Questions to Ask Yourself when Writing a Business Plan

A considered business plan will not only help you get organised and crystalise your vision, it is also essential if you are seeking outside funding.

1. What should be at the beginning of my business plan? 

The executive summary, this should be 6 short paragraphs on the following subjects to give an overview of your business. This is your big opening number so keep it concise, professionally presented and attention grabbing!
What the name and function of the business is.
What makes you unique within your industry.
How you are going to become known to your target audience.
How you will structure your business.
Top line finance facts outlining when you expect to break even, potential revenue and profit projections. Have detailed reports to back up these attention-grabbing figures. Note you will have chance to go into more depth in your analysis section (see point 2).
State how much money you are asking for and what the investor(s) will get in return.

2. What analysis should I do? 

After your executive summary should come your analysis section full of facts to make your potential investor realise this is their one-way ticket to private island ownership!
There are many areas and types of analysis you can carry out either before starting your business or prior to writing your business plan. It is good to decide which you think are necessary/most helpful, consider if it is possible for you to gather useful/accurate data for the report and how long to spend on the process. Add attractive headline statistics from your findings to your business plan and have the in-depth reports to back your figures up if questions are asked.
SWOT (strengths, weaknesses, opportunities, threats) analysis. This is usually presented in a grid format on one page with bullet points. This kind of breakdown can be applied to many different areas of your business as well as your competitors and the industry as a whole.
Quantitative data and qualitative findings. It is best to have a mix of these within your business plan, ignoring either can leave serious blind spots in your presentation and business strategies.
Financial projections. You may need a professionals help with this one but if you are asking for any fiscal input, investors will need to see that their contribution will eventually yield a return. Be honest, adjust your plans inline with the numbers and be certain you can achieve what you say.

3. Have you thought about the day-to-day running of your business? 

You may have already started your business and are writing a business plan when looking for investment. If this is the case explaining the operational factors behind your business will be easier, but this is a good chance to review them and see how you could improve them. Do this and add it after the analysis section of your business plan.
Alternatively, if you are writing your business plan pre-start up or during the beginning of your journey to going full-time with your venture, this is where you get into the inner workings of your business to help investors visualise the dream. This part is relatively straight forward but demonstrates you have considered the practicalities of your operation.
Staffing, team members, contractors, freelancers, mentors, outside advisors. It is good to have these laid out in a hierarchical flow chart and to briefly outline what each person’s experience will bring to the business.
Premises. Even if you are an online business you will need to state where stock will be stored and shipping will be done from.
Record keeping. Explain how the administration of the business will be kept up to date. Include details of your accountant here.
And hey presto, you have your business plan! We would always advise putting this together pre-start up, even if you are not looking for outside investment just yet. It does not have to be super slick or go into minutia detail if you are not presenting to people outside your business, it can be a great opportunity to take a step back and see the bigger picture to ensure you are on the right track and have not missed anything.

IT Equipment for Small Businesses

Every business, no matter how big or small, will need some form of equipment or technology for their day-to-day running. As part of your planning, you should consider what technologies you need to get up and running and what equipment/software would be good to have in the future to help you grow or streamline operations. In this article we will run the basics for most businesses.

1. Hardware – Computers, Laptops, Phones. 

It is likely you will need at least one computer to run your business. Some companies have a BYO technology policy, this may work for you however consider cost to the employee and security issues that may arise. If you do need to buy a device for a member of staff shop around, consider their needs (remote working, going to meetings with clients) and the software that they will need to ensure you get the right one for the best price. If you or an employee needs a phone you can put this on a business plan which will be cheaper than personal plans. Also don’t forget to put purchases for technology through your books to enable you to claim tax back (if you are VAT registered).

2. Software 

This will vary greatly depending on your business and we will go into some essential ones further on in this article. The Office Suite (Word, Excel, PowerPoint etc) will be the most common and can be purchased on a business plan. If you need creative software, like Photoshop, Illustrator etc., this may affect the choice of computer or laptop you decide to buy. Mac’s are great for design software however come at a premium and can cause compatibility issues if other employees are working on PC’s. The Abode Suite including these programs charges a monthly fee of around £40 per user so if you are planning on only using these programs to make marketing material & social media content consider using online template platforms such as Canva which are easy to use and a lot cheaper.

