A Modern Day Guide For Online Success
We haven’t met, but we probably know your distant business dreams especially if you want to know How to Start Your Own Business.
You’re not looking to take over the world, or grow into a multi-million-pound company. You want to be master of youruniverse, rock yourown world – eventually earning a sizeable income that frees you from worry over money and makes a far-flung holiday each season more than feasible.
You may have already taken that scary leap, and are suffering from a bad case of marketing overwhelm. Or you could have a napkin idea that you’re sure will work (but are confused as to just how to make it happen).
This start-up strategy is going to walk you through the process – from validating that your idea has legs, to tapping into the power of technology to drive business growth.
We’ll cover company structure, how to create a website that rocks, why you may want to outsource (as well as why you may not), and how certain software should be your best friend.
All of which will be served up in the form of actionable steps that you can take here and now (you’ll not find any fluffy, jargon-laden advice here!).
So, that’s you, that’s this book, now we’d better get to work into transforming your idea into a rock solid (and profitable) reality…
Ideation – A seed of an idea
How to uncover a profitable idea you’re passionate about
This section is for those readers out there who are still unsure about whether there is a need for their idea (or who are determined to become their own boss, but need to discover an idea that they’re passionate about).
It’s a well-worn and incredibly depressing fact that 50% of all new businesses go under in the first 12 months. With 500,000 businesses started each month, that’s a staggering 3 million start-ups that fail each and every year.
Look around you – online, in everyday life, as you speak to friends and family – what common problems do you encounter with no obvious solution? Train your mind to spot every area of opportunity – look at issues faced in your day job, discover problems with existing products ,and uncover issues through networking.
“I’ve seen people find business ideas as a spin from their current job, from a hobby or simply from a moment where they were frustrated and thought something could be improved. If you really want a business idea and don’t know where to start, try to come up with one business idea each day for a month and see if you can train your mind to identify areas of opportunity.”
— Adam Broetje, CEO, Odd Dog Media
Step 2: Start Making Lists of Problems that Need Solving
With the opportunity identified,it’s time to dig into the details of the problems that are being faced. You could check business forums (if selling B2B) or niche social sites (if selling B2C) to gain insight into your possible target market and their frustrations.
Step 3: Come Up with Possible Solutions
With the many problems listed, it’s time to create potential solutions. Collaboration can really help here – someone to bounce ideas off can prove invaluable for developing your thoughts. Manage your Time Wisely
Step 4: Filter by What You’re Passionate About
Starting and growing a business takes dedication and persistence. You have to be passionate about it. If you get to this stage and find that you’re simply not feeling this problem, this solution, this target market, don’t be afraid to start all over again. Or, if you have plenty of passion but no technical knowledge to take the idea to market, consider finding a partner who is equally as passionate, with the right technical know-how.
Step 5: Narrow Your Ideas Down to One
Now you get to it – a list of problems (and solutions) you think have legs. Time to validate. You could:
- Test out the idea on a crowdfunding site – is there engagement? Are you getting hits?
- Create landing pages and advertise online – are people converting? Or even clicking through? (we run through tools that can help with this in the very last chapter).
- Ask friends, family and colleagues for feedback – ell them to be brutally honest.
- Use a market research survey site to test out consumer opinion – there are plenty of free survey websites out there, as well as market research-based sites that’ll send your survey out to suitable people (at a cost).
Key question: “Do I need a business plan?”
Even the savviest of entrepreneurs can see a business plan as a formality, only needed by those seeking investment, when in fact ALL business owners should have one.
A business plan should detail your business goals and outline a detailed plan as to how you’ll achieve them – think of it as a Plan of Action – keeping your attention focused on what should be done and when.
A business plan is a working document – it should develop, grow and change over time. It should summarise:
✓The customer you’re focusing on
✓How your business is going to meet their need/problem and how you’ll make a profit in the process
Activity – Elevator pitch
⏱ 60 seconds max
This is it – your elevator pitch. You have one minute to create a short and seriously snappy explanation as to what your business does. Think of it as a sales pitch in 25 words or less.
