What do business owners wish they’d known before setting up?
Wherever you are in your business journey, you probably have thoughts about your initial set up. Maybe it was harder than you imagined or maybe it was a walk in the park. Each company will face its own unique set of obstacles, so it helps to be as prepared as possible.
But whether you felt completely ready for the stress of setting up your own business or had no idea where to start, you may wish you’d done things differently or planned your journey more thoroughly. Maybe you wish you’d educated yourself on cash flow, business grants and marketing budgets and were totally clear before you made the jump into the business world.
A recent article published in The Daily Star said that over two-thirds of business owners wished they’d chatted to experts before they set up their businesses.
This got Bionic thinking about other useful things to keep in mind when setting up a company, so we’ve written up a guide with advice from real micro business owners. Read on for more.
How to properly manage finances
Finances can be tricky to manage at the best of times. So, it’s no wonder that managing money is one of the main things microbusiness owners wish they’d been more prepared for.
The financial aspect of setting up and maintaining a business can take a lot of different forms. Whether that be things like actually buying premises, taking out a loan, buying stock, paying staff or balancing cash flow, managing money and funding your small business can be hard.
Although you may be pretty good at budgeting your personal finances, keeping a business running is a whole new scenario. That’s why you should always do your own calculations and work out how much you need to be making to stay afloat. Try to overestimate if possible so you have ‘spare’ emergency funds should you have a bad trading month or something unexpected happens, and don’t spend beyond your means.
For example, revamping your premises or buying a new one to expand may seem like a great idea if you are eligible for a business loan, but you should always work out if you can realistically meet the repayments each month to avoid sinking.
Sonya Roberts, who runs Brandon May Hair Salon said before starting a business you should have a clear plan. “Know your numbers inside out before you start!” she told Bionic, before adding “And fill in your skill gaps by getting a coach.”
Enlisting the help of a financial expert is great advice, but you can also use Google to brush up on basic knowledge for free. If you have the money to spend and would find it beneficial to hire a financial manager or bookkeeper to take care of the money side of your business, then look into that too.
Flo Broughton, who set up the popular treat business Choc on Choc told us that balancing the books was by far the hardest part of running a business and something she wasn’t prepared for as Choc on Choc grew traction.
She said “Cash flow can be a problem. Especially in the earlier days when we had to build stock.”
Lilac Miller, who runs Sleeping Beauty Salons had some top financial advice too, she said: “Don’t overspend on an idea until you have tested it. It’s better to start small and have room to grow. With one of our first premises, we took on a space and within a few years had maxed it out, so we took on the neighbouring property and knocked through. This was much better than overstretching ourselves from day one.”
Another core thing microbusiness owners said they wished they knew more about is the legalities of setting up a company.
This can cover anything from making sure you have the right insurance in place and having tenancy or employee contracts set up to protecting yourself if you end up needing legal aid. Health and safety issues at work can also be a minefield so it’s important to be as clued up as possible before starting a business.
Branding and copyright rules also come into the legal side of business, you need to be careful when coming up with logos and brand colours and ensure you’re not inadvertently copying another business.
Speaking from experience, Lilly Shahravesh, who owns the pet clothing brand LISH, said copyright infringements can irritate her, especially when she works so hard to make her products unique. She has dealt with a few businesses copying her designs.
“Copyright infringements are my biggest pet peeve.” She says “I suppose it’s quite flattering in some ways, but it does frustrate me as a business owner. I just try and keep changing and improving my designs all the time.”
Making sure you are following guidelines and not breaking the law by accident is so important but it’s even the little things that can often get missed, for example properly registering yourself with companies house and paying the correct tax and VAT on time.
Again, research is your best friend here and if you have the funds, finding a dedicated solicitor or legal professional when needed can be beneficial. There’s a lot of information about keeping in line with the law on the gov.uk website.
Another aspect that can be overlooked is the formalities of starting a business. We’re talking about the ‘how tos’ of setting up, the things you might think are self-explanatory but can actually be a lot more complicated than first thought.
For example, how do you actually apply for a business loan and how do you know which one suits your business needs? How do you interview and hire the right staff? How do you compare stock prices and how do you get customers interested in your products in the first place?
Anna Yu, who runs her own cake business said: “The biggest struggle I faced is that I just had no idea how to set up a small business, I still don’t. I have an Instagram and Facebook page, but you have to be really smart with hashtags and things like that” she tells us. “I think it’s hard to start up a business, you’re responsible for the whole thing and it's just you on your own. You have to buy the ingredients, set the prices and do deliveries.” she said.
Jo Tiller from The Social Club says sourcing stock was much harder than she thought and she wishes she’d known how it can be impacted by lots of different things
“Brexit, Covid and the whole situation in Europe is still causing a lot of issues for me. Stock has been held in shipping containers due to staff shortages. Plus, I’m really small compared to some businesses so I’m always at the back end of the line.”
Learning all you can before you start is so important, it might help to write out or draw a diagram, mind mapping all the different things you’ll need to do at each step of your business journey.
