Forming a new company is incredibly exciting and can offer an extraordinary world of opportunity you never knew existed. But how can you make sure your business does not fail? The difference between success and failure for a new business often boils down to perception. How your company is regarded by potential customers or clients, members of the general public, and even your own employees has considerable impact on its performance.
What does that mean for your new business? Essentially, it means that nobody wants to do business with a ‘two-bit’ operation being run out of somebody’s garage. Like it or not, people try to avoid getting involved with a micro-business which they may perceive as being a ‘here today, gone tomorrow’ enterprise or a cottage industry company.
Doing business with a business nobody has ever heard of represents an unjustifiable level of risk. It doesn’t matter what you’re selling or what your business is setting out to achieve. Most consumers are programmed to perceive bigger or more innovative companies as being safer or superior.
Why? Because, generally speaking, big companies are created by people who are good at what they do. They’ve got thousands of customers who can’t all be wrong, and they’ve racked up thousands of brilliant reviews.
Bearing that in mind, if you want to successfully attract clients, you’ve got to prove your business can position itself as a sustainable market leader. Unfortunately, cultivating a world-class reputation for a company you’ve only just formed can be an incredibly tricky task to pull off.
But it is possible, and you’ve got the ability to do it, too. Take it from a genuine serial entrepreneur who’s started quite a few companies: all you need to do to make your business succeed is follow these 10 real-world tips.
Top 10 tips to make sure your business succeeds
1. Trade as a limited company – never as a sole trader
First and foremost, if you want to create an image for your business as being large and successful, you absolutely must incorporate your business as a limited company.
Why? Simply put, all big and well-established companies operating in the UK are either LTDs or PLCs. While you’ve got the option to do business as a sole trader, in doing so you’ll be sending a message to potential customers or clients that your business is small and probably run by a single person.
But the need to form a limited company goes far beyond external perception. It also protects you from financial ruin – because by incorporating a limited company, you’ll be driving a legal wedge between you and your business and you will transform your company into its own entity. This means as the company’s owner, you can only be liable for an amount up to the value of the shares you have in your company. Any amount of money or assets you own, beyond the value of those shares, will be protected in the event your company runs into financial trouble.
This protection is referred to as “limited liability”, and it will make your life a whole lot easier in terms of finances and getting to sleep at night without worrying yourself sick. After all, the risks of trading on an unlimited liability basis are petrifyingly enormous. So, if you want to succeed, you absolutely must choose a good company formation agent and incorporate a limited company. It is simply not an option.
2. Choose an original company name and pay a professional to design a company logo
We’ve already covered the fact that, when it comes to a new business, image is everything. That image starts with your company name and logo.
Large corporations you may be competing with, hire the top professionals in the industry to create jaw-dropping graphic art to help them sell their products or services – and fair or not, you’ve got to be able to compete against those companies and their professional logos. That’s why you’d be doing your business a huge disservice by trading with a lame or amateur-looking company logo.
Wherever possible, you should pay whatever you can afford to get professional advice on crafting the perfect name for your company. There are plenty of affordable creative agencies who would be willing to help with this on a consulting basis.
Learn about company name rules and restrictions before selecting a name and setting up a company.
3. Use a corporate address for your company – definitely not your home address
Let’s get one thing straight: there is absolutely nothing wrong with working from home. There are some hugely successful companies that started out (and are still based) in somebody’s home office. That being said, nobody should ever know that you’re running your entire business from home.
Fortunately, nobody needs to know. If you’re working from home or your business is constricted under modest circumstances in a non-commercial location, you can get an address service company or business centre to supply your business with an official registered office and business or virtual office address.
Both addresses need to be published on your website and on your company’s official stationery for the world to see – and so if you can obtain use of a more prestigious address to be recorded on the public record, why wouldn’t you take advantage of that opportunity?
4. Get a business landline telephone number and never answer it yourself
Only micro companies try to do business using a mobile phone number – and it looks fairly unprofessional publishing a mobile phone number on company stationery, on the side of your business vehicles or on marketing material. To consumers, operating your company from a mobile number sends the message that your business is unestablished.
That’s why you should always use a business landline telephone number that can be tied to the geographical location from which your company is actually trading. But why is it important that your trading address and business telephone number match geographically?
Essentially, it’s because your customers are smart. They know how to put two and two together and tend not to trust a company calling from one city, when that same company’s website claims it operates out of a different city. That same mistrust can be created by using an 0800 number without displaying a geographical business landline number beside it.
Likewise, you must always observe the golden rule of business landlines: never answer the main telephone number of your business yourself. By answering the phone, you’re screaming to customers that you are a one-man business. That’s why, if you genuinely are running a one-man business, you should either look into hiring additional staff or consider taking out a virtual office package from a business centre or a business telephone service.
No matter which route you choose, you absolutely must get this one right. Anything else is business sacrilege.
5. Get your company VAT Registered
As a new limited company, you do not need to register with HMRC to pay Value Added Tax (VAT). But if you’re trying to establish a fantastic image for your business as being large and successful, you should definitely register for VAT. Why?