It should include:
✓The problem that your business solves
✓How, exactly, your business solves this problem
Different Business Models
There are two core forms of business models to consider: sole-trader and a limited company. Here’s a quick side by side comparison of the two…
|Sole trader||Limited company|
|You register as a sole trader and have a Unique Tax Payer Reference||You will register the Company at Companies House|
|You work as an individual and are fully responsible for the business||The business finances are entirely separate to your personal finances|
|You must pay income tax on any profits||The Company must pay corporation tax|
|You can employ staff||The Company is legally separate from yourself – you are the Director and an employee of the Company|
|You pay your own national insurance||The Company pays National Insurance and income tax|
|You are personally held responsible for any losses suffered||It is the business (not you personally) that is liable for business losses|
|You’ll need to complete an annual self-assessment||You will file Annual Reports with
! You must research business models in-depth in order to make the best decision – you may also want to seek advice from qualified professionals, such as an accountant or solicitor !
How to Start Your Own Business : Monetisation – Money, money, money
Here’s a question for you – How will you make money? Simple, right? Yet it’s something that is so often overlooked by the average fledgling start-up.
After researching and validating your idea and pinning down your business model, understanding the wain which you’ll sell and drive revenue is the next step.
The five core groups of money-making models are:
- Advertising space base
- Agency base
- License/subscription base
- Lifestyle base
- Data base
Let’s take a look at each in a little more detail…
Advertising space base
Most suited for: Content-focused sites, news magazines, mobile games
Method of monetisation: Banner ads, affiliate marketing, sponsored content, ad-free experiences
Most suited for: Marketplaces that connect buyers with sellers
Method of monetisation: Commission, subscription fees, pay to be promoted/featured, pay to post such as Fiverr.
Most suited for: Saas/software and B2B products services
Method of monetisation: Freemium, Pay per user (suited to team apps and platforms), Pay per license, pay per device, Expert help upgrades
Most suited for: Big brands and large online communities
Method of monetisation: Branded/lifestyle merchandise, direct to consumer premium products
Most suited for: Huge user bases – from large ecommerce to heavy-content sites
Method of monetisation: Sell data (e.g. email lists), access to data for analysis
Activity – Weighing up the competition
In order to be competitive, you need to understand the competition on a deep level. Then and only then can you shape your offering and pitch yourself so youl engage in ways others don’t.
⏱ 30 Minutes
✓Identify your competitors – both direct (those selling similar products or services) and indirect (those selling alternative products or services that still solve the same problem)
✓Create a table detailing their price point(s), quality level and location
How to Start Your Own Business :Legal Set Up – Dotting the I’s, crossing the t’s
Urgh – here comes the small print and intimidating legal stuff. The following sections aren’t as fun as developing a light bulb idea or taking aim at the completion, but they are essential.
Here we look at how you can protect your business with insurances, and what taxes and charges you’re liable for.
If you’re based out in the real world – with a service carried out in person or a bricks and mortar store, you need public liability insurance. This form of policy protects you if someone, or their property, is injured or damaged as a result of your business. In some instances, such as service-based businesses, potential clients may ask to see your public liability insurance certificate prior to using your services.
Sell physical products? It may be worth purchasing product liability, which protects you in the event someone is injured as a result of using your product.
If you’re bringing employees on board, whether as a sole-trader or limited company, employers’ liability will ensure that your business and employees are protected if they become sick or injured on the job. This form of insurance is legally required, even if you only employ a single person.
Plan to offer professional advice? Such as business consultancy, legal services or logistics advice? Professional indemnity will protect your business from detrimental outcomes that may come from your clients taking your advice.
If your business is operating from premises then you may want to plan ahead for accidents that could cause building or stock damage.
Key man insurance is a type of life and critical illness policy – protecting your business from the prospect of a key person dying or becoming sick.
How to Start Your Own Business : Taxes and Charges
The only thing certain in business life is taxation – here are the taxes and charges that you’ll need to prepare for (and build into your cash flow forecasts and financials).
Corporation Tax applies to limited companies. Following registering with Companies House, you’ll then need to register separately for corporation tax. Here are the figures…
|Small profits rate
(companies with profits under £300,000)
(companies with profits over £300,000)
|Main rate (all profits except ring fence profits)||19%||19%||20%||20%||–|
|Marginal Relief lower limit||–||–||–||–||£300,000|
|Marginal Relief upper limit||–||–||–||–||£1,500,000|
|Special rate for unit trusts and open-ended
Pay As You Earn (PAYE)
If you employ one or more people, you’ll pay income tax and National Insurance on their behalf via a system called PAYE.
