It is a sobering statistic that one in five new startup businesses in the UK will fail in their first year of operation. There are a wide range of reasons for this, but key factors include not having enough funding to get the business off the ground successfully and not fully appreciating the needs and wants of their intended target market.
For many entrepreneurs, the first year of trading can be one of the hardest as every startup business looks to attract a growing client base and secure repeat custom. This article explains three ways in which UK startup firms can aim to be the four out of five businesses that survive their first year and go on to flourish with increasing revenue streams.
1. Write a Comprehensive Business Plan
Before any money is committed to a startup business, there must be the creation of a thoroughly researched business plan. This should include accurate financial projections for the first five years of the business, along with a detailed breakdown of the product or service that will be offered.
The target market for the customer base should be identified, along with research on key competitors and the proportion of market share that it aims to gain in the early years of operation.
It is a fact that a professionally written and thoroughly researched business plan can form a vital part of the direction of a company. One key way it is often used is to form the basis of discussions with lending institutions such as banks and third-party financiers to successfully secure outside capital to allow the business to get up and running.
In short, a comprehensive business plan should be considered an essential document that steers the business from its inception. For more information on how to write the perfect business plan for your startup company, see here.
2. Seek out Funding and Financing Options
One of the biggest challenges for any startup business is securing enough funding to cover initial costs and sustain operations during the difficult first year. For this reason, entrepreneurs need to explore and learn more all available options for financing.
Traditional sources of funding include bank loans, grants, and investments from friends and family. However, in today’s digital age, there are also many alternative financing options available such as crowdfunding and peer-to-peer lending.
Another option to consider is big rig lending. This type of financing specializes in providing loans specifically for trucking businesses, helping them purchase or upgrade their equipment. It can be a great solution for startup trucking companies looking to get off the ground with reliable vehicles. Take some time to read about big rig lending and see if it could be a viable option for your startup trucking business. Check out different lenders and compare their rates and terms before making a decision.
The key is to research and explore all available options to secure the necessary funding for your startup business. It may also be beneficial to seek guidance from financial advisors or business mentors who can provide valuable insight and advice on the best financing options for your specific company.
3. Hire the Right Staff
It’s imperative to ensure that the founding team of staff members in your startup business are as committed to the project as you are. Having loyal, intelligent, and highly motivated team members can make the difference between early success or a quick business failure.
It’s important for the team culture to be one that promotes open and honest communication. Some of the early decisions such as how to use sources of funding and final design elements of the product or service you will offer your target market can be huge and crucial turning points that shape the success of your venture in the early years of trading.
Put simply, it is vital to surround yourself with knowledgeable and committed team players.
4. Invest in Physical Premises
Whilst the planning stages of a startup do not require premises and are often done from the owner’s home office, once the business starts trading, it’s vital to have a professional office premises. This acts as a HQ for your business and allows your growing team to collaborate effectively and build the culture of the organisation.
Having a managed office building such as those offered by theworkstation.co.uk also lends a high level of credibility to your business. New customers and clients will want to trade with a firm that operates from a professional location, rather than from a back office in the family home.
Once sufficient revenue streams become active, and the team is more than just the business owner, it’s a good time to consider investing in physical premises to allow your business to flourish.
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