An increasing number of women are making the switch from nine-to-five drudgery to running their own business, allowing them to take control of their professional lives and achieve a better work/life balance. It’s a tough trading environment though, with banks and consumers alike cutting back – so it takes some savvy to survive. How can you make sure you and your business survive? Here are some tips to increase your chances!
Don’t slack on your market research
A simple one, but nonetheless very important. Market research is a vital early task, as it’ll tell you whether there’s really any demand for your product or service. It can also help shape further business decisions, including how you position yourself and the ways to best target your market.
Although it can be an arduous task, thorough market research will ensure that money isn’t wasted on things such as unsaleable goods or poorly targeted marketing campaigns. It’ll also help you sell you goods or service in the most effective manner to your target market.
If raising capital is difficult, considering alternatives
The UK economy is bruised and battered and the banks aren’t keen on lending, and if you need some start-up cash it may prove difficult. There are solutions though. ‘Bootstrapping’ (or running your business at a bare minimum of cost while you establish yourself) is a viable alternative if you’re willing to put personal funds into your venture, especially if you’re confident that you’ll soon be earning enough money to cover expenses.
Crowdfunding is also exploding in the UK. If you think there might be support for your business you can put yourself at the mercy of a Kickstarter campaign, and let the general public chip in to help get you off the ground.
Consider Trading as a limited company
Trading as a Limited Company brings a range of benefits, chief among them is greater tax efficiency and legal protection. Operating as a sole trader, you’ll pay Income Tax and National Insurance Contributions on everything you earn. If your venture goes well, once you get into the higher echelons of earning you could be seeing a significant amount of money going to HMRC.
In contrast through, operating as a Limited Company you’ll pay corporation tax on your profits (i.e. your entire earnings minus your expenses). If you’re bootstrapped, those savings could be the difference between success and failure. Limited liability also means if things go south your house and possessions will be protected.
Network, network, network
Networking is imperative to succeeding as a small business. It can generate contacts, lead to sales and even provide a sounding board for new ideas. There’s a wealth of national and local networking events, curry clubs and business breakfasts, which can all prove a useful asset in a mumpreneur’s business armoury. If finding the time for these events is problematic, social media platforms such as Twitter, Facebook and LinkedIn can similarly prove a useful source of contacts and sales leads.
It’s a difficult time to succeed as a small business, but using some nous it’s possible to upset the odds.
by Mark James.
Mark James is a writer, lover of football, and works for Crunch Accounting.