Starting a business in 2020

Many parents look to start a business to get greater flexibility and technology has made this easier. If you are thinking of branching out on your own in 2020, workingmums.co.uk has lots of advice for how to start.

Woman standing behind window with words on and success ticked

 

At the start of any new year, many people’s thoughts turn to what they can do to change their lives for the better. For many parents that involves getting a better work life balance or at least having more control over their lives. For some that means considering going it alone and starting a business from home. While this may not reduce your hours, it can give you an ability to flex them around family responsibilities.

A new survey of 2,000 employees out today from FreeAgent shows that for women work life balance and being able to choose what work they do are prime motivators for starting a business with over 44.2% and 42.8% saying these are factors. Earning more money is the prime motivator for men.

While a third of the people questioned said Brexit uncertainty was a deterrent to setting up their own business on top of financial concerns, lack of confidence and dealing with tax, a fifth said they planned to start a business this year with 47% saying they would like to start a business at some point in the future.

Another survey out this week from Onecom found one in 10 mums went on to set up their own businesses after going on maternity leave, in large part  because their employer couldn’t give them the flexibility they needed. One in four said advances in technology and telecoms had made it much easier to set up a business.

While setting up a business is not easy, there is a lot of advice around which can help you make the first steps and, to get around financial concerns, many people are setting up and growing their businesses on the side of their work. Even if they fail, developing your business skills could come in handy for any employed work, given an ability to self motivate, come up with ideas and take an entrepreneurial approach are likely to be key in the future.

So how do you get started?

Where to begin:

The first thing is to decide what your business should be about.  Perhaps you can build on your existing knowledge and experience or a hobby or perhaps you have spotted a gap in the market. The important thing is that you feel inspired by the idea and that you go out and research your potential target market. Understanding them is vital to your success and will influence things like what you charge for your service/product. You can ask your friends and family what they think of your idea, but there are also free online tools like Surveymonkey which can help you do a targeted survey. Crafting the survey so that it gives you useful information is important so think carefully about how you phrase the questions.

Build a business plan:

Using the survey, you need to write up a business plan, outlining everything from your vision, your understanding of your target market, what your produce/service is, what the competition is, how you can compete, pricing, marketing, costs and realistic potential earnings. Review this plan on a regular basis – it is like a guiding map and will help you navigate as you scale up.

Competitor analysis

Make sure you keep up with your nearest competition and monitor what they are doing and how you can differentiate yourself from them.

Get support:

Get help in the form of a business mentor and network. There are many organisations that offer mentors, for instance, there is the Mentorsme portal. You can also contact your local Chamber of Commerce, other local business network groups, sector-specific groups or women in business groups and start networking. Don’t forget to use social media, such as LinkedIn to network. LI has a range of different network groups you can join.

Financing:

Understand the financials and where you can get help or investment. All financial models have a revenue side and a cost side. The revenue side is driven by price/fee of product/service and volume (number of transactions). The cost side is driven by the day-to-day costs of operating your business such as rent, wages (if you have staff) and other overheads. In addition, while starting out, you will incur set-up costs. Try and do a break-even analysis, which would show at which point in your business you will have recouped your set-up costs. It is a good idea to flesh out a realistic monthly forecast of revenues and costs against which you can track your performance. There are businesses that turn profitable soon after set-up and others that take longer so don’t be too worried if your business does not instantly break even. Your business might need capital injections at different stages of growth and it is a good idea to try and figure this out as part of your financial model.

Marketing the business:

In addition to a financial strategy you need to think about how you will market your business. Do you need additional help? If you are selling a product, are you planning on doing it directly online, via aggregators or via retailers? When approaching other companies to market products, you need to prepare a presentation that shows your vision, how you stand out from the rest and how much your product costs, both wholesale and retail. If you are a service provider, you need to promote yourself. In either case, you should have a web page which you regularly update and a social media strategy.  Pencil in specific time for this in your week if you are doing this on your own or you will find it sucks up a lot of time. When it comes to PR, you could think about hiring someone part time or you could try and do it yourself. There are resources out there to help you.



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