So you have the basic premise for a new company, what next? A good product is an essential starting point but there are several factors to consider. A viable business plan is invaluable when turning your idea into a reality. Evaluating the points below will enable you to establish the framework for a successful and sustainable business. As the adage states, failing to prepare is preparing to fail.
1) Choosing a company structure
Different company structures are more suited to different products and trades. Consultants or professionals in fields such as accountancy or law, for example, may find a Limited Liability Partnership is more tax efficient. These firms often have few employees and little need to reinvest in the company as their main product is their knowledge.
In contrast, a builder or a taxi firm, for example, may find a Limited by Shares structure is more tax efficient. Savings can be made when reinvesting in capital, supplies, travel costs and so on. An accountant can advise you which structure is most suited to your needs.
2) Know the product and the market
If the market is already saturated with similar products it could prove difficult to increase your market share. Having a unique selling point or a competitive price in such circumstances is essential. Researching your potential competitors is also a useful way of gauging the viability of your idea. Understanding the demand for your product is vital, you are not going to sell many pumpkins in November!
3) Choose a purpose and assess your vision
Most companies are formed for the purpose of making a profit to benefit the shareholders. The profitability of a company, however, is not the only indicator of success. Whilst emphasis may be placed mostly on generating a profit, there may be other objectives you should take into consideration.
For example, companies may have specific social or environmental objectives. Companies may decide to create employment opportunities in communities where they are in short supply, source all supplies from ethical providers or be market leaders in innovation in industries where research and development are lacking.
Promoting such values can strengthen your brand and attract loyalty in customers and employees alike. If you have specific objectives in mind you can define these in the articles of association at the time of incorporation.
4) Plan your expenditure
It is rare for new start-ups to become profitable immediately. Managing the finances of a new company is imperative. Preparing a strong business plan will make it easier to secure funding if needed. If you predominantly operate the company online an ideal way of keeping costs low is by using a mail forwarding service. This would be significantly cheaper than renting costly physical office space.
Plan for a successful future by taking these points into account. Form your UK limited company today using Simple Formations for as little as £28.00. If you need any further guidance please get in touch.
