Starting a business is hard work and involves financial risk and often entails leaving the security of employment.  If everything goes well then your own business can be immensely rewarding and satisfying.  There are many sources of information for those contemplating or in the process of starting a new business.

Starting a business has been likened to owning a boat, the best days being the day you take ownership, and the day you finally sell it.  We beg to differ: there is no equivalent to a boatyard to look after your business and leave you to get on with other things.

There are many ingredients needed for a successful business, and no one formula will work for everyone or in every sector.  We have reviewed all of the successful businesses that we have worked with over the last sixteen years and found a number of common characteristics.  The common factors of a successful business are:

1. Hard work and commitment:  The owners that put in the hours get their rewards in the long run.
2. Taking advice:  Successful business people accept that they are not experts in finance, taxation, legal matters or marketing.  The benefits of taking professional advice should always exceed the price paid.
3. Precision bookkeeping:  The best businesses are always up to date with accurate financial records properly reviewed at least on a monthly basis.
4. Markets:  There must be a market for your goods or services and an appreciable difference between you and your established competitors.
5. Quality:  Successful businesses usually deliver a good quality product at a fair price.
6. Customer focus:  The best small businesses are customer focused and ensure that responding to customers is the number one aim of the business.  Your main source of customers is likely to be personal recommendations rather than advertising.
7. Owners skills:  Successful small businesses are almost always founded on the skills, and more importantly the enthusiasm the owner has for the businesses particular trade sector.
8. A clear vision or plan of what you want to achieve:  This may include profits, growth, lifestyle, fulfilling your potential, more altruistic ends or any combination of these.  Many successful small businesses don’t try to grow large, but instead meet the needs of their owners very well.

The initial steps in starting your business are to established your business idea, decide that you can commit to running your own business and ensuring that your business will have all of the above success characteristics.

Having got this far the mechanics of starting a business are not complex.  You might want to draw up a basic checklist of tasks such as the following list:

1. Establish and research the business sector and specific trade of business.
2. Consider the likely growth of the business, including best and worst case scenarios, and decide if this will meet your needs.
3. Draw up a list of every piece of equipment, resource and other expenses that will be required at the start of the business.
4. Create a basic cash flow forecast.  This may be as simple as estimating sales, costs and your required personal drawings on a monthly basis.  It is possible that the business will not meet your financial requirements from day one, if so you need to consider what capital you can put into the business, what external finance you may require and what minimum growth is needed.
5. If you require premises and/or employees from day one then these must both be considered in detail.
6. Draw up a business plan.  This should briefly cover all aspects of your business.  It will certainly include products or services, marketing and financial information.
7. Create a detailed cash, profit and balance sheet monthly forecast.  This is important even if you do not require external finance (and is vital if you do).  The forecast will form part of your monthly financial review.
8. Limited company or self employed.  Decide if operating as a limited company or as self employed (sole trader or partnership) is right for you.
9. Decide on possible business names and research existing businesses with similar names.
10. Obtain and finalise finance arrangements.
11. Create your business structure:  this may include a limited company formation or a partnership agreement.
12. Research and take action to meet your insurance and legal requirements.
13. Obtain your basic trading and marketing materials including stationery and business cards.
14. Set up a business bank account.
15. Register with HM Revenue and Customs for corporation tax, self employment, national insurance, Pay As You Earn and VAT as applicable.  Registrations should be within the first few days of starting, there is no reason to delay.  Fines are imposed if you are not registered within 3 months.