3. Network 

You will need to set up a network if you have several employees working together that need to share documents or use printers. What kind of network you’ll need will depend on how many devices you need connected. For 5 or less users you can set up a simple network, bigger businesses may need multiple routers and large organisations will need to build their network around a server.

4. Accounting System 

Setting up accounting software for your business is essential. It will mean you can easily and quickly keep all your transactions in order making your accountant love you and ensuring you don’t fall foul of the taxman! Accounting software is simple to set up and can be done online in minutes. Quickbooks, Xero and Sage are all designed with small business owners in mind and are great options to get you set up. Larger firms may want more developed software which you can integrate into your systems and customise to your needs.

5. Payroll Software 

There are free versions of this all, alternatively the above mentioned accounting software brands offer payroll software as well. If numbers aren’t your thing, you have many employees or are time-poor having this software can be of great benefit to you. It makes difficult calculations, carries out repetitive tasks and gives you peace of mind when it comes to getting your workforce paid correctly and on-time.

6. Inventory Control System 

As your business grows or if you have lots of stock to manage an inventory control system can help keep you organised. Again, most of the companies that offer accounting software have inventory management systems that can be easily integrated into your business.

7. CRM (Customer Relationship Management) 

This is a system where a business administrates interactions with customers and potential customers. MondayCRM, Pipedrive and Freshworks CRM are some examples of software that can help you build customer relationships, analyse data, and manage client information. As your business grows these systems will become increasingly useful and can be a vital tool when scaling. Some training for staff will be necessary but this will be offset by increased efficiency and streamlined customer interactions.

8. Cloud Working 

Traditionally software such as Office programs would be downloaded individually to each an employee’s computer however now you have the option of having all your company’s documents on the cloud. This is particularly useful for remote working (each person has a log in to access documents from any device), sharing files, reducing initial spend on software and saving space taken up by lots of documents being saved down onto computers.

9. Payment Options for Customers 

Online integrations 

Along with other benefits of having a website, setting your business up so customers can purchase online can add revenue streams, enable you to reach customers all over the globe and allow purchases out of your regular ‘opening hours’. PayPal, Worldpay and Opayo (previously Sage Pay) are some popular examples; some of these can be integrated into your current website and some will need you to build a website with that provider. If you offer a subscription service consider setting up a Direct Debt option for customers, this will stop you from having to bill people constantly and make it easier for customers as their payment goes to you automatically.

Card machines at point of sale 

If you run a shop, restaurant, mobile salon or stall you may want to purchase a card reader. There are many options to choose from; check out details on the most popular ones here.
Plans are different for each one, some have one off payments and some are rental arrangements. Most have a small fee they charge, sometimes it’s based on the transaction amount, number of transactions or overall monthly revenue that goes through the device.

In summary … 

You may not always have a large amount of spare cash to spend on IT equipment and technology when you start your business so build up as you go, shop around for deals and consider finance/leasing as alternatives. Using technology to make it as easy as possible for customers to purchase your product is the priority. Having computers fast enough with enough memory for your employees to carry out their duties effectively is also a must. There are a lot of free or low-cost software’s available to help you run your business more efficiently from accounting systems to social media design and scheduling tools. One last thing to remember when it comes to your businesses data is – have a back-up! Ensure important information & documents are secure and backed-up devices are regularly updated just in case you have a system failure.

How to Find a Premises for your Business

You’ve decided you do want to have a bricks and mortar location but you’re not sure where to start. We’ve outlined the foundation for your business property.