VAT registration is a strict requirement for any UK business with a taxable income that exceeds £85,000 per year (or any business expecting to either exceed that figure within the next 30 days or receive goods from the EU valued at more than £85,000). That being said, you can opt-in for voluntary VAT registration even if your taxable turnover is under £85,000.
By registering for VAT, you will receive a VAT Registration Number that you can then display on your company website, and stationery. This number will tell customers that you are registered for VAT, and so they will inherently get the impression your company turnover is substantial in size. As previously outlined, customers and clients often associate high profit with skill and success.
6. Build the best website you can afford
In this day and age, your company’s website is its window to the world. And unfortunately, web users are ridiculously fickle. It only takes 50 milliseconds (which is 0.05 seconds) for somebody to form an opinion about your website. That split-second opinion will ultimately determine whether they like your site, whether they’ll stay and whether they’ll buy something, visit your brick-and-mortar shop or get in touch.
That places a huge amount of pressure on your business to get your website right on the first try – and to many customers, it’s fairly easy to tell the difference between a small, unprofessional business and a well-run multinational corporation. Web users need to be reassured by the warm glow of trust that goes hand-in-hand with a well-designed website.
You should spare no expense when it comes to creating your website. Not only will it reassure your customers, but it can help you to establish your company as a trusted brand, generate marketing and sales leads and provide easy income for your business. If possible, seek the advice of a professional creative agency or web developers to create a website that will stop users in their tracks.
7. Master the Internet and conquer Google
What’s the point in having a fantastic website if nobody can find it? The web is awash with half-decent websites, and it takes a lot of hard work, determination and strategy to get your website in front of the right people.
If you want your website to get found and generate traffic, terms like rankings, traffic, SEO, SERPS, organic listings, PPC, AdWords, meta descriptions and tags, conversion, impressions, ROI, bounce rate and dwell time are all going to need to become second nature to you. And to be honest, that journey starts with wrapping your head around how Google works and mastering it.
Search engine optimisation (SEO) is a notoriously fickle field, but it is incredibly important. Most user journeys for potential customers or clients looking for goods and services start on Google, and so you need to assess your website and do everything you can to optimise its SEO value to position your site well, in search engine results pages (SERPs).
Bearing that in mind, you should focus on hiring a good and reliable SEO executive or agency who will be able to act responsibly and safeguard the integrity of your website, while simultaneously changing things up to help your site build traffic, develop organic rankings and generate a huge following online. This is easier said than done, and so you’ll need to become something of an expert to survive.
8. Sign up for Trustpilot and start collecting reviews as soon as possible
Big companies and brands that people trust, trade off their reputation. Those reputations are generally built through years of experience and success in their industry – not to mention many thousands of pounds worth of digital media and advertising.
Unfortunately for you, that natural trust factor customers associate with big corporate entities, is just not available to you. But consumer trust is required to succeed, and you can start building that trust right now by earning genuine positive reviews from customers.
That means you should sign up for online review platforms like Trustpilot, Feefo, FreeIndex and Yelp immediately. These review sites provide an invaluable resource for your prospective clients to read through the experiences of others, compare them against your competitors and ultimately decide who they should be giving time and money to.
The best way to build a large bank of sincere customer reviews quickly is to get organised with a reviewing platform so that you can start to gather customer reviews by way of an automated invitation process, and then publish the reviews with star ratings.
Most review platforms also provide a ‘kickstart’ service to let you invite past customers to provide a review, by letting you send out bulk invitations manually to your existing customer database. This is a fast way of collecting reviews when getting started with a review company.
9. Make sure you know more about the thing you are selling than anyone else
John Paul Getty, who used to be the world’s richest man, once said: “to succeed in business, to reach the top, an individual must know all it is possible to know about that business.”
This quote may be over 50 years old, but it is more relevant today than ever. You should never, ever expect anyone to buy something from you unless you can display a comprehensive knowledge of it. As the owner of your business, you must be able to explain exactly why the customer should buy it. Yet above all else, you need to be able to do this better than all your competitors.
After all, chances are you aren’t the only company selling whatever it is you are selling. To stand apart from the competition and win the respect of clients and customers, you need to be able to sell those goods or services better than anybody else on the market.
10. At all times – day or night – know your business bank balance
Former Prime Minister Harold Wilson once said that “a week is a long time in politics.” Well, a day is a long time in business, and so if you don’t know exactly how much available cash you have in your business account and what bills and payments are coming out, at all times, your company could end up going bust over the course of just a single day.
Organising yourself financially is not an option. You need to sort yourself out quickly and get a grip on your finances – because if you’re not organised and keeping tabs on your company finances, chances are your business won’t survive six months.
From the outset of your company’s life, you should be using a good online accounting package to organise, record and file your financial records, such as invoices, purchases, overheads, salaries, etc. It’s also worth arranging a consultation with a chartered accountancy practice to get you off and running using the correct financial reporting and control protocols, as a lot of missed opportunities with regards taxation and allowable expenses can be missed unless you are organised from day one.
Those are my top 10 tips to help your company succeed – but they’re not my only tips. There are a few more key areas you’ll want to focus on to make sure your business doesn’t fail, so keep up to date with the Rapid Formations blog for continued advice and inspiration.