1

Information

• Fire & Safety procedures

• Toilets

• Refreshments

• Mobile Phones

2

Aims of Module 1

• Outline the advantages and disadvantages of self-employment• Identify reasons for small business failure • Consider your motivation for starting a business• Provide a framework for analysing your personal skills• Describe networks of support• Provide information on sources of finance for a business• Provide information on the legal aspects of starting a business• Provide an overview of business planning, particularly to market research

and assessing start up finance that you require.• Help you describe your business idea and preparation for producing a

business plan

3

Introductions

• Who am I ?• Who are you?

• Name?• You Business Idea?• When do you intend to start trading?• What’s your motivation?

4

Assessing Self-Employment

Advantages

• Personal satisfaction• Financial Rewards• Flexibility• More Time• Independence• Chance of Success• Sense of Achievement• Own Boss

Disadvantages

• Worry• Instability• Unsocial Hours• Financial Pressure• Long Hours• Risk• Change in Lifestyle• Stress

5

Assessing Self-Employment

• Little/No Planning• Lack of Market

Research/Planning• Over Estimating

Demand• Understanding

Expenses• Lack of initial Capital

• Wrong Location• Poor Credit Control• Poor Financial

Management• Poor Management• Lack of Sales• Staff Problems• Lack of Experience• Unplanned Expansion

Why does a business fail?

6

Reasons for starting your own business

Positive• You want to be your

own boss

• You want to work from home

• You want flexibility

• You’ve spotted a good business opportunity

• You want more independence

Negative• You can’t find a

job

• You’re tired of being unemployed/employed

• You don’t know what else to do

• You don’t want to work for a boss any longer

• The job centre suggested it to you

7

Some of the qualities you need

• Determination

• Organised

• Positive outlook

• Creative thinker

• Motivation

• Flexibility

• Patient

• Sociable

• Have vision

• Common sense

• Open to new ideas

• Perseverance

• Listening skills

• Decisive

8

Exercise - Assess Your Personal Skills

Complete this questionnaire to evaluate your personal qualities and suitability to running your own business. Page 9

9

Exercise - Assess Your current business skills

Complete this questionnaire to evaluate your current business skills and create an action plan . Page 11

10

Your Networks of Support

Formal• Local enterprise agency• Fundraisers e.g. Bank/investors• Accountant/solicitor• Department for Work & Pensions• HM Revenue & Customs• Business advisors• Trade associations• ACAS• Chamber of Commerce• Local Authorities• Visit Wales• Finance Wales• Networking Organisations• Business clubs• Health and Safety Executive

Informal• Family• Friends• Colleagues• Ex-employers• Other local businesses

11

Funding your business

Ask yourself…

How much money do you need to start your business?

How much money do you have to start your business?

12

Sources of Finance

• Own investment

• Family/friends

• Business partners

• Private investors

• Leasing

• Asset finance

• Hire purchase

• Credit cards

• Factoring

13

Sources of Financecont…

Loans and Overdrafts

• Banks (loans/overdrafts)

• Credit union

• Building society

• Family/friends

• Finance Wales

• Enterprise Finance Guarantee Scheme

Grants – some possible sources

• Graduate Bursary (Welsh Assembly Government)

• Local Authorities

• Prince’s Trust

• Contact Welsh Assembly Government for details of current grant schemes

14

Exercise – Financing your business

Use the table below to help identify the sources of finance you will be applying for and the actions required. Page 18

15

Legal Status of Your Business

• Sole trader

• Partnership

• Limited Liability Partnership (LLP)

• Limited company

• Co-operative

• Domain / Company names / Business name

16

Tax/NIC/VAT: Legal Obligations

Your options

Tax

• Register your details within 3 months using CWF1 form

VAT

• You must register your details if your turnover exceeds theVAT threshold

• VAT registration can be applied for voluntarily if the correct circumstances exist in your business.

Visit www.hmrc.gov.uk for further information

17

Insurances

Types of cover available

• Public liability• Employers liability• Product liability• Professional indemnity• Buildings and contents• Vehicle insurance• Goods in transit• Money in transit

• Theft• Employment protection• Credit insurance• Glass/window insurance• Plant “all risks”• Key man insurance• Personal insurance• Car insurance

18

Planning Permission

Examples where planning permission may be required

• Changing the use of your building• Displaying large signs• Planning external building work• Building new premises• Extending your premises• Making structural alterations• Putting up new fences or walls• Creating disability access

Contact your Local Planning or Building Control Office formore information.