1. Make a specification for your ideal premises considering internal and external factors. 

You may not find a location/building that ticks all the boxes but aiming for as close as possible is the best place to start. This will also make it clear for you what is non-negotiable and what can be compromised on or worked towards in the future. Factors to include in your specification should be
Location. Evaluate this not only in terms of your customers but also employees and suppliers.
Transport & parking facilities. Again, this should be considered in terms of customer access and employee.
Requirements of the building to carry out business. Depending on the nature of your business you will need the building to work in different ways, think very practically about the space, power points, equipment, ventilation etc when making this list.
Legal issues. If the building already has permissions for your businesses ‘user class’ moving in and alterations you may want to make in the future will be less complicated.
Type of tenure. Your options are license, lease or buy. We will go into further detail on these below.
As you would when looking for a place to live, set you maximum price, including taxes and fees and stick to it.

2. Should I license, lease or buy my work premises? 

As with everything this very much depends on the nature of your business and your plans for the future.
Licenses are short-term contracts (usually 2 years), can be in serviced buildings, have subsides from local authorities to encourage small businesses to set up and have no legal fees. However, you may have to share your space or be asked to leave at short notice by the landlord. Also these spaces will probably not be suitable for a food or manufacturing business. If you just need office space and you’re just starting out this is a good place to start.
Leases are longer term commitments (3-25 years), more freedom to adapt the space, the landlord is liable for external building repairs and more types of properties on the market to choose from. You may want to build break clauses into the contract just in case and agree with the landlord on alterations you want to make before signing on the dotted line. You may also be required to return the property to its original state on vacating, e.g. removing equipment, putting walls back in if removed etc.
Buy freehold. Owning your own premises is more unusual but can be a great asset and mean you have a permanent location under your control. This is a more expensive option though with most commercial property mortgages requiring a 30% deposit.

3. Where do I look for commercial premises? 

You can go the traditional route and get an estate agent that specialises in commercial property however it may be wise to consider some alternatives. Use your personal contacts in an area and business advisors/mentors to find out about potential venues. Also check with your local authority, they will rent business space as well as domestic housing. With this same idea approach local organisations such as the Chamber of Commerce in your area who may be able to advise and help you find the perfect location. Finally, you can engage a chartered surveyor to carry out the search for you. Unlike estate agents who operate on the landlords’ behalf, a chartered surveyor will have your best interests as the priority. They will know the market well, present a short-list to save time and be experienced negotiators.

Resources for finding the perfect property 

Search for a surveyor at the Royal Institution of Chartered Surveyors (RICS) here.
Get thinking about the future, find out more at the Planning Portal about planning permission here.
Contact your local authority about the type of property you need and see what financial help is available to you.

What are the Finance Options to Help Grow my Business?

You’ve been running a little while now, learnt a lot of lessons and had some very late nights and you feel it’s time to take your business to the next level. You won’t always have the cash in the bank or the revenue from your customers to get you there so you may need to source finance. We will go through the basics of the different types of finance and varying sources you can get money from in this article.

1. What are the different sources of finance to help my business grow? 

Bank Finance. The clue is in the name with this one, you can apply to your current or other banks for finance. You will be required to show detailed financial records, present what you plan to do with the money and may be refused.
Alternative Debt Finance. Born out of the last financial crisis, the requirement to have alternative sources of debt finance boomed as SME’s, in particular, need easier methods of sourcing funding. This form of debt often involves less paperwork and the time to complete is usually quicker than bank finance. In return, business Directors’ are often required to provide Personal Guarantees and interest rates are usually higher.
Equity Finance. This is when you give away a proportion of your business in return for money. This can be done publicly or privately, through individuals or firms.
Government and Public Initiative Grants. You won’t have to repay this money but there will be specific criteria you will have to meet. Grants will usually not cover the entire cost of a project and/or growth plan.
Crowdfunding. You will be asked to put a proposal together which will be shown on the crowdfunding platform. You will be required to give something to the investors in return for their investment and this usually increases depending on the amount of money an individual contributes. For example, someone that contributes £50 will get early access to products and some that invests £500 may get a hamper of all your best products. You will also have to give all the money back if you do not hit your initial stated target.

