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8 important factors to consider when starting up a business

Are you thinking about starting your own business? Feeling uncertain about the road ahead? You’re not alone!

Building a business from scratch can be scary, but our eight considerations below are a great starting point.

1. Have a brilliant idea

If there’s no outstanding, brilliant (practical) idea from the start then the business won’t fly. After all, no business can develop in the absence of a great idea and it’s the only thing that will allow it to develop. Furthermore, the marketplace may already be crowded so you’ll need something that stands out; that makes your business unique.

2. Analyse your competitors

What are your competitors up to? Do they have clear strategies and are they successful? Use this knowledge to make informed decisions about your business. It will also help you when devising an effective business strategy of your own.

3. Decide on your funding and budget

The next important factor involves money. You need to understand how much capital is required to set up and run your business, and where this funding will come from. It’s also essential to have a budget (to stick to).

4. Have a positive attitude

Starting up a business and taking it forward will be a rollercoaster ride - there will be many highs as well as risks and challenges. A positive, ‘can do’ attitude and a heathy dollop of optimism and flexibility goes a long way here.

5. Create a robust business plan

A lack of a business plan means your fledgling enterprise will struggle to develop. Writing one can assist you in determining if your idea is actually workable, and will provide direction in doing so. A business plan is like a map that tells you where to go next.

6. Obtain legal documentation

Whatever your business involves and whichever industry it’s in, there will always be legal factors to consider. For example, when selling certain products and services, there will be a requirement to draw up specific legal documents. Make sure you’ve done your homework and get the legal documentation done for your business in good time.

7. Ask for help when you need it

Rome wasn’t built in a day, as the saying goes. Building a business requires dedication, hard work and tenacity. There will always be questions and issues along the way, so you’ll likely need plenty of professional help. Make sure you have the necessary accountants, specialists and industry advisors on hand for when you need them.

8. Plan how you're going to grow your business

Growth is essential to the survival of your business long term. It helps enormously in acquiring assets, funding investments and attracting new staff. It also enhances business performance and profit, and may allow you to:

• Attract more customers
• Increase sales
• Expand your products and services
• Take advantage of new opportunities

Additionally, growth can really help when responding to market demand, increasing your market share and capitalising on your growing brand. Typically it will also spur on innovation, helping you to stand out in the market and keep your competition on their toes. It enhances your credibility too, allowing you to increase stability and profits and broaden your supply base.

Knowing how to grow

There are many facets to growing a business and it’s not a ‘one size fits all’ thing. You may start off wanting to expand your service area, but later on decide to form business partnerships, diversify your existing product line, launch new products or explore other business growth strategies.

Working out which growth opportunities are right for you will mean fully understanding how your business is performing at the moment. Evaluation and analysis in this way can help you spot any current weaknesses and challenges which could put an obstacle in the way of your growth plans.

But innovating and growing is expensive. Is there any help from the government at all?

The good news is yes, there is. There are two you may find useful in fact - one is R&D Grants and the other is R&D Tax Credits.

R&D grant funding sources include Innovate UK grants administered by the UK Government and the EU’s Horizon Europe scheme. R&D Grants work like a competition, where the best one will win the funding. However, applying for R&D grant funding can be difficult and time consuming. Grant funding is highly competitive and only the highest quality applications have any chance of success.

Award winning R&D grant applications successfully describe the technological, commercial and financial benefits of the project in an interesting, compelling and precise manner. The R&D work must look to resolve a technical or scientific uncertainty that involves carrying out innovative or risky research and development. R&D Grants are often given to projects that are deemed too risky for investment from the private sector.

You can find out more on our R&D Grants page.

Then there’s R&D Tax Credits

Every £1 that’s spent on R&D means roughly £7 of net economic benefit to the UK. It also unlocks £1.40 of private R&D investment, so it’s no wonder the government encourages growth.

R&D Tax Credits are an incentive designed to encourage innovation and increase the amount of spending UK companies make on R&D projects. It's one of the UK government's most popular incentives for investment in research, development and innovation, allowing up to 33.35% of a company's R&D spend to be recovered either as a reduction in Corporation Tax or as a cash payment.

Any company in any industry may be eligible for R&D Tax Credits. The key is that it must have undertaken development activities that aim to make an advancement in technology or science.

Relevant R&D work may include:

• Developing new products, services or processes
• Modifying or upgrading a product or service already in existence

Think R&D Tax Credits apply to you? You may well be right. Find out more on our R&D Tax Credits page.

Get in touch with the R&D experts

Tax Cloud is a cutting-edge, effective online portal designed to take the pain out of claiming R&D tax relief. Developed by the expert R&D tax team at Myriad Associates, there are separate sections for both businesses and accountants allowing you to make your own fully-supported claim.

Tax Cloud are specialists in all aspects of R&D tax relief assistance for UK companies. Made up of skilled accountants and tax experts, we have a proven track record in making successful R&D Tax Credit claims so you can rest assured you won’t miss out. If you think you may be eligible, contact us today on 0207 118 6045 or use our contact page. You could well be surprised at what you can claim.