Though the UK economy is now hopefully recovering from the recession and employers are starting to recruit again, there are still many people out there who have taken the plunge into starting up their own business.
Whether it’s because of actual redundancy, or simply the fear of losing their job, the idea of ‘being my own boss’ has appealed to many. But simply having a great idea for a product or service isn’t enough to guarantee success. Here at Michael Bell & Co chartered accountants, we urge you to draw up a solid business plan well before you start writing that resignation letter or booking an appointment at the bank!
How do I write a business plan?
Your business plan is an estimate of all the different costs involved in starting up a new business. This includes raising funds for a new business, your new business start-up costs and looking at overheads and the working capital and personal income you’ll need. As chartered accountants in Yorkshire, we can offer expert help in writing a business plan, but here are the things to consider:
• You’ll need to estimate the direct and indirect costs of running your own business, including the money you’ll need for personal survival
• You’ll need to estimate the income your business will generate
• You’ll need to have a contingency plan to handle any changes in your sales and costs forecast
• You’ll need to have a solid idea of how you are going to fund a new business start-up – will you need to borrow from a bank, use your own savings or get help from family and friends?
• You’ll need to take into account the costs of repaying new business loans
• You’ll also need to identify any personal assets – such as property – that you can offer as security against any loans
• You’ll need to draw up your own personal survival budget – the money you’ll need for everyday living expenses
When you’ve worked out your new business start-up costs and added a 25% contingency, compare these costs against your sales forecasts. If your costs are going to exceed income, it might be time to go back to the drawing board with your new business idea!
For help and advice in drawing up a business plan, please contact us.