As a sole trader planning to start multiple businesses, what are the key things that I need to be aware of ?
If you’re planning to launch a new business, a crucial consideration is whether you have enough funds to make your idea a reality. You should assess the costs involved in starting your business to evaluate its feasibility, as costs vary depending on the sector and location. For instance, setting up a physical food store would be more expensive than an eCommerce store and less costly than starting a freelance marketing consultancy.
It’s crucial to keep an eye on your small business finances to avoid unexpected expenses, which are a common reason for business failure. On average, around 42% of UK businesses launched are still operational five years later, highlighting the importance of having sufficient funds and proper guidance for your start-up.
If you cannot self-fund your venture, explore various funding options to ensure your business idea is financially viable in the long run. According to recent research from the Daily Telegraph, the average UK start-up spends around £22,756 in its first year, including
legal costs £6,259,
accountancy fees £3,937,
HR costs £4,518,
and company formation expenses (£5,518).
While this figure may have changed slightly in recent years, it provides a useful breakdown of typical start-up expenses.
After going through this article, if you are interested in starting your own business, there are some low-cost ideas you could launch from home. With no need to worry about premises costs, reduced commuting expenses, and most computer hardware already at your disposal, you could easily get one of these businesses up and running in no time:
Baking from home
Gardening and landscaping
Incorpration, Business Pramises & Insurance
If you opt to set up a limited company, you can do so at a reasonably low cost through Companies House. However, most people choose to use an intermediary firm to complete the necessary paperwork, which could start at around £15. If you require additional services, such as a registered office or company secretary, the cost may increase by several hundred pounds.
If you need business premises, you’ll need to find a suitable location or lease an office from a commercial landlord. Some commercial leases operate on a quarterly rather than monthly basis, which can result in a hefty bill every three months. This is particularly true for retail outlets, and it’s important to incorporate this expense into your business pl…
Stock & Hardware
That’s correct. When starting a business in the food, fashion, gardening, or homeware industry, having a reliable and steady supply of stock is essential for the success of the business. Suppliers often offer credit terms that can help with cash flow during the early stages of the business. However, it’s important to shop around and compare prices to get the best deals on supplies.
In addition to stock, tools and equipment are necessary expenses that cannot be avoided. For example, in the food industry, kitchen equipment and utensils are essential for preparing and serving food. In fashion, sewing machines, fabrics, and other materials are required to create clothing items. In gardening, tools such as shovels, rakes, and pruning shears are necessary to maintain a garden. And in homeware, equipment such as a point-of-sale system, display cases, and shelving units are needed to display and sell products.
It’s important to consider the quality of the tools and equipment purchased, as buying cheap equipment may lead to more expenses in the long run due to repairs and replacements. It’s also recommended to purchase from reputable suppliers that offer warranties and customer support.
Overall, when starting a business in any industry, it’s important to carefully consider and budget for the necessary expenses, such as stock and equipment, to ensure the success and sustainability of the business.
business set up costs
Start-up costs will vary from business to business – here is a helpful checklist:
IT, cloud, and computer hardware
Business stationery and office supplies.
Internet and phone set up and charged.
National Insurance and pension contributions.
In conclusion, starting a new business can be a life-changing experience, but it requires careful planning, budgeting, and execution to succeed. From setting a clear vision and goals to choosing the right company structure and accounting methods, there are several key steps involved in launching a new business.
It’s important to remember that business expenses go beyond just the initial start-up costs, and it’s essential to plan for ongoing fixed and variable costs and unexpected obstacles. Seizing every opportunity to cut costs and understanding your financial performance are critical to long-term success.
At ChatGPT, we are committed to helping new start-up businesses succeed. If you have a great commercial idea and vision, we are here to help you every step of the way, so feel free to share your ideas with Direct Assist – Chartered Certified Accountants. With the right strategy and guidance, you can turn your dreams into a successful and thriving business.