Entrepreneur's toolkit - an A to Z Guide - Part 1

   

This article was written by Alan Gleeson

Introduction

Starting a new business is a very exciting time – however, it is also very challenging. Luckily there is plenty of help at hand for those who are clever enough to look for it.

Did I say clever? Yes, I did, because many entrepreneurs charge headlong into their pet projects without giving due consideration to the resources available to them. While the energy levels for all entrepreneurs tend to be very high, it is important to step back, when appropriate, to ensure that the proper advice is being obtained.

For many people, a new business is like a boat sailing in uncharted territory. One can reduce the inherent uncertainty and risk with good advice, appropriate planning and a dollop of experience.

The following guide contains some advice and recommendations for those starting up in the UK. While not a ‘bootstrappers’ guide per se, the assumed audience are UK-based entrepreneurs looking to set up with fewer than five employees and limited funding at their disposal.

Where to Start?

Given that one area of particular interest for us is business planning, it seems like a very good place to start. You must resist all temptation to skip writing a business plan. Preparing a business plan is a vital first step on the journey of all entrepreneurs.

Sure, it may seem like a difficult proposition, especially if it’s the first time you have to write a business plan. However, the business planning process will really help you get a feel for the various elements that will determine your success, from cash flow, to sales forecasting to your personnel structure. You skip this critical process at your own peril.

Naturally, we recommend Business Plan Pro 11.0 (RRP £79.99) as the best means available to write a business plan. Business Plan Pro helps you to structure your business plan, is exhaustive (meaning you cover everything) and offers help at every step.

Alternative methods include writing the plan yourself, using products such as Microsoft Word and Excel, or paying someone to write it for you. Unfortunately, these other methods either leave you staring at a blank screen, or simply help you avoid thinking through the conceptual and financial issues critical to your business. Whatever method you choose, you will find more information on writing a business plan at our business plan site.

I cannot stress enough at this point the importance of getting advice. The great thing about starting a business is that there are lots of experts who may be blogging about their experiences or have written about the issues they faced and some of the hurdles they have overcome. Here are some of my personal tips for some key areas in getting started:

Accountant

Speak to an accountant early on in the process. They can help you decide the best legal structure for your business, explain VAT and also advise you on other financial obligations. Aims Accountants are a group of accountants that are scattered around the UK and are ideal for start-ups.

Accounts

You must get a grip on finances from day one – don’t assume it can be all outsourced to an accountant or bookkeeper. I would recommend taking a look at products such as Intuit’s QuickBooks or Sage 50 Accounts 2008.

The bottom line here is that certain things, such as cash-flow management, are often neglected by entrepreneurs. If you have to pay for things up front and only receive cash 30 days later you will have a potentially crippling financing gap. By ensuring you invoice promptly and manage accounts receivable/ debtors you will be in a better position to ride out any credit problems.

Antivirus Software

All computer users should have an antivirus package in place (at the very least) to protect against viruses, etc. Packages are available online and from stores such as Amazon and PC World. Market leaders include Norton and McAfee, but there are also good, lower-cost alternatives available such as AVG.

Bank Account

You will also need to open a business bank account. There are many different banks offering good opening offers for start-ups, so do your research. Naturally, it is vital that the bank is competitive and has a good online presence so you can manage your accounts online.

While you are researching bank account options, speak to them about other financial services products, such as company credit cards and merchant services (an ability to take credit card payments). Whatever you do, keep business expenses, costs and accounts completely separate from your personal ones.

Business Books

Looking for some books to help get you started? We recommend the Pearson range and also The Essential Business Guide. Business Plan Pro 11.0 includes Hurdle: The Book on Business Planning by Tim Berry free in PDF format.

Business Cards

Business cards can be easily ordered online from the likes of Vista Print. There is no reason not to be creative with the cards to try and help you stand out from the pack. A business card should contain the name of your company and contact information, at the very least, and once you get them printed be sure to carry sufficient quantities with you. The next step is to go networking and to attend events such as Growing your own Business to get your name and your card out there.

Broadband

Fast Internet connectivity is vital for any entrepreneur in the UK given the importance of the Internet for all businesses. Again, it's a case of shopping around to assess which provider will give you the best option for your circumstances. It is worth noting that the cost of broadband is related to the speed plus the download size, so it is important to consider your likely usage in light of these.

Data Backup

Given the extent to which your business will probably rely on computers, you should put a data backup system in place. There are two main options: remote backup to an online server, or backing up to an external hard drive. Again, there are pros and cons to both.

The cheaper option is probably to buy an external hard drive such as those offered by Maxtor. These come with a USB connection and you simply plug it in and back up the files to it (in essence you are just copying the files to another device).

If your business takes online orders or has any significant digital data needs, you will likely want the additional reliability and security of a remote, online automatic backup. There are a myriad of data backup providers out there. It is really a commodity offering, so either get a recommendation from someone or go with a lower cost provider.

Domain Names

A domain name is the name that people type into their Internet browser to get to your site; for example, you would type www.paloalto.co.uk to get to our main business plan site. Having a good domain name is an asset, and ideally it will positively represent your company or product name. After that, it is a case of deciding which countries you want to have websites for.

Most UK websites will end ‘.co.uk’ whereas in the U.S. ‘.com’ is the main domain suffix, properly called a 'Top-level domain'. You can order domain names in the UK from providers such as Net Benefit and Easily; again however, as it is a commodity offering, shop around for the prices and offerings you want.

Email for Website

Once you get a website up and running and are receiving traffic to it, you will need to manage email from the ‘Contact us’ page. While it is tempting to route email to an Outlook account on an individual computer, this has many drawbacks: it’s not accessible remotely, you may have uncoordinated customer responses, and what happens if that computer is down for whatever reason?

There are a number of new innovative solutions available that enable remote online access. We at Palo Alto Software were so dissatisfied with the email solutions we tried that we built our very own product! It is called Email Center Pro and there is a free trial available at the website.

Fax

Harnessing the power of the Internet means you do not have to invest in hardware, such as a fax machine, that you may use infrequently. Don’t waste your money buying a fax. Instead subscribe online to an electronic fax service from the likes of eFax.

The number of people sending faxes has declined significantly with the advent of email, but in some professions they remain an invaluable tool. Once you set up, be sure to sign up for the Facsimile Preference Service to ensure you are on the list of those not opting in for unsolicited faxes.

Free Stuff

All start-ups tend to be very careful with finance – after all, there are all these outgoings set against uncertain income. From a provider perspective, new businesses can offer a lifetime of purchasing so they are very attractive as customers. The key with all of this is to assess the nature of the competition in the industry from which you need to source products, and then to see whether the service provider is prepared to offer free trials, etc.

• You can read the second part of this 2-part article here.

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