If you’re self-employed and earn more than a set amount in any one tax year you’ll need to pay National Insurance. There are two types of National Insurance for the self-employed:
- Class 2 if your profits apply if you earn £6,205 or more a year
- A Class 4 if your profits apply if you earn £8,424 or more a year
|Class||Rate for tax year 2018 to 2019|
|Class 2||£2.95 a week|
|Class 4||9% on profits between £8,424 and £46,350
2% on profits over £46,350
If you’re a sole trader with no employees, you’ll pay your income tax along with your self-assessment (the deadline for which is the 31stof January each year – paid a year in arrears).
|Band||Taxable income||Tax rate|
|Personal Allowance||Up to £11,850||0%|
|Basic rate||£11,851 to £46,350||20%|
|Higher rate||£46,351 to £150,000||40%|
|Additional rate||over £150,000||45%|
Capital Gains Tax
Capital Gains Tax is paid on the profits made when a business asset is sold. For example – you purchase a chair for £50 and sell it for £150, you’re then taxed on the gain made (e.g. £100).
If your business turns over more than £85,000 you’ll need to register for VAT.
|Rate||% of VAT||What the rate applies to|
|Standard||20%||Most goods and services|
|Reduced rate||5%||Some goods and services, eg children’s car seats and home energy|
|Zero rate||0%||Zero-rated goods and services, eg most food and children’s clothes|
Activity – Calculate your sales forecast
The success of your business relies on you getting to grips with your financials – not only the cash flow of your business for it to thrive, but also the essential income you’ll need in order to personally survive. So take a moment, grab a quiet seat and open up the included spreadsheets to crunch the numbers.
⏱ 2 Hours
The Golden Rules for getting your Sales Forecast right
The net Cash Flow of your business = Total Income – Total expenditure
– Remember – Income is defined as money received and cost is the amount of money required to produce your product/service
- Plan ahead – consider possible scenarios of things not going to plan (and how this could impact your cash flow)
- Factor in your fixed costs (such as rent, hosting and salaries) as well as variable costs (costs that increase in line with how much you produce)
– Think about how sales may differ from season to season – almost all businesses experience quiet times
!!! Sales Forecast Essentials – Your cash flow is going to be entwined with your sales forecast !!!
Here’s the rundown on setting realistic expectations when it comes to sales…
– Think about the various channels that you’ll sell through – online, in-store and on marketplaces – how will the profit and effort differ for each?
- Planning on selling more than one product or service? How will your forecasted sales fifer for each? Consider price, sales channel, availability and customer want or need.
– Have you tested the market for demand? Whether car boot, landing page or pop-up shop, this part’s pretty important for ensuring that your figures are realistic and your price is on-point.
Outsourcing and Task Management – Managing time and getting things done (like a pro)
The freelance industry is booming. Today, with technology on your side, you can reach out to a wealth of skillsets from professionals all around the world in a matter of minutes. Freelance websites not only make finding this talent easy and fast, but it also offers the reassurance that your money is held in escrow until you’re happy with the outcome of the job. Let’s take a look at some of the world’s most popular freelance websites…
The UK’s biggest marketplace and considered to offer higher quality freelancers than many other sites (albeit at slightly higher rates). You can either post your own job and invite freelance applicants, or buy pre-packaged services (known as ‘Hourlies’).
Great for small, fast gigs (similar to PPH hourlies), with plenty of low priced services to pick from. Currently there’s no option to post your own job, but you can ask sellers for a custom quote.
The underdog of the freelance sites, Guru has somewhat of a cumbersome interface, but the quality of workers is good.
The world’s largest freelance site, UpWork had suffered from technical issues until as recently as 2016, however things now appear to be on the up.
Also a massive marketplace, Freelancer.com, like UpWork, allows you to post your projects to receive bids from as many freelancers as you wish.
Activity – Before you use too many tools and websites…
⏱ 1 Hour
Before you so much as sign-up for a single freelance site or tool, register for a password keeper app such as dashlane, Sticky Password or Password Boss(this will keep all of your login details safe – so you can create tough to guess passwords, whilst guaranteeing that you won’t forget the passwords to your most important platforms).