19

Licences and Registration

• Selling tobacco & alcohol• Providing driving instructions• Operating as a street trader• Providing childcare• Providing taxi or private car hire• Running a residential or a

nursing home • Scrap metal dealing or

processing

• Providing betting or gaming services

• Handling food• Providing a financial

service• CRB checks for working

with children and vulnerable adults

• Technology/software licences

Examples where licences/registration may be required

20

Other Legislation

• Employment law• Health & Safety law• Property law• Consumer Protection Act• Food Safety law• Data Protection Act• Sale of Goods Act• Business Names Act• Disability Discrimination Act• COSHH Regulations• Equality & Diversity

Regulations

• Advertising Regulations• Trade Descriptions Act• Price marking order• Contracts• Partnership agreements• Financial Services Act• Environmental law• Trade Marks/Copyright

law• Patents/Design

Registrations• WEEE Regulations

(Waste, Electrical & Electronic Equipment)

21

Protect Your Intellectual Property

Please complete exercise on page 25

• Trade Marks• Patents• Copyright• Design registration• Intellectual property rights (www.ukipo.gov.uk)• Know how (trade secrets)

22

Exercise – Legal requirement action planner

Use the table below to help identify the legal aspects of setting up your business and the actions you need to carry out to meet your legal requirements and regulations. Page 26

23

Market Research

Market research is an essential part of the businessplanning process and should cover the following in detail:

• Who are your potential customers?• What do you know about them?• What are they looking for?• Who else is selling in this market?• What price should I charge?

Why will customers buy from me rather thansomeone else?

24

Business Planning – An Overview

In broad terms your business plan should include the following:

• Introduction / background• Market & competitors (modules 2&3)• Sales & marketing strategy (modules 2&3)• Operations (modules 4&5) • Financial data & forecasts (modules 6&7)• Appendices

25

Business Planning – Specific stages

Introduction/Background

Main points to consider for your business plan:

• Business idea/background

• Business details

• Legal status

• Owner/management details

• Product/service details

• Financial overview

26

Business Planning – Specific stagesPlease complete exercise on page 29

Describing Your Product or Service

Main points to consider for your business plan:

• Technical specifications

• Features and benefits

• Unique selling points

• Design

• Packaging

• Future development plans

27

Business Planning – Specific stagesPlease complete exercise on page 30

Features and Benefits

Feature

• Wooden floor• Last Longer• Guarantee • High in

protein• Economical

Benefit

• Easy to keep clean

• Saves you money

• Peace of mind• Good nutrition• Saves you

money

28

Business Planning – Specific stages

Unique selling points (USP’s)

• After sales service• Competitively priced• Quality product / service• Free delivery / home delivery• Guarantees• One to one attention• Reliability

Exercise: What are the USP’s of your product or service? Page 31

29

Business Planning –Specific stages

The Sales and Marketing Plan

Market & Competitors

• Market overview• Customers / target markets• Market size / trends• SWOT analysis• Competitor analysis

Sales & Marketing Strategy

• Marketing objectives• Target market• Sales forecast

30

Business Planning –Specific stages

Operations

• Premises• Equipment• Suppliers• People / staff• Production processes

• Systems & Processes

• Legal aspects• Health & Safety• Quality control

31

Business Planning –Specific stages

Financial information

• Details of expected sales• Set up & operational costs• Funding requirements• Sources of finance• Cash flow forecasts• Profit & Loss account• Balance sheet

32

Business Planning –Specific stages

Appendices

• Portfolio of previous work/references • Photographs• Letters of potential customers/firm

orders• Evidence of market research• Legal documents• Sample promotional materials, e.g.

flyer• CV’s of key workers/staff

33

What Next?

1. Ensure that a market exists for your product or service. Do your market research and be sure there is a sustainable market, i.e. questionnaires & surveys

2. Work out how much money you think you will need to get started and how you plan to raise it?

3. Complete as much of the business plan as you can from what you’ve learnt in today’s session and ensure that you bring it along for module 2 or when you meet with an advisor

4. Proceed direct to training modules after completion of 1,2 & 3 above.

34

ANYQUESTIONS?