2. What is the difference between equity and capital? 

This may seem obvious but it is important to ensure that you have your terms straight when deciding and discussing with potential investors. Equity describes the control over a stake/number of shares in the business. When investors or firms ask for equity in your business this could be a percentage with you remaining in control, a controlling percentage of the business as a whole or they may want to buy you out completely. Capital refers to the introduction of investment either from existing Shareholders/employees or via external parties. This can take the form of debt or equity.

3. What are some terms to know when looking to finance the growth of my business? 

Equity capital – you are selling a share in the business to the investor and sometimes they will be become an adviser to the business. They will use their expertise in industry to help with top line strategy because the more money the business makes, the more money they make.
Debt growth capital – this is where you take out loans to fund your growth plans and don’t relinquish any control over your business.
Working capital – this is the money you have/need to fund the day-to-day running of your business. It is not used for growth plans.
Growth capital – money you have/need to grow the business in any form, for example, loans, debts etc.
Venture capital firms – these firms will be interested in investing in new start-ups with massive growth potential.
Growth capital firms – will be interested in investing in more mature companies that can see the potential of their growth plans.
Private equity firms – a leveraged buyout, they will be interested in getting the controlling stake of the business.
Public equity – by floating your business on the stock market you will receive money for shares in your business from the public.

4. How do I write a pitch to attract external finance? 

This is where your trusty business plan will come in. You may need to write a couple of different versions to use in your pitch depending on who you are talking to. Government grants will have different interests to private investors or banks. Identify what would make your business most attractive to the audience you’re presenting to and adapt accordingly. Have all your facts and figures to hand and know them inside outside. Practice your presentation and have an elevator pitch ready for those chance meetings with valuable connections or potential investors. Go to your local business growth hub for advice, they will be help you to organise and write your proposal, make you aware of any grants available to you and potentially point you to private investors.

Invoicing for Small Businesses

We’ll look into the basics of invoices and then how you can use invoice financing as a tool to get a quick injection of cash.

1. What is an invoice and why do I need them? 

An invoice is a formal request for payment from a customer that has received goods or services from you. It is an itemised document that clearly states what they brought and how much they will need to pay. Invoices are part of bookkeeping and need to be clear, accurate and organised.

2. What should I include in an invoice? 

Google sheets have invoice templates, so do cloud based accounting systems such as Quickbooks or Xero. You want all your invoices to have the same format and look professional. Ensure you include the following:
Business logo.
Your businesses contact and billing address.
You clients billing address.
Invoice number. These need to be sequential and are essential to keep things organised as they refer to that invoice alone.
Amount due.
Date you issued the invoice. This should be as soon after the goods or services are provided as possible.
Due date of the payment.
In a table you should have a further breakdown of what the services/goods purchased with individual prices. This can be the flat or hourly rate charged. Also have a column for quantity purchased.
Tax should be stated separately. Please see VAT section below for more details.
Payment terms. This is the amount of time you have previously agreed with the client they have to pay the invoice. It’s usually stated as ‘Net – number’. For example, if you’re client has 30 days to pay the invoice the payment terms will be ‘Net 30’.
Personal note. Add a thank you and any other information that you think would be useful for the client.

3. How should I keep track of my invoices? 

The invoice number will help you do this. Set them up sequentially and have your own spreadsheet which is updated every time you send out an invoice. Carry out a weekly review of who is due you pay you and send a friendly reminder if they aren’t a regular client. You can also save a copy of the invoice in folders, think how you would like to organise these in line with your type of business. Is it more useful to organise them by invoice number, month sent or possibly, by client? Most businesses send their invoices by email, save as a PDF that can’t be edited and attach to the message as timely as possible.

4. What’s the difference between an invoice and a receipt? 

Although very similar a receipt is issued after payment, an invoice is a request for payment. Be aware that an invoice isn’t legally binding within itself. To make a transaction legally binding you need to have a contract signed between the two parties or, at least, have an agreement in writing of some sort, for example an email exchange. To cover yourself it is good to outline what your payment terms are, what services/goods you will provide and what the costs will be to ensure you and your client are on the same page.