Your Website – Creating an online presence that sells
So, you know you need a website. You start your research and you’re quickly overwhelmed. The options are endless – what CMS should you use? Should you build it yourself or get someone else to build it for you? Let’s take a look at your options…
Which CMS – WordPress Vs. Drupal Vs. Joomla
|Number of websites||75 million||1.1 million||2.8 million|
|Best for…||Everyday blogging websites/brochure sites and online stores. Easy to use and manage.
Easy to add features.
|Complex, advanced sites. Advanced users (web developers).||E-commerce, social networking. More content and structure than WordPress, but slightly more advanced.|
|Pros||· User friendly
· SEO integration
· Easy to implement mobile-ready sites
|· Versatile and robust
· Highly scalable
· Super speedy
· Extensive developer community
|Cons||· Security issues if you don’t take the right precautions
· Slow loading speed if you use too many plugins (unless you have at least a little knowledge on website optimisation)
|· Steep learning curve
· Expensive developers
|· Small plugin marketplace
· Many plugin compatibility issues
DIY, Freelancer or web agency?
So, you’ve picked your CMS, now to think about building your website. The question is whether you’ll Do It Yourself, use a freelancer site or a web agency. Here’s a quick-fire run through of the pros and cons.
· Upskills your knowledgebase
· Plenty of CMS options to suit your skill level
|· Cheaper than an agency
· Freelance websites can remove the guesswork as to freelancer skill/reliability
· Freelance websites offer an escrow service, protecting your money in case the project doesn’t go well
|· Generally higher skill level/better/quality
· Depending on your budget, your website could be designed from scratch with your audience in mind
· More confidence if an agency has a proven track record
· You can spend more time on developing quality content and on your marketing channels
|Cons||· It isn’t cheap if it takes up time you could spend earning
· You’ll need to use a template, which may not be designed for your exact audience
· For the non-IT-savvy, even WordPress may prove challenging to learn
|· Quality of service can vary greatly from freelancer to freelancer
· Depending on your budget, you may still end up with a template
|· Relatively ‘expensive’ compared to DIY/Freelancers
Activity – Planning the mission critical elements for your homepage
Whether handling the design yourself, or passing on to an agency, it pays to understand how your website should be designed for conversion. Plan the following elements with your target market in mind.
⏱ 2 Hours
- Headline – Tell your visitors what your site is offering (make it readable within 3 seconds)
- Sub-headline – Talk about your visitor’s pain-point and what the website does
- Primary calls-to-action – Feature 2 calls-to-action above the fold (e.g. the area that is immediately viewable without having to scroll) – design these for people at different stages of their buying cycle
- Add powerful imagery – Use images that capture imagination and emotion (forget about those tacky stock photos)
- Benefits – Explain why your product/service matters – list out the benefits of buying from you
- Provide social proof – Prove your product or service with testimonials, case studies and counting social share buttons
- Clear navigation – Ensure your menu is always visible at the top of the screen – make it simple, seamless and include a search box where appropriate
- Offer irresistible content – Grab leads by offering a free eBook (just like this one) – with content that is valuable to your audience
How to Start Your Own Business : Business Software – What you need
From scheduling your social media posts to managing the pence, pounds and profit of your growing business, here are the core platforms that you need to know about (and for even more tools – on everything from customer service, legal and sales, HR to R&D and IT, head over to our Online Business Software hub). How to Start Your Own Business.
Award winning Business VoIP and communications service provider SOHO 66 have been around for a long time – and have many accolades to their name. Their services include single and multi-user VOIP, telephone transfer and fax to email services – lowering business costs and enabling them in securing a flexible, professional and cost-effective way of working.
Social media solutions are pretty much an essential for the busy entrepreneur. Amongst which is Hootsuite, a powerful platform that offers many social tools. Hootsuite will save you time and streamline your social network management.
Integrated email marketing, marketing automation, and small business CRM. Send beautiful newsletters, setup behavioural based automations and benefit from affordable software that’s powerful and easy to use.
PayPal is the smart choice for business. Whether you’re looking for a complete payments solution or want to add PayPal as an extra payment method to your existing website, they have a smart solution that’s right for your needs.
