Budding entrepreneurs – how to make the most of 2010

As a rather turbulent 2009 draws to a close, entrepreneurial spirit is still very much alive. A third of British people want or have already started their own business according to recent YouGov research. The results show that while Brits are keen to get in the driving seat, the recession has had a damaging effect on entrepreneurial confidence. In comparison to this time last year, 50 percent of respondents agreed that now is a worse time to set up a new business and around 40 percent of those that do want to set up their own business blame the recession for delaying their plans.

Any company who has existed through the past 18 months will understand the real challenges businesses can face, and know the level of determination, commitment and drive that is required to keep a business going having experienced one of the biggest recessions since the 1930’s. However, those with such experience or that have built their business in more challenging times are often considerably more efficient, leaner, and better equipped to compete.

Catherine Harrell, Small Business Specialist at Intuit UK, shares some of top tips for prospective entrepreneurs on setting up your business and making it successful as we enter 2010.

Write your business plan out

It’s all very well having a brilliant idea, but without a plan, it’s going to be tough to turn that brilliant idea into a viable business. Make sure you know what it is you want to achieve and spell out plainly how you are going to get there. This will help you prioritize your efforts, ensuring you focus on the most important tasks first. In addition, this will make it easier to secure necessary buy-in and investment for the business. Your plan should not only lay out your business idea, but explain how you plan to attract customers to your business, as well as what your contingency plans are for when things go off track or in unexpected circumstances.

Find out more in our dedicated business plans section.

Create some hype

A big challenge for new businesses is getting word out about your great new product or service. This can be achieved by simply telling as many people as possible about your company as word-of-mouth endorsement is one of the most powerful tools. Try and saturate all the marketing channels and get your company online. A website that details your offering with contact details is a cost-effective method of making sure you’re reachable. In addition exploit social media avenues – this is a growing segment of the market and can be easily rolled out. Twitter and Facebook are two social media platforms you can start with.

Cash is king

The biggest cause of business failure is lack of money – it’s heartbreaking when great businesses go under simply due to a lack of readily available cash. Having awareness of all the outgoings and incomings is highly important. It’s likely that at some point in the life of your business, you’re going to need external funding. Whether you’re approaching a bank or your friends and family, they will want to be able to see the return on their investment, so being able to demonstrate transparency of your accounts backed up by a strong business plan will be crucial. It is necessary to get on top of bookkeeping right from the start, invest time and money in a smart solution and capable people.

Meet you customer’s needs

Do your homework and don’t assume you know the market inside out. Talk to your customers to understand their unmet needs. For example, consumers’ shopping habits have changed significantly: customers want to be able to browse online and compare prices before purchasing to get the best deal. This type of consideration will put new businesses in a better position to take a larger share of the market.

Make timely payments

Another easy hole to fall in is late or delayed payments. One way to encourage timely payment from customers is to agree payment terms in advance so it’s clear for both parties. Don’t assume that the business will be paid on 30 days or end of month following; set out terms in writing and try to obtain written acceptance. Printing the payment terms on easy-to-understand invoices that go out on time can also help prompt debtors to pay, as will the clear setting out of penalties if a payment is late.

Find out more in Bytestart’s dedicated credit control section.

Be ready for the upturn

It’s inevitable that the recession will end and few are already predicting 2010 will be the start of better things to come. When the economy does change, you need to make sure your business is front of mind and hasn’t got lost in all the doom and gloom. Entrepreneurs need to remember to profile their brand so it’s clearly visible to potential customers, so when their pockets do get bigger and deeper the cash is coming your way!

Finally, while it’s highly encouraging that so many people are keen to set up their own business, failure to plan could result in you paying the price later. There is lots of advice and support out there for prospective entrepreneurs. For more information and top tips, visit www.smallbizmatters.co.uk

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