5. What is a VAT invoice and when do I use it? 

If you and your client are NOT VAT registered you shouldn’t issue a VAT invoice. You should simply charge for the goods/services provided including the information from point 1. If you and your customer are VAT registered you are required by HRMC to provide a VAT invoice for goods/services subject to sales tax. This also applies if the invoice between the two VAT registered parties includes non-sales tax items. VAT invoices look very similar to regular invoices but include a little more information:
Your VAT number
The VAT rate(s) charged
The total amount before VAT
The total amount of tax due
The total amount due including VAT.
Now we’ve gone through the basics of invoices, we’ll explain the basics of what invoice financing is and how it can benefit you.

6. What is invoice finance? 

You can use your outstanding invoices to raise cash for your business quickly. You can sell the invoice to a company or borrow against the invoice, both minus a fee. Some companies will require your company to be a certain size and want all your outstanding invoices sold/borrowed against together, others will be happy to work with smaller businesses and allow you to select which invoices you raise cash with.

7. What are the types of invoice financing? 

Factoring – this is when you transfer your invoice debt to a company. They take a percentage or charge a fee and give you the cash. You have transferred the invoice to them so they are now reasonable for collecting that debt. This is traditional invoice financing and usually involved you handing over a chunk of or all your outstanding invoices.
Selective – this is where you choose which invoices you want to ‘sell’. You may only need a smaller cash injection so this may make more sense as the company will only take the fee from that selected invoice(s) rather than all your outstanding invoices.
Discounting – this is a loan based on your outstanding invoice(s). You borrow money against the value of your invoices and then pay the invoice financing company back after your client has paid.

8. When should I use invoice financing for my small business? 

Invoice financing can be a quick way to get a good amount of urgently needed cash into your business. When deciding on if you think it may work for you consider
Contracts – make sure you’re not tied into long contracts, large contract termination fees, handing over more invoices than you want to.
Shop around for the best percentage – traditionally the majority of invoice financing firms wanted to work with large, well established companies however the industry has change drastically in the past few years with much more flexible plans and options available to you.
Use this as a short-term solution – when you’re a small new business your suppliers may negotiate longer payment terms with you, build relationships with them to get them to pay invoices quicker and use invoice financing in the meantime.

How to Lease Equipment for your Business

Buying equipment outright for your business may be an expense out going early on so you should consider leasing where appropriate.

1. What are the benefits of leasing equipment? 

When setting up your business, depending on the nature of your industry, you may have a lot of out goings to begin with. There are different kinds of leases / finance you can get which we will detail below. You can get 0% interest on some finance agreements, spread out payments to help with cash flow, tax relief on energy efficient equipment and can even have maintaining and servicing included.

2. What types of finance contracts are there? 

Hire Purchase. You will pay instalments and own the equipment at the end of the agreement.
Finance Lease. You will pay instalments but won’t own the equipment at the end of the lease. The rental company will sell the equipment at the end of the lease and you will receive a pre-agreed amount of the proceeds.
Operating Lease. You will pay lower instalments but won’t own the equipment at the end of the lease or get any proceeds from a third-party sale.

3. Do I have to add leased equipment to the balance sheet? 

If you buy or use hire purchase for equipment for your business, it will have to be added to the business’ balance sheet however if you use finance lease or an operating lease it may not. If your total payments, excluding maintenance and servicing, amount to less than 90% of the total market value of the piece of equipment it won’t need to be added to the balance sheet. Ask the leasing agent or your accountant for a valuation if you’re unsure.

4. What should I look for when leasing equipment for my business? 

Do you need to purchase consumables along with the equipment and how is this covered by your payments?
Check the age and authenticity of the equipment, ask for evidence in writing.
Even if you have no intention of buying find out what the market value of the piece is.
What maintenance and servicing are included in the deal? Does it include spare parts? Make sure you’re clear on the costs of these and they are stated separately on the contract.
Check the process if you get faulty equipment or it breaks down completely.
What are the possibilities for the structure of the payments, example a balloon payment at the end of the contract?
Be very specific with the requirements of the equipment you need and what kind of contract would work best for you. Get at least 4 quotes from different companies, 2 larger more well-known places and 2 lesser or local leasers. Know the market value of the equipment, new and second-hand and use this to evaluate the quotes given.

