You’ve done the business plan, raised the funds you need, have your customers lined up and you are ready to go.
Amongst the many things on your plate, the following 5 key tips are essential to keep your business on the right track.
1. Choose a good accountant
Get recommendations from friends, family and other business people you know. Always meet the accountant who will deal with you and make sure the size of the firm matches your business, you won’t get attention from a large firm that will delegate juniors to deal with you. For a small business, a small accounting practice with one or two partners would be ideal. You can also get a list of accountants in your area from the Institute of Chartered Accountants at www.icaewfirms.co.uk
Your accountant can help with setting up your new company but do look at www.companieshouse.gov.uk There are also several online sites that will set up your company for £200-£300.
2. Keep accurate accounting records
Get your accountant to recommend a good accounting system and ensure all your transactions are recorded accurately and on a timely basis. This is one of the most common mistakes businesses make. You won’t be able to track progress if your records are weeks or months behind and it becomes difficult to predict cash flows.
One of the inexpensive and easy ‘to use’ systems I use with clients is ‘Quickbooks’ from Intuit – www.intuit.co.uk Its usually about £200-£300 depending on whether you use payroll and you can get it on Amazon, without the more expensive monthly subscription from Intuit. You should outsource your payroll anyway and your accountant should be able to do that.
3. Keep the taxman happy
You have to register with HMRC for PAYE if you have staff, charge VAT if your sales are over the minimum annual limit and pay corporation tax on the profits you business will make, www.hmrc.gov.uk/startingup is useful to start with.
All the reporting and payments for HMRC is now dealt with online and your accountant should guide you through all this. You must pay what’s due to the government and file the reports required on time.
4. Manage your cash
Keeping the cash flowing is vital and you need to keep track of all your outstanding debts from customers and liabilities to your suppliers accurately and this where a good up to date accounting system helps.
Even the most successful businesses go bust when they don’t manage their cash flows effectively. Make sure you don’t extend too much time to you customers to pay since suppliers will not usually wait and neither will HMRC. You should prepare cash flow forecasts on a four to eight weekly basis so that you can anticipate issues.
5. Do the business
Most of the stuff described above should be outsourced to experts. You should focus on marketing and selling your service or product, which is why you started in the first place and have more time to set up a successful business.