How to turn your great business idea into action


Whether you’ve been working for someone else for years and grown tired of the same routine, or you’ve always had that entrepreneurial streak, becoming your own boss may now be on the cards. At the start of the year, it was reported that 65% of UK workers would like to start their own business in 2020, showing how fast the desire for independent earning is growing.

The COVID-19 lockdown may have only bolstered this further, with the time at home causing many to rethink their current situations, take up new hobbies and explore alternative ways of making a living, putting their plans into place at last.

To start your own enterprise, you first need to come up with some good business ideas that are unique, fill a market gap and, of course, are profitable. Your passions and expertise are a good starting point, since you’ll know what it takes to succeed and be willing to put the hours in.

In the early days, running a business from home won’t always be easy and there will be many long days and nights required to put the essential groundwork in place. However, it can offer a fulfilling and flexible working life when done correctly.

With plenty of business software tools available, it’s easier than ever to get up and running with just a laptop, a desk and a lightbulb business idea.

So, what do you need to do to turn your great business idea into action?

 

E-commerce 

The opportunities for an e-commerce business are far and wide-ranging and most simply, involves selling products via an online platform. For this, you’ll need a good website and an e-commerce system to manage stock, customer relations, delivery and more – as well as the product you’re selling. Some e-commerce businesses start by growing their customer base locally, then with clever use of social media marketing and a niche product, which they then scale up across the UK, and even to other countries.

The possibilities for this are endless – whether you’re an avid crafter making homemade gifts or working with third-party suppliers to sell clothes.

What’s more, choosing to sell your product online rather than investing in a physical retail unit could future-proof your business. It’s expected that 27.5% of total retail sales this year will be from e-commerce, growing to one third by 2024.

 

Apps

Rather than e-commerce, which largely focuses on products, an app offers services to the consumer. According to App Annie, mobile app usage surged 25% YoY in Q3 2020, this high demand for apps makes for a valuable but competitive market.

As a starting point, you need to find a solution to a common problem even if people don’t know they need it yet. Digital.com outlines how you can turn your ideas into a successful app.

 

Subscription services 

Due to the rise of working from home, and also the growth of e-commerce, subscription boxes are soaring in popularity. Some models such as Bloom and Wild or Glossy Box offer ‘pick me ups’ in the form of a regular treat and are often used as gifts, while others including Dollar Shave Club are more practical and keep customers well stocked of the things they need most.

People in Britain spend over £2 billion every year on subscription services, with an average monthly spend of £14, and its success is predicted to grow. With online distribution, it means there’s lots of opportunity to find a niche, unexplored market and create the perfect box for those customers.

 

How to evaluate your business idea

Having explored a handful of small business ideas and chosen the one that suits your career goals and skill-set, there’s still a bit of work to do before taking the plunge and registering the company. Beyond the initial idea, it’s time to drill down and ask yourself a few questions to evaluate your business, your commitment to it and its potential for future success.

Question 1: Am I passionate about it?

Owning and running a small business will soon become a large part of your life, so it’s important to pick an idea that will give you the drive to push it forward, even on the harder days.

Question 2: Am I capable of doing it?

This might go without saying, but you need to be an expert in whatever service or product you’re offering. If not, the knowledge gaps will soon become apparent as you take it to market and your customer confidence will drop, as well as your own.

Question 3: Can I make a strong elevator pitch about my idea?

An elevator pitch is a short statement that describes clearly the vision, goals and purpose of your business – named so, because you should be able to put your idea across successfully to strangers in a short elevator ride!

If you can’t summarise this in a few sentences in a way that no-one close to the idea can understand, then it’s time to have a deeper think about your plan and how you can focus it further.

Question 4: Who will want to use my business?

Define the group of people who need your products / services. Once you have a clear understanding of your audience, you’ll be able to start forming plans about how you will market your business to them.

Question 5: Is it profitable?

Of course, running a business you’re passionate about is key, but if it doesn’t make any money then it won’t be long before you’re back working for someone else again. As well as identifying a customer base, having a basic understanding of the costs involved in the running of it, and comparing it to your budget, will help to evaluate the true profitability of your idea.

 

Top tips for launching your own business

Choosing your idea is just one part of the larger preparations that take place before taking the first step to self-employment. Here are some top tips to help see your business idea make its way from your head, and into your wallet.

 

Tip 1: Know your business and its market

We’ve touched upon this earlier, but beyond the initial brainstorming stages it’s important to get a solid understanding of your business’ market, audience and competitors. Getting feedback from friends and family is a good place to start, but commissioning professional market research, or employing an expert could help to build some key foundations for future success.

You’ll need to know who your competitors are, why your audience currently uses them and where they might be falling short, so you can offer the perfect solution within an existing market.

Beyond the initial business launch, it’s also a good idea to think about how it could grow, to enable forward forecasting. For example, if you started a dog grooming business, would you then expand to sell animal food and accessories? Or maybe you could develop and launch your own products to sell, under that brand name. Trialing this early on helps you to understand its longer-term vision, from the start.

 

Tip 2: Name and structure your company

Now you’re ready to register your company so first, you’ll need to decide on a name. Though it’s a fun task, this might be one of the most important steps for setting up your own business. But that doesn’t mean you need to overcomplicate things – sometimes a simple name will be much more effective than a pun or ‘clever’ play on words (which could come across as cheesy or unprofessional). Armed with knowledge of your audience, spend time choosing something suitable and again, call upon your friends and family for feedback.

Then you’ll need to decide upon the structure of your company, which is crucial for legal and tax purposes. There are a few options ranging from a sole trader to a limited company, each of which have their own legal and financial considerations. Always get advice from an accountant or solicitor on the best option for you, but it’s good to start the professional conversations with a basic understanding.

 

Tip 3: Secure funding

When starting your own business, you’ll need a budget and some sort of funding. Even if starting your business from home, costs such as buying a website domain, outsourcing technical work, marketing your company and designing your brand will all start to add up.

Luckily, there are a number of Government loans or traditional business loans that are available. Tools such as business loan calculators are useful when considering these options to see how much you could secure.

To help, ensuring you have a good business credit score at all times also means that more opportunities will be available to you throughout your entrepreneurial journey.

 

Tip 4: Build the brand

Once you have your name, you can start to build up your brand and its assets around it, creating a fully-fledged company and finding potential customers. Depending on your budget, you could hire a design specialist or if not, spend time learning how to use the many online digital design tools that are available.

In preparation for your launch, you’ll also need to start marketing the company. Specific methods will differ depending on your target audience, but getting to grips with social media and building an online presence is essential.

 

Tip 5: Launch it into the world

Once you’re happy with your brand and product, and you have a structure in place, it’s time to start finding customers. Pick a date and use your marketing techniques to build up a buzz ahead of your launch – enlisting the help of friends, family or even local influencers can help to spread the word and gain you some followers in the initial stages. Don’t be afraid to use tools such as LinkedIn either to speak to previous customers and other professional connections, and share the details of your new venture.

A key priority is maintaining positive cash flow, particularly when you are just starting out and every penny counts. As well as building up your own business credit rating, tools such as Experian Business Express allow you to run credit checks and monitor any company you work with, so you can spot signs of trouble early on and make informed decisions.

Building your own business from scratch might seem daunting but by following the steps we outline above, you should be able to take your big idea to market – and enjoy all the rewards this brings.

 

Find out how My Business Profile could help you track and improve your own business credit score.