How to Create a Business Strategy

At the beginning and throughout the life of your business you will have to create strategies to give your self the best chance of success. These can be as formal or informal, whichever works for you but should never be underestimated or ignored. Your business strategy will feed into your business plan, will be a ‘working’ document and can be focused on the whole or certain areas of your business.

1. What is a business strategy? 

Your business strategy is the plan outlining how you will achieve your business goals. To begin with these can be informal and in a format that works for you – a long form written documents, excel checklist, flow diagram etc. Set objectives and work backwards to detail how you can achieve these goals. If you are writing a business plan you will use your business strategy as part of this.

2. How do I write a business strategy? 

Carrying out a SWOT (strengths, weaknesses, opportunities and threats) analysis is a great place to start. This can be focused on your industry as a whole, your individual business or your competitors. There’s a thousand different ways to cut the cake with this one so stay top line to start with and discover where you need to focus in on.

3. What areas of my business should I have a strategy for? 

The short answer is all of them! These are the main ones to focus on when starting out.
Overall business high-level strategy. This will include elements of each of the following and set out what your USP’s (unique selling points) are and how you’ll use them to get ahead. Set goals for your first 12 – 18 months to refer to when things get busy and you are bogged down in the day-to-day running of your business.
Marketing strategy. Figure out how to communicate your message to the outside world. See our Marketing basics advice here.
Pricing strategy. Trying to under cut the competition may get you a quick win however it is a dangerous game to start playing as you will create an environment that the only way is down. Competitors may find a way to provide good/services even cheaper and there is no way as a small/independent business you will be able to get prices lower than large multi-national conglomerates within your field. Using a low price point teamed with differentiation or niche targeting may be a wiser way to go.
Social media strategy. This will fall under your marketing strategy but given the power of social media it is wise to have a separate section so you can really plan out how you will utilise social media to maximise its potential for your small business.

4. Are strategies really worth the time taken away from my business? 

“Everybody has a plan until they get punched in the mouth.” – Mike Tyson
This quote may perfectly sum up how you feel when trying to come up with strategies during the early days. Remember strategies are made to be constantly evolving and reviewed continually. Set a strategy day in the diary every month to begin with – and make yourself show up for it! It’ll give you the reset you need and you’ll be able to identify problems and correct plans accordingly. We would leave some space on this day dedicated to research. For example, if your social media isn’t getting much traction put aside time to breakdown and research what competitors are doing, what business gurus advise and what the all mighty google thinks you should do. Also, within this day add thinking time by going for a walk without headphones in to think about the issue. It is very easy to not give yourself space to breath and consider your actions because you are too busy doing them!

Employment Types & Contracts

There are different types of employment agreements, all of which are have legal requirements. Not only this but contracts are very beneficial for both the employee and the employer. There are four main types of contracts that you can use to hire employees, these being permanent, freelance, self-employed and zero-hour contracts. Each of these contract types come with different benefits for your business, so it’s important to understand each of them properly.

What is an employment contract? 

A contract of employment is a legally binding document between an employer and an employee that outlines conditions and legal requirements of your employment, this usually includes but isn’t limited to responsibilities, benefits you could be entitled to and your salary amongst others. If any information changes throughout employment, an updated contract must be issued siting these changes.

