Top tips when starting a new business
Having taken the plunge, the reality of being a business owner can often be a daunting one. Start-up entrepreneurs often find themselves having to be knowledgeable in areas such as HR, law, and accounting.
The decisions made at this point can have ramifications later down the line and be difficult to reverse. We have compiled our top considerations for new businesses.
At the outset, it is important to understand the various structuring options and make an informed choice about which best suits your plans in both the short and long term. To be able to do this effectively it is important to understand what is available and the pros and cons of each. More importantly, it is important to have a clear idea of where you ultimately see your business going.
2. Limited liability
This is an important factor to consider when setting up or registering a new business. The nature of the activities you are undertaking will impact just how important. If you’re unsure, consider speaking to an expert or outsourcing for company secretarial support.
Perhaps the most complex of all taxes, this subject could warrant a whole raft of articles on its own. At the outset, it is important to understand the VAT rules that impact your business and plan for them accordingly. From pricing to operational support, ensuring that you are compliant can impact your plans.
4. Cashflow impact of direct and indirect taxes
Irrelevant of your structuring it is important to understand the cashflow impacts of all taxes you and your business are liable to. These should be built into your business plans and cash flow projections to prevent nasty surprises.
5. Advice from the right advisors
If you have a toothache you wouldn’t want to see an optician. The same logic applies to choosing the professional advisors that you seek advice from, whatever field you are looking at. The specialisms of any professional service are wide-ranging, and it is important to make sure that you work with an advisor who is aligned with your requirements.
6. Compliance timeline
Starting and running a business is hard work, whilst compliance with statutory filings shouldn’t draw too much of your focus, it is important to understand when these filings fall due and work to tackle them in good time.
7. Accounting system and record-keeping
The range of accounting and bookkeeping systems is constantly expanding, with technology improving the efficiency of these systems through cloud-based solutions and features such as automatic bank feeds. It is important to choose accounting software that you feel comfortable with and is appropriate for the transactions of your business. More importantly, you should have a system in place that gives you the necessary insights into your finances.
8. Working capital management
Cash is king for every business, even more so for an early-stage business. Understanding your requirements and managing the influencing factors will aid your business in staying cash positive.
It is important to set financial targets for your business and even more important to review against performance and investigate variances. The data doesn’t provide the answers, but it can help you ask the right questions.
If you would like to discuss the above or find out more please do not hesitate to contact us today. Or to see how we can help you and your business, see our business advisory page here.