Crowdfunding – which puts ideas out to the masses and promises small gifts in return for making set financial contributions. These take the form of tiered amounts, from what could be as little as £5, upwards – with the gifts typically linked to the product that the crowd will eventually make happen.
Xero is a commercial powerhouse for cloud-accounting, and their platform is easily the most popular for business owners that seek laser-precise control over their finances.
You run a blog, or own a website. You need traffic. The bread and butter for which is social media. Trouble is, social media takes time. LOTs of time (the kind that could be better spent on a million and other tasks). For this, there is Missinglettr.
RankingCoach positions itself as an online marketing app for small businesses. With a feature rich, easily navigable interface ideal business startups. It will help you harness SEO, local online marketing and social media.
Automation – In steps the sales funnel
Every start-up aims to consistently improve their profit margins and grow their customer base. Yet very few get a solid plan in place for doing so.
Sales funnels are key to delivering a stream of customers. Yet more than this, they also should lead to something invaluable – understanding how your ideal customer is won (as well as what they care about). How to Start Your Own Business.
Here we explain how to create a kick-ass sales funnel that will serve you well for today, and the many tomorrows to come.
First things first: What exactly is a sales funnel?
Let us begin by defining just what a sales funnel is. First and foremost a sales funnel is the journey that most of your eventual customers will go on, from being part of your target market, through to the key moments before purchasing, onto buying your product or service. Finally (hopefully) they’ll become a repeat customer.
This then breaks down into three distinct types of people to consider:
- Leads: Those who become aware of your company;
- Prospects: Those who move from simply being aware of your company onto someone who has had some form of contact with your company.
- Customers: Those who have, of course, made a purchase from you.
A sales funnel is a tool to define the journey from one step to the next. Here’s how they go…
Becoming aware of your company is the first stage of the sales funnel and can be achieved via tactics such as email marketing, cold calling, social media marketing, attending an event, advertising or word of mouth.
The education stage teaches your target market why they need your product service. This can be undertaken in a number of ways, however most consistently effective has been the medium of explainer videos, which have seen a huge surge in popularity over recent years.
It seems that the stats behind them go to prove why: providing for conversion rates that are increased by as much as 20% (Unbounce); and as video is 50 times more likely to secure a first place Google position over web pages (BrainShark), it can also help secure some serious website traffic.
These stats go to show that the educational step within the sales funnel is an inherently important one, and if you get your video explainer right (or other similarly engaging education medium) then you can look forward to a smooth transition onto a fully-fledged purchasing customer.
Following on from education a prospect will next need to evaluate whether going ahead with the purchase is the best option for them.
To help them with their decision you may provide a sample, trial period, a demonstration or an information pack, or make sure that elements of your platform are open for use free from charge.
At this stage, the prospect has all of the information and resources that they need to make a decision, however a gentle reminder of your product or services, along with an encouraging discount, may just help move the prospect from engagement to commitment.
This stage may or may not be relevant, as according to your industry. For businesses where it is relevant – where deals are done in person or by phone via a sales rep, it’s important to seal the deal as soon after the prospect has made the verbal commitment to purchase.
This stage really needs no explanation, other than to say that you can now crack open the champers… you’ve finally converted your prospect!
The final transition is from purchaser through to repeat customer, and this stage is most certainly not to be overlooked. Tactics to entice people back may include offers for future orders, but also should consider the building of a relationship, such as via social media.
How to Start Your Own Business :Sales Funnel Automation Tools
ActiveCampaign makes light work of creating high-converting, great looking sales funnels. Alongside integrated email marketing and its CRM for small businesses, are stunning newsletters and behavioural based automations that allow you to crunch the numbers when it comes to funnel performance.
The ActiveCampaign team is also super helpful in guiding you through the process of getting up and running (just take a look at this useful guide to get started: The 7 Steps to Sales Automation Bliss).
This isn’t goodbye…
Entrepreneurship is as challenging as it is ultimately rewarding. To make a success of even the brightest of ideas you’re going to need cast-iron determination and unbridled passion. With those three elements, alongside the right resources, support and guidance, you’ve got this.
Where ordinary people achieve extraordinary results.