Permanent 

This is probably the most common employment contract in the UK. The definition of a permanent contract is one that does not expire and will remain valid until either the employer or often the employee chooses to end the contract. If you’re looking for an employee who is working full time and on regular hours for your business, then this is the contract for you to use.
Full time permanent employees usually work between 35 and 40 hours per week while part time permanent employees will usually work under 35 hours per week. Permanent contracts also cover those people who are salaried or who work for an hourly rate and also entitles the employee to the full range of benefits and employment rights as well as their working hours, terms of payment and their responsibilities.
Advantages 
Disadvantages 
Dedicated team
More administrative work
Easier to plan out future
Increased liability
Potentially higher costs if you offer benefits

Freelance 

If you’re looking to hire freelancers or people who you only need for a set period of time, then you’ll be looking to hire someone on a fixed term contract. Freelancers are ideal if you need temporary and want to avoid potential issues such as training, hiring and employee benefits. Freelance workers frequently work for more than one company at a time although individual contracts may specify sole employment for a time period agreed upon.
Advantages 
Disadvantages 
Cost
Lack of understanding your business
Usually quick and easy to find
Can not invest in freelancers eg. training
Knowledgeable with experience
Uncertain quality of work

Self-employed 

Although freelancers are considered to be self-employed, they offer their services under contract for other people. In the UK, being self-employed is a person working for themselves and often running their own business as a sole trader or as part of a partnership or limited company. Employing self-employed people to work for your business is like hiring freelancers and comes with the same advantages and disadvantages.

Zero hour contract 

Zero hour contracts is a non-legal term which is used to describe different types of casual agreements between an employer and an individual. These are also known as casual contracts and are usually for ‘on call’ work or ‘piece work’ meaning that they are usually on call when you need them, however you are not contracted to give them work nor do they have to accept the work when offered and asked of them. Zero-hour contract workers are entitled to statutory employment rights, including paid annual leave, rest breaks, protection from discrimination and must also be paid at least the national minimum wage regardless of how many hours they work. Zero hour workers are also able to work elsewhere and they are by law able to ignore clauses in their contracts if it bans them from either looking for work or accepting work from another employers.
Appropriate use of zero hour contracts can include:
Seasonal work
New businesses
Special events
Advantages 
Disadvantages 
Easy access to workers when needed
Zero Hour Workers aren’t always available
No need to train new people
Likely high turnover
Lower costs than having permanent staff

How to Start an Online Business in the UK

With changing habits and lifestyles, people have become more aware of how they utilise their time. Online shopping has become increasingly popular over the past few years but never more so than in recent months where physical shops were forced to close their doors and selling and buying online was the only option.
Starting an online business will have some similarities to that of starting a traditional brick and mortar business and in addition there will be other factors to consider. The initial setting up of your business will depend on the type of business you intend to run, where you will be working and whether you will take on people to help.

Get your online business idea 

The first step would be to decide what kind of business you wish to set up. There are a number of websites available that you can use to help determine what kind of market you wish to operate in should you not already know. However, if you are thinking of setting up your own online business, more often than not you usually already have some kind of idea as to what you want to do.
Once you believe you have a viable business idea and have decided on your chosen product(s) or service, it is essential that you carry out market research extensively. By researching and testing out the market you will be able to determine whether your business idea has the potential to be successful or not. Market research can also help you plan your next steps and map out how to set up your business, giving you an idea of start-up costs and any kind of funding that may be available to you as well as helping to define your target audience, pricings you should set and of course who your competitors are.

Create a business plan 

After you have carried out your market research and feel you have a sufficient amount to be beneficial, you’ll need to create a business plan. This is a great way to pull together all that information you have collated and visualise how you see your business in one form of documentation. This will be your working document that you will be able to refer to and add or change over the course of its time. This is also paramount when you are trying to get funding for your business.
Also consider your social media and marketing plan, a presence online is very important and gets your brand out there to potential customers.
For more on how to create a business plan read our advice here and to learn more about how to put a business strategy together read more here.

Choose your online business model 

As you have now established what kind of online business you are going to set up, you need to ensure your online business model suits your plan and gives you a structure to work with. The two main options which tend to be the most popular are ‘sole trader’ or ‘limited company’.
A sole trader tends to be the best option for those people who are looking to start up a small business. You and your company are seen as one entity and therefore any profit or loss will affect your personal finances.
A Limited company will offer you protection as your company is seen as a separate entity giving you limited liability.
If for example you are intending on starting an online shop or selling a product(s), you’ll be operating on an ecommerce business model making revenue from sales.
There are various models that you can choose from but it’s important to pick the one that suits your and your business best.

