Running a business can present a number of challenges, such as finding reliable staff, time management and building relationships. Imagine doing all of the above while managing a full-time job.
This approach may not actually be such a bad idea, and could work in your favour. It offers a number of benefits, such as financial security and the time to build your brand prior to launch.
A good starting point is to review your existing employment contract and speak with your employer to identify whether there is anything that legally prevents you from starting your own business, such as a non-disclosure agreement, non-complete clauses or restrictive covenants.
It is important to manage your time effectively and plan for the future. There are only 24 hours in a day, which means a limited amount of time to eat, sleep, work and run a business.
Set short and medium-term goals and work towards them. It can be tempting to run your business at work by making phone calls and sending emails, but this should be avoided as you could be disciplined – or even dismissed. Create a weekly task list and have an exit strategy to help you to run your business more efficiently.
However, all work and no play can be counterproductive; taking time out to rest and reflect, or taking a holiday, may pay dividends. A good tip is to save your annual leave for work-related activities such as networking events and meeting clients, and for time out to rest.
Having a full-time job offers financial security and allows you to maintain your current lifestyle, which may not be possible otherwise. You can minimise the need to borrow money by setting a bit of money aside each month to spend on the new business instead of buying a new pair of shoes or going out for a meal. Starting a business can be costly due to related costs such as stock, equipment, vehicles etc.
If possible, try to grow the business as organically as possible by not borrowing money unless it is necessary – the majority of businesses fail within the first few years of trading. Use savings, or generate money from friends and family – or even a fundraising page.
If you operate as a sole trader or limited company, you will have to register with HMRC and complete an annual self-assessment form. You may also need to register for VAT if your income is near the threshold, which is currently £85,000. Speaking with an accountant an/or HMRC will identify any tax implications. A good tip is to put aside 30 per cent for tax and National insurance contributions to avoid any unexpected tax bills.
Starting a business on your own can often be a lonely, stressful and taxing journey. Getting additional help from a start-up adviser, mentor or accountability partner would help, as you can share best practice and have someone to run ideas by.
There are a number of different support mechanics, such as:
FSB Business Creation membership
Government support schemes
Independent start-up companies.
Family and friends can play an important role, as they may be able to assist financially, help generate new ideas and support with marketing. It is also worth speaking to people outside of your network, as friends and family often tell you what you want to hear – not what they think you should be told.
Before giving up your job, it is worth testing the water to identify any potential risks and assess what does and doesn’t work. This could be considered at the pre-trading stage, as it is the perfect opportunity to create a marketing strategy, build new relationships, purchase equipment and build a brand prior to launch.
Once you’re sure your new venture will work and you will need to focus on it full-time, tell your employer about your business and any projected end-dates, instead of them hearing it from a third party.
They may even be willing to make adjustments, such as reducing your working hours or letting you work from home. It can also present the perfect opportunity to gain new business by promoting your products and services to your colleagues.