Top tips for setting up a successful business

With the government announcing its latest ‘enterprise zones’ including Cornwall, Cheshire and Essex, unbiased.co.uk, the professional advice website, has put together some top tips with the help of its expert panel of professional advisers to help people set up successful businesses.  

 1.      Karen Barrett, Chief Executive at unbiased.co.uk

 “Seeking guidance can be the foundation to setting up a successful business and it’s important for start-ups to realise the worth of a professional adviser such as an accountant, independent financial adviser or solicitor.  Not only can they offer you valuable advice but also save you money in the long term, particularly when it comes to tax benefits and funding, while freeing up your time to focus on other important business matters.  Go to www.unbiased.co.uk to conduct a free and confidential search to find a professional adviser.”

2.      Mel Kenny – Business planning

“Make sure you draw up a robust business plan in which you are honest with yourself on the assumptions that you make and build in enough flexibility for the months when money doesn't come in so that you’re still able to survive.  Only then will a bank be interested in you.  Bank managers already have enough bad debt on their books but if you are honest with your assumptions, it will save you going back to the bank for a bigger than agreed overdraft which can send out the wrong signals.”

3.      Anna Sofat, Addidi Wealth – Finance 

“Be clear how much you need and what you are prepared to give up for this (in way of equity or guarantees) as this will influence where you might be able to raise the capital. As a rough rule of thumb, bank funding via an overdraft or short term loan is better for short term cashflow needs and equity or more structured debt is better for financing longer term growth.”

4.      Ashley Clark, Need An Adviser.com - Funding

“Talk to Business Link about any matched funding you might be able to secure for the start up or development of your business and also any grants that may be available from either the UK, the EU or local enterprise development funding.

“Also, take initial advice from a professional adviser about using capital from pension funds for small loans, equity capital purchase or indeed for commercial property purchase.”

5.      Andrew Reeves, The Investment Coach Limited – Effective bookkeeping

“I recommend getting the bookkeeping process right from the off. This means either committing to doing the job yourself, with a full-time or part-time bookkeeper or with a remote service.  The latter means that all income and expenditure is logged into a shared server where you and your bookkeeper can both look at the figures.  It can become very difficult to "catch up" on this process and therefore should be considered from day one.”

6.      Danny Cox, Hargreaves Lansdown - Reduce your tax bill

“Take advice on how to minimise business and personal taxes.  This should include advice on whether to set up as a sole trader, partnership or as a company, what expenses can be offset against profits and the most tax efficient way to pay yourself.  Advice at the outset could save thousands of pounds in unnecessary tax.”

7.      Jo Nockels, TaxAssist Accountants - VAT registration

“Contrary to popular belief, unless there are particular circumstances, businesses aren’t generally obliged to register for VAT until their turnover has reached the registration threshold (currently £73,000).  But if you’re planning large capital spends or are going to be trading predominantly with VAT-registered businesses, then it may be in your favour to register for VAT voluntarily.  You would be advised to seek professional advice from an accountant when considering whether to register for VAT though.”

8.      Alan Woods, Woods Squared Limited - Clear vision and objectives

“What will your business look like when it is finished?  If you don’t have clarity around this when you start your business how will you know when you get there?  Identify your business aims and objectives – what you want to achieve.  These should be quantifiable and should be split between short term (i.e. next 12 months) and long term (i.e. next 3 years).  This will allow you to track progress against your projected targets but don’t forget to continually update your business plan - this is crucial!”

9.      Leigh Martin, Clarion Solicitors – Intellectual Property (IP) Rights  

“Ensure that the IP rights are owned.  This is vital, and an area in which mistakes are often made.  As a general rule of thumb, if a non-employee is creating something in which there will be IP, to be used by the business, ensure that a written assignment is put in place preferably before the IP is created.

“Keep confidential anything that the business may wish to protect through a patent application or a registered design application.  Ensure suitable confidentiality agreements are put in place with potential customers, manufacturers and R&D Partners who inventions or designs are being shown to.”

10.  Kusal Ariyawansa, Appleton Gerrard – Does it fit with your business plan? 

“Research the enterprise zone you’re thinking of moving into and work out whether the location fits with your business and business needs (e.g. an international freight forwarding business would be better placed near an airport). While the initiatives and benefits can be a huge advantage these should not be used solely to make commercial decisions.”  

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