Decide your business name and register 

Before you register your business, you’ll need to come up with a name. It’s important that you remember to make sure that both your business name and domain for your website are available. It will be much easier for customers to find your website if these match, if they are different, this can lead to confusion and even loss of business as your potential customers can be directed elsewhere.
You can easily check if your business name and domain name are available when National Business Registers search here. Learn more about registering and protecting your business name here.

Prepare for the costs of setting up an online business 

These will vary dramatically depending on the size of your start up business as well as the type of business that is being started. However, some of the costs that will need to be considered are:
How much it will cost to build an inventory of the products you will be selling.
The equipment you would need to use, for example, technical equipment.
The cost of building a website.
Marketing costs and possible outsourcing of this.
Company formation costs, if you decide to go with a limited company structure.
Domain cost, there is usually an annual fee behind this.

Build your website 

Whether you decide to do this yourself or outsource, the website you create should reflect your business and ensure you align your vision with the web developers. Consider the user experience (UX), this should be easy to navigate and use. The aesthetics and logo, ensure your site is appealing and organised and finally ensure your site is mobile friendly, a vast majority of people use their devices to access sites and this is only getting more popular.
If you will be selling goods, consider payment methods and how you will be charging your customers and what online payment system you will be integrating into your website.
There are many elements to consider when starting your own online business using this simple guide to get started can make all the difference and give you that added confidence boost you may need.

What you need to know about HR for your Small Business

The world of the business can be a confusing place. There’s a lot of different facets that you must consider such as finances, sales, marketing and, of course, the minefield that is HR.
Compared to other aspects of your business you’ll probably find HR to be one of the trickiest areas to get to grips with, as it’s based not just on best practice, but on legal requirements that you must abide by. This can make it a confusing place for most business owners, but it doesn’t have to be. There are a small number of basic elements that you need to focus on when it comes to running HR for a small business, and if you get these right, then you have a good basis for further development.

What exactly is HR? 

HR (Human Resources) is the department that’s responsible for the administrative functions of your business. HR teams oversee recruiting, interviewing, hiring new staff, looking after employee benefits, and they can also be involved with areas such as payroll and appraisals.

What are the most important areas that are essential to have the basics of HR covered? 

For a small business there are a few specific areas that are highly important that HR handles. These include:
1) Recruitment
2) Onboarding
3) Payroll

How does HR help with recruitment? 

Having the right team in place to help grow you business is an essential part of the long term health of your organisation. With the right HR help you can ensure that you have a team of employees that have the right skillset to boost business performance. Your HR team can help with this by:
Helping plan out job specifications to meet your needs
Planning interview questions
Checking that potential employees have the right to work in the UK

How does HR help with onboarding? 

Once you’ve hired someone with the help of your HR team, you’ll need to make sure the basics of onboarding are covered as well. Luckily this is something that a HR can help with as well.
A full and thorough onboarding process can take up to 12 months, but it an essential part of your business process that encompasses areas such as:
● Issuing of formal contracts
Legally every employee is required to have written documentation that outlines the key terms of their employment such as pay and working hours. This is required to be in place within two months of the start date.
Contracts should also outline areas such as holiday allowance, pensions and other areas that have statutory minimums. As contracts are legally binding it’s essential that these are handled correctly, and an expert in HR may be needed to do so.
● Managing legally required admin and paperwork
Contracts aren’t the only form of paperwork needed when you’re bringing a new employee in. Other bits of paperwork are needed as well, and HR are primed to help handle this. This not only makes the onboarding experience smoother for the business and new employees, but it allows everyone to focus on their actual job rather than legal necessities that don’t impact directly on the new hires job performance.

How does HR help with payroll? 

Payroll is likely to be the biggest expenditure that your business has, which is why it’s essential that you’re able to get to grips with the process. For small business though this can be an incredibly tricky as they may not have a department to handle it for them. With a HR team or person though, you’ll have someone responsible for payroll who can manage the process for you, keeping your process up to date with laws, and ensuring that everyone is paid on time.