For example, when thinking about attracting customers, you need to think about your target audience, how old they are, what they like or don’t like and how best to reach them. Then you need to think about how you actually access these customers?
Are they a younger demographic who might respond well to social media ads? Are they more old school in a tight-knit community who might respond to flyers and stalls at community fairs? You need to break down everything you plan to do and ask yourself how you’ll get where you want to be.
First-hand tips from an expert
A great tip for those on the verge of setting up a business is to chat with like-minded SME owners or experts in your niche. This allows you to get an honest picture of the highs and lows so you can be more prepared.
As reported in The Daily Star article, a huge amount of SME owners wish they’d spoken to experts to find out the pros and cons first-hand. Real-life examples and advice are often much more valuable when you’re starting out on your own journey,
Lizzie Arkley who works for AtmosFEAR scare entertainment said speaking to other horror maze co-ordinators has helped them finesse their own ideas.
“With ‘FEAR’, a lot of our initial inspiration comes from the states.” Lizzie told us “In America their focus on Halloween is just out of this world, we’re only beginning to see that same scale over here. The scare operators in the UK work quite collaboratively though, so we’re always sharing ideas.”
A fun way to get social with other business owners is to do a quick Google search of local events in your area where business owners might be hosting talks on their own experiences. You could also look up podcasts and YouTube videos created by small business owners and learn about their journeys that way, there are lots of recommended business podcasts on Spotify, just choose one that applies to your type of SME.
Or maybe you could pop into some of your local businesses, tell them you’re setting up your own company and ask if they wouldn’t mind chatting face-to-face. Another great idea is to join a local business group where you can share tips and experiences. Bionic has actually set up a community recently in the hope that our microbusiness customers can share knowledge with each other, so why not join this?
Elaine Roberts who runs sustainable SME Wild and Pure said that community is such a huge part of running her business and sharing tips is the best part.
She said: “The groups are about sharing advice and all the information I share is relevant to the business. With the community, we have a Telegram group too, I want to cover all angles of finding people, they’re all local at the moment but I’d love to grow the group, Instagram is probably the best way to go with that. But I could be more active with that side of things.”
How to build relationships
Building relationships is a lot more difficult than it sounds. Whether that be with staff, customers or other business owners, talking to the right people can be tricky. There’s no clear-cut way to success but knowing what your goal is, who your customers are/what your staff need and believing in your product or service is a great start.
Tyrone, who runs Heroez Gym said the relationships he has with his members are what makes his business tick, he told us: “In business, I learnt quite early on there isn’t much loyalty. But that just means we have to work hard to draw customers to us and give them a reason to keep coming back”.
It helps to be approachable and friendly but also firm in your decisions. You want to be someone who is clear on their business goals and has a forward-thinking plan in motion. In regards to staff, try to be flexible and look at their unique needs. A working environment in which one employee thrives may be a struggle for another. Try to make changes that will allow everyone within the business to do the best for your customers.
Lilac, of Sleeping Beauty Salons, said that building rapport with her team has been valuable to business success, she said: “I’d say always show appreciation to your staff. It’s the little things that are important, like showing appreciation, never taking them for granted and always being happy to listen to their opinions, concerns and suggestions”
Lucy Bradbury who set up clothing shop Divine Trash echoed this sentiment, saying: “You’re only as good as your staff so make sure you recruit great people and treat them well.”
How to improve your brand
As we mentioned earlier, building your brand is really important when attracting customers, it’s also something business owners often forget about or think of as an afterthought.
But your brand is your business identity and can go a long way to cementing customer relationships, making you more trustworthy in the market and highlighting your best points. Social media is an easy and free way to work on your brand.
Work with influencers
There are other ways you can start building, working on your logo, making sure brand colours are unanimous across your socials and website and partnering with influencers that have the same values can help you get your business out there.
Jo Tiller of The Social Club says “I handpick the influencers I work with. It was tough in the beginning as I didn’t really know what kind of audience to target, I knew I wanted all the clothing to be organic and that can be a bit more expensive. It was all a little bit of a risk, but it paid off as it became more popular”.
She added “Growing our customer base organically is probably my biggest achievement. It wasn't easy. But we have three and a half thousand organic followers now. They’ve all come from word of mouth and recommendations. Just having a brand that people are enjoying is so rewarding.”
Ask for help when you need it
Abbey Booth who runs her own personal stylist company Stories With Clothes said branding is so important and she wishes she knew how vital it was much sooner.
She told us “If I could go back, I would invest in branding a lot earlier than I did, working on my brand got me thinking about my business values but it’s only the last few years I’ve realised the importance of it. I’m an expert in styling but not in marketing, so I wish I’d asked for outside help a lot earlier than I did rather than struggle on my own.”
So, there you have it. Real advice from real business owners and some helpful tips to aid you on your own start-up journey. Why not get in touch and share your business experience with us and connect with other like-minded SMEs?
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