Several new Start-up owners have flourished in the UK over the past decade. According to a source, the private sector consists of more than six million businesses. These have risen by 2.4 million since the year 2000 in the UK.
As per the Office for National Statistics, the total number of self-employed workers in construction sum up to 920,000. There are also 643,000 under technical/scientific activities, 396,000 in repairs or sales of vehicles.
Additionally, there are 361,000 in support and administration services, and 349,000 in social work and health. Besides this, thirty-three per cent of the workers includes women. However, becoming a business owner in the UK involves a few steps.
The most crucial step to becoming a successful business owner in the UK with low investment is market research. It should include the type of products or services the company would offer, marketable price, rival offerings, commonly faced issues, target audience, etc.
Owners must also find the most suitable loans, grants, competition funding, and other financial options. Besides this, thorough research of the most convenient place of commencing business required employees, and expenditures need to get calculated.
Many solutions would also arise while researching competitive brands and distinguishing your brand’s uniqueness from others. Companies with partners or co-founders can receive constructive criticism from the board of directors, friends, family members, and partners.
Optionally, outsourcing market research would clarify doubts and help to attain the required knowledge of an industry. Besides this, it will save time and money lost due to excessive researching during the business hours.
Also, outsourcing market research would provide an upper hand against competitors and include thorough analysis from experts. However, conducting personal research to highlight similarities would prove much more useful at such an early stage.
The first step of brand creation involves choosing a name for the organisation. Owners must research the enterprise’s right name because all clients, customers, and employees will reach out to the company stating its name.
Most self-employed entrepreneurs choose a name that is either abstract, certifies a place, or resembles the owner’s identity. Entrepreneurs select an abstract title to stand out in the market, showcase modernness, or appeal as bold and challenging as their rivals.
Similarly, naming a company after a place signifies quality, memory, local pride, and authenticity. Likewise, an organisation called after the owner provides personalisation. For example, Dale Carnegie and Associates, Inc., is a company named after the famous author and trainer.
Besides this, the brand name would become an identity on all social profiles. The company website would also have the organisation’s brand name so that the customers, clients, and employees can reach out.
Brand creation would also require thorough research for domain registration. It would also eliminate names that generate inappropriate results on search engines. Simultaneously, it will impact the audience.
The next step of brand creation would involve networking events, website creation, and building social media profiles. It will even include designing business cards and logo, hosting exhibitions and registering with local business directories.
After successfully creating a brand, it is essential to protect intellectual property, including copyrights, patents, and trademarks. Regulating these aspects helps to avoid brand product or service replication in the market.
Copyright safeguards company-generated artistic work from replication. Similarly, patents help to avoid selling a brand’s product or service without legal permission. Company patents last for twenty years if the inventions are unique and fresh.
Similarly, brand names, logos, symbols, and slogans fall under trademarks. Owners can receive Community Trade Mark that lasts across Europe and for twenty-five years post-registration. Self-employed owners can sue others for infringement.
Owners with low investments should calculate the profits after reducing costs. The latter would include stationary, stocks, vehicles, income tax, national insurance, legal advice, marketing material, premises, licenses, etc.
Owners must estimate profits by developing a pricing strategy. For example, one model involves summing up variable and fixed costs and reducing them from the required profits. The justification of the additional costs could involve many factors.
Some of these factors include seasonal needs, strengths, low competition, convenience, higher product quality, etc. After creating a product or service price strategy estimate a three to five-year profit after reducing the average costs.
Such a practice would help understand the annual sale requirement and achieve them by further dividing them into monthly and quarterly targets. Therefore, the profits would become easily achievable, and the business would generate profits due to a well-developed pricing model.
Before proceeding with business registration owners must decide the structure. UK businesses fall under sole traders, general partnerships, limited partnerships, Limited Liability Partnership (LLP), Private Limited Company (Ltd), and Public Limited Company (PLC).
A few other structures include a social enterprise, unincorporated association, and offshore company. A single owner can start a company by registering as a sole trader. However, the burden of availing of National insurance and taxes also falls on the same owner.
Freelancers can register their businesses as sole traders in the UK. All owners must also register the business with Her Majesty’s Revenue and Customs (HMRC) for taxation. However, limited companies require registration at the Companies House.
The application for limited companies remains acceptable both online and offline at the Companies House. Owners have a duration of three months to complete the registration and avoid paying financial penalties.
Additionally, people planning to migrate and start a business in the UK should avail of Innovator, Start-up, or Investor Visa. The Innovator Visa is available for candidates with an investment budget of £50,000 and costs £1,021.
However, the guidelines for UK citizens differ from people that want to migrate to it. Also, they require the following specific government guidelines and English language skills.
Business owners with limited investments can start their company. However, spending personal money to avail profits can have repercussions. For example, if there is a loss to the company, then the money becomes irredeemable.
Low investments can delay targets, avoid making required investments in equipment and structure, burdens the owners with everyday tasks, etc. However, owners can avoid these circumstances by availing funding from various sources.
A few options include banks, crowdfunding, angel investors, New Enterprise Allowance, Start-up loans, and significant issue investments. The amount can range from a thousand to a few million pounds depending on the type of funding.
However, acquiring such funding requires a business plan. It includes the business name, purpose, targets, forecasts, market research, analysis, cash flow statements, etc. Developing a business plan proves much more useful for owners. It helps to stay on track and achieve goals.
Traditionally, the most significant expenditure for new business owners consisted of an office. However, with the development of shared spaces, the monthly expenses have considerably diminished. But owners need to find a suitable premise for business operations.
Freelancers or self-employed sole traders have the privilege of registering their home addresses as offices. However, it becomes highly inconvenient to take meetings, hire new employees, and client conferences as the business flourishes.
Besides this, the working environment must follow through with the health and safety regulation inspection. Owners should decide the types of insurances required for their businesses. These include insurances for commercial property, contents, employer’s liability, health, professional indemnity, public liability, and vehicle.
The business would also incur costs of different licenses required for outdoor music playing, event organising, serving food, etc. Owners can check the UK government’s license finder to find out more about them.
Additionally, business owners must develop office guidelines for all employees, rules of transactions, and storing information.
The final step for becoming a business owner in the UK involves managing finances. This step becomes useful during taxation, clearing debts, generating cash flow statements, and calculating profits.
Financial tracking involves record-keeping of bank statements, cashbooks, electronic sales, hire purchases, invoices, receipts, mileages, personal business expenses, P60s, payrolls, rent books, and stocks.
Owners require VAT registration in thirty days post exceeding annual turnover of £85,000. The business can recover VAT returns quarterly after a successful registration. Entrepreneurs need to cover NI and taxes but can recover tax relief.
Besides following these steps, owners must obtain business advice. Professionals from banks, government offices, local authorities, and others help find solutions to start and grow a business.
Furthermore, owners would require staff to conduct operations. Entrepreneurs must abide by the minimum wage rules while hiring employees for their organisation. Owners can hire foreign staff with UK citizenship to lower costs, set up the business, and expansion purposes.
If hiring becomes a difficult task for the owners, professional outsourcing companies can prove beneficial.
Jennifer Powell embraced finance writing just the moment she started working as a finance executive with EasyCheapLoan, which is a direct lender in the industry. Jennifer has an exceptionally keen eye for details and used her skills to pen down numerous blogs and articles on finance. When asked, she simply replies with a look on her face that shows how genuinely she cares for people struggling with financial problems. Jennifer works dedicatedly as a finance professional and considers sharing both her experiences and knowledge to increase the financial literacy of people and businesses.
