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April 10, 2023
Media

Don’t skint on these five when starting a new business

The checklist for business start up is long and varied. With a long list of actions, processes and essentials are needed to ensure business success. For start ups, it is like being caught in whirlwind. So much to do, so little time and not enough cash. There are so many different stages. Skipping a few steps is tempting. While you can get away with not forking out big bucks on Google Ads or a full time copywriter, don’t overlook these five key areas. Especially if you want to keep your business out of a precarious position financially and legally.

Get Structured

Accountants will tell you it’s important to determine the best business structure for your venture. Sonia Gibson from Accounting Heart said starting with the end in mind is as important as setting your direction based on your goals.

“Choosing the correct structure comes with a great deal of research. You must consider how the various structures will influence tax contributions, operational structure,  cash flow, and ability to grow your business over time. You also need to plan your startup costs before you launch so that you’re equipped to kick-off successfully,” she said.

“Money is needed to fund the startup costs and to cover living expenses through the startup phase. Meeting with an accountant to discover your tax obligations and to help you set your pricing intentions in line with your goals is also essential.”

Sign On The Dotted Line

Many think the legal stuff will never happen to them. The fingers crossed approach to a business launch is nota sound approach. Neither is  having the best intentions or believing the best in everyone. This can be a slippery slope to legal disaster. Lawyer Courtney Bowie said getting contracts done properly is often close to the bottom of the to-do list during the start up phase.

“Not because entrepreneurs don’t think they’re important – they know they are – but they’re often worried about the expense and stress of the process when working with a lawyer,” she said.

“Finding a lawyer whose business values resonate with you and someone who works on fixed fees is vital. The right firm will make you feel valued, empowered and in control. The heart-wrenching scenarios we’ve encountered where clients have come to us too late: not having an agreement between shareholders in a company, which later caused one shareholder to walk away from five years of hard work with nothing.

“Or no agreement as to the use of copyright materials, which resulted in a significant settlement with the copyright owner and lots of money wasted on legal fees and time lost negotiating, not to mention the emotional toll.

“Or a poorly worded contract resulting in a business owner having to issue numerous refunds to clients during a pandemic.”

People, Culture and People

There’s a perception the people side of business – human resources – has to involve a very highly paid HR manager and/or HR team. This isn’t always affordable, so many businesses resort to doing it themselves.  Katriina Tahka CEO of A-HA – A Human Agency said virtual HR services are a good alternative so this step is not skipped.

“Virtual HR manager service, that are there when needed, are a great solution. You save money in the long run avoiding issues with non-compliance, workplace behaviours and other areas that require someone with sound legal knowledge. I’ve seen companies who have, from the beginning, asked themselves “what do we want to be known for?” Consider not only the customer experience but the employee experience too,” she said.

More Than A Logo

You’ve got your business name ready to roll out. The next thing on the list is a sparkly new logo and business card. Many businesses think this is the start and end of marketing. But branding specialist Karen Moloney believes branding is about much more than a logo and business card.

“You started your business because you wanted to do something you are passionate about and that passion, your values and the kind of clients you want to attract should all be conveyed by your brand,” she said.

“Diving into your business without fully fleshing out your brand can lead to ineffective and expensive marketing. It also leads to missed opportunities to improve client experience, hiring the wrong people, attracting the wrong clients. It ultimately creates a business that will be hard to run and may not go the distance.”

Protect Your Assets, Protect Yourself

Investing in insurance and legal representation is vital when starting a business. A business is most vulnerable in its infancy, operating with limited resources and large financial risk. Monique Reibelt from Honan Insurance suggests adequate advice and protection could be the difference between financially stability and failure.

“If there’s an incident, the business or people could become legally liable for personal injury, property damage and/or financial loss. With limited funds to fall back on, speaking to experienced professionals is recommended,” she said.

“Tailoring insurance coverage to the individual business and having it reviewed by professional legal representation ensures required coverage and contracts and agreements are in place.”

Set a Clear Path For Success

The truth is many people do muddle their way through the startup phase. True success happens when entrepreneurs realise that they don’t know what they don’t know. The proverbial treasure chest contains all the business world’s secrets to success. Unless you open it, you’ll never know how many tools and essential bits of knowledge you’re missing out on.

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