Plenty of great businesses start with a dream – an idea that comes to you in a flash and gets you motivated enough to think about starting your own business. But whatever the dream, you will need to encapsulate your end goals, decide on a strategy and find the funding needed to get that company off the ground – and this means sitting down to write a clear, effective business plan!
Getting your business down on paper
Writing a business plan has to two key benefits for you as an entrepreneur. Firstly, taking the time to write a business plan helps you to focus on your business idea and work through the details of your business model. It forces you to think about the key questions and get them down onto paper.
- What is your objective for creating the business?
- Who will your customers be?
- How much can you charge for your product/service?
- What will it cost you to make this product or deliver this service?
- Will you need employees or will you go it alone?
- What will your predicted profit margin be?
- What is your turnover likely to be in year one?
Once you’ve considered these questions, and given your best shot at the answers, you will have a reasonably good indication of whether your business has the potential to bring in business, create the right revenues and deliver the income you (and your team) need to live. Secondly, writing down your business plan makes it easier to demonstrate your idea to investors and partners. It gives you a clear explanation of your business model that you can then put in front of your bank, potential investors and other partners you may need to work with along the course of your business journey. In a nutshell, writing the plan highlights the elements of your business idea that work, and shows you where improvements are needed to turn your dream into reality.
Researching the market
You may have had the best business idea since the wheel, but it means nothing if there isn’t a market for your product or service. So researching your intended market is a big part of making your business plan watertight.
- Is there a need for the business in your local area?
- Where will the best location be to set up shop?
- Who will your core audience be?
- How will you advertise and promote your business?
Understanding the potential market for your product/service is extremely powerful. It allows you to be far more realistic about your income potential, your predicted profits and the underlying stability of the company.
Dealing with the management and administration
Setting up the business is not just a case of finding customers and making money, of course. As the founder and owner, you will have all kinds of new responsibilities that you need to include in your detailed business plan.
- You have to decide on your business structure – will you be a sole trader or a limited company (the way your taxed will be different for each)?
- You must make your new business known to the Irish Tax & Customs and the Companies Registration Office.
- You will have to register for income tax, corporation tax, VAT or PAYE, if they’re relevant to your business structure.
- You will need to look at tax planning and the impact of your tax payments on your overall cash flow for the year.
- You should consider putting insurance in place to protect your income in the event that you can’t work.
Managing your finances
One of the big things to think about is how you source and arrange the capital needed to start the business. And once you’re trading, how you manage your finances to guarantee the best possible return on this original investment. Your bank may be happy to offer you a business loan, or you may have to source your capital from private investment. But wherever the funding comes from, your partners will expect a transparent view of your financial progress, repayments made on time and a stable return on any private investment. Having a modern cloud accounting system in place, such as Xero online accounting software, will help you to manage your momey, keep on top of your spending and give you (and your partners) a great overview of your financial performance. Xero will also help you to cut down on the paperwork and improve your admin:
- Xero’s online invoicing function to cuts out the need for hard-copy invoices.
- Email your bills straight to your customer with no postage costs.
- Get paid faster through online payment gateways, such as PayPal.
- If your bank offers it, there’s a live bank feed so you always know your current bank balance.
- Speeds up bank reconciliations and have an improved view of your cash flow.
There’s also the option of outsourcing your bookkeeping and financial admin to a third party. Rather than spending time on data entry and bank reconciliation, you can hand over the admin and enhance your focus on driving the business forward.
How Baker Tilly can help you
Working with a business adviser will really give your business plan an edge. With nearly two decades’ experience of working with Irish start-ups and small businesses, Roberts Nathan can help you review every detail of your business idea to ensure your plan is clear, realistic and actionable within your stated timelines. We can also help you streamline your financial management by taking on your bookkeeping burden and giving you back more business time. Set up a meeting with our team and they will help you turn your business dreams into a profitable, efficient reality.
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