservative and leaving surplus money in the business, sitting there, doing nothing. Having a handle on what money you do, and don’t, need at any one time is a great skill to learn and one your advisers can help with.

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“What do you wish you’d known when you first set up your business? More about tax and how to manage it more efficiently”

Funding, grants and reliefs

Not every business can be started from a laptop on a kitchen table. Many need a financial commitment from the beginning for products, materials, staff and premises among other things. No matter what kind of business you are starting up however, there is a range of ways through which you can find some support with either your initial outlay, or your ongoing, financial situation.

In this section, we’ll look at options you can explore which may be suitable for you, whether for initial capital borrowing, reducing your tax liabilities or bringing outside investment into your business.

Business loans and grants

The most common support you might need is for initial costs and money required to buy the essential elements you will need to get the business set up and off the ground. One possibility may be a loan from the bank where you hold your personal or business accounts but there are other options available too. You should investigate whether you would be better served by applying for a government-backed, Start Up Loan, run through the British Business Bank, which also comes with free business planning and mentoring support. Also, if you intend for your business to support local regeneration or employment, there are grants for apprenticeships, Smart Grants, community funding and enterprise allowances out there too.

Tax reliefs and R&D

When you start your new business and are looking to stabilise your finances after initial spending, the first tax bill can seem a daunting prospect. There are, however, a number of ways in which you canmitigate this through a range of tax reliefs and allowances. If you are self-employed, speak with your adviser about the expenses you are able to claim for ongoing costs and items you have bought for the business that will reduce your tax liability on your Self-Assessment return. Your business may also be eligible for other tax relief in the form of capital and annual investment allowances for the equipment and premises you require in order to run the business, as well as anything provided to employees to use from home.

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“There’s no shortage of remarkable ideas, what’s missing is the will to execute them”

One other key area which is often overlooked is tax relief for research and development (R&D). A range of businesses can claim this relief against their corporation tax bill for the relevant qualifying costs if they are either developing new technology, or are working alongside other firms who are doing so. Make sure you get some advice if you think you might be eligible for this.

Bringing in investment

If you are wanting to scale up your operations and expand your growing business once it’s off the ground, then outside investment could be a beneficial way of securing the funding you need.

The Seed Enterprise Investment Scheme (SEIS) offers tax relief to those willing to invest in small and growing companies like yours. You are required to have SEIS status in order for your business to benefit from this financing route. Your advisers can help you apply for this. Youwill need to drawup relevant business plans and forecasts, as well as a proposal for investors. You could, instead, pursue an opportunity with an angel investor, who may have useful experience and contacts that can help grow your business further, or more quickly. There are networks of these entrepreneurs you can be connected with, although you will need to be willing to give up part ownership of your company in many cases. This is something you will need advice on before committing to anything.

In summary

Spend some time with your adviser to discuss the particular financial support which is available to your specific type of company. Start by understanding the start-up and running cost expenses and allowances you can claim that will mitigate your tax bill. If you do need specific lump sum funding on a bigger scale, get the right advice for the best support for your needs which doesn’t leave you either giving up control of your brand new company, or saddles you with regular payment commitments that can impact your financial position and limit your flexibility as you start out.

Research and guidance are key from day one. There’s help out there for you so you don’t need to struggle or put yourself into debt to set up your business. Getting the right help, not just any help, is vital.

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“If you look closely, most overnight successes took a long time”

Spotlight on… cloud technology

As you prepare to take your first steps towards putting your business idea into practice and setting up your new company, committing to new technology may not be the first thing on your mind. I would suggest it should be very high on your list however. The fact is, it’s almost always easier to introduce technology when your business is smaller. Introducing systems which can then grow with you as your business expands, removes the initial administration demands on your time, setting you up for efficient management of the business finances right from the off. A good adviser should always discuss digital first principles with you early on and work to identify your current processes and how they can adapt to the technology available. Taking this approach also means that you can make appropriate decisions on hiring and reporting processes as your company develops. Recruiting roles to work alongside your existing technology at a later stage is far easier than replacing your people with systems further down the line. The key is to look at value, rather than cost alone. I’ve seen many new businesses concerned about incurring costs, but then spend hours of their potential working time on lengthy, manual processes and >Page 1 Page 2 Page 3 Page 4 Page 5 Page 6 Page 7 Page 8 Page 9 Page 10 Page 11 Page 12 Page 13 Page 14 Page 15 Page 16 Page 17 Page 18 Page 19 Page 20 Page 21 Page 22

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