The four essentials for every entrepreneur building a start-up
The advantages of setting up your own business are wide and varied. Perhaps the most attractive prospect for budding entrepreneurs is the thought of being your own boss, and therefore benefitting personally from any profits you make.
On top of that, the freedom that comes with being in charge means you can shape your company within your own vision, without anyone else telling you how things should be run. You can also decide with complete autonomy how any profits should be reinvested – perhaps in the form of new stock, marketing or by taking on more staff.
With such clear and obvious perks to running your own enterprise, it’s little wonder there were 381,000 UK business births in 2018. However, it’s also true that 336,000 companies went under during that same period.
With such a high turnover rate, nailing these four essentials is crucial to the success of any start-up…
It may sound obvious, but choosing the right product to sell is paramount. You need to find the balance between something for which there is sufficient demand without competing in an already saturated market. And, on top of all that, you need to be able to pitch your price at a competitive level to entice floating consumers to come to you.
It is estimated that 60% of start-ups will go bust within three years, while one in five will do so inside the first 12 months of trading. A huge contributing factor to those numbers is a lack of funding, as new businesses fail to reach that all-important level of sustainability. Data from the British Business Bank suggests that 36% of smaller businesses sought external finance in 2018-19, while awareness of alternative funding options continues to grow. Even having poor credit may not necessarily preclude you from securing capital, with bad credit business loans there to help those who fall into that category.
Complying with business law is an absolute non-negotiable for start-ups and firmly established companies alike. Some sectors are more heavily regulated than others, and there are a myriad of legislations to get to grips with, covering trading standards, advertising, employment law and copyright, to name just a few. Being fully informed about your legal requirements will ensure you remain compliant and do not risk potentially damaging reputational and financial penalties.
Having a great product and securing adequate funding is all very well and good, but if consumers are not aware of your brand then you’ll struggle to get your start-up off the ground. In the modern world of business, having a strong online presence is crucial, with 51% of people preferring to shop via the internet than visit high-street stores. With that in mind, having a good marketing campaign and an engaging social media presence is an absolute essential for making any new business a success.