Every year, more and more people across the UK decide to follow their dreams and set up their own business. In fact, 2014 was record breaking year for start-ups in the UK, with 581,173 new businesses being registered at Companies House – a 10 per cent increase from the previous year.
People from all walks of life make the decision to launch a new business venture for all manner of different reasons, whether that be to take control of their own destiny, follow a passion, or reap the full rewards of their hard work.
Regardless of what the reasons are for wanting to launch, proper planning is essential if entrepreneurs want any chance of making their dream a reality – as the old saying goes, “if you fail to prepare, prepare to fail.”
As well as an amazing idea, enthusiasm and determination, one thing you can’t launch a new business without is money. While some potential business owners may feel that their idea wouldn’t require much funding, start-up costs can soon add up. There are a lot of potential costs that need to be accounted for before launching a business, such as premises to operate out of, utilities, office supplies, marketing collateral, phone and internet access, business insurance, wages, travel and much more.
How can I get the money I need to start my business?
When it comes to getting the money needed to start a business, there are a variety of different finance options available. However, many entrepreneurs would prefer not to take out a large loan or other form of finance when setting up their business, preferring to seek out alternative ways of funding their venture.
Using personal savings to fund a business venture is not right for everyone – but for many, the absence of repayments impacting on cash flow and profits offers peace of mind.
How can I save the money I need?
Saving to start a business, or saving for any other reason, doesn’t have to be a daunting task. In fact, with a little determination and a proper plan in place, it can actually be fairly straightforward.
Setting up a personal savings account can be a good way of kick-starting this process. There are a range of different types of personal savings accounts available, each offering different rates and features, so it’s important to choose the one that’s right for you.
Investing a large amount of personal funds into a business idea isn’t without its risks, which is why it’s so important to have a proper plan in place. If you’ve made a list of all the costs that come with starting a business, you should have a target in mind for how much you need to save. Once you have this figure, you can start planning, looking at areas where you can cut back, reducing your outgoings and putting some money away each month.
There are some great tools available online to help you get your finances in order, as well as a variety of mobile apps designed to help you reach your financial goals.
What can I do to keep my costs down once I’m up and running?
In order to be able to set a realistic financial goal when saving for a business venture, it is vital that entrepreneurs have an understanding of how much it will take to keep their business running after its launch. This will allow them to save enough to keep them running in the early stages.
While running a business can be expensive, there are a number of things entrepreneurs can do to keep their forecasted costs as low as possible.
Many entrepreneurs will work from home and arrange to meet clients in local business ‘hubs’, cafes or hotel foyers, cutting down on property costs. Alternatively, some people will conduct meetings over Skype or other free online services, saving them time and money that would be spent on travel.
Another way business owners can keep costs down is by leasing any essential equipment they may need, rather than buying them outright. Instead of a large, one-off payment, leasing allows you to pay in smaller instalments over time, which can be worked into your ongoing budget.
Setting up a business website is an important step to take, but can be a cause for concern for some people. While there are individuals and businesses who can help you set up a website, if investing more money is an issue, there are a number of services available online that you can use to build your own. Open source platforms like WordPress allow you to keep control of your website and make any changes yourself, rather than having to pay somebody else.
Marketing is an essential element needed to help a business grow, but doesn’t need to involve a financial investment in the early days of a start-up. Maintaining a strong presence on social media sites like Facebook and Twitter is a great way to create some buzz, while attending local business and community events allows you to interact with potential customers on a face-to-face basis.
Once your business has started to take off this is where financial planning will stand you in good stead. Taking surplus cash flow and placing it in a business savings account can help businesses start building a rainy day fund which will offer a financial safety net in the future.
At Aldermore, we offer a number of personal savings accounts that can help make saving for a business straightforward and rewarding. Visit our personal savings page or get in touch with a member of our team to find out more.
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