A Comprehensive Guide to Starting Your Own Business

Nobody teaches you how to set up your own business; you’re expected to just figure it out for yourself. But you can get help along the way from a trusted business mentor and from podcasts like my own Diary of an Entrepreneur.

I’ve been through this process now and I have first-hand experience of the advantages and risks of starting your own business. I believe firmly in helping others up that same ladder, which is why in this comprehensive guide I’m sharing some of my best tips to start your own small business.

There are lots of very strong advantages of setting up your own business. By the end of this guide, I hope you’ll have a clearer idea of how to set your own business up, as well as some of the potential obstacles to watch out for.

What you should consider before starting your own business

No matter what your business idea may be, starting your own business begins with you as an individual. From your first days as a sole trader, through to managing a growing workforce, it all comes back to you – so make sure you’re as ready as you can be.

My own management style is to operate an open-door policy. I want to know what’s happening within my business, and to do that I rely on strong internal communications. If there’s a problem with a contract, a dispute between employees, or a situation that needs my direct attention, I want to know about it.

I’ll go through some specific tips to start your own small business below, but first and foremost, you need to know that you’re ready. However good your concept might be, the stewardship and leadership has to come from you, especially in the early days.

Things you should know when starting your own business

That being said, let’s look at some of the practicalities of setting up your own business:

You need a profitable business idea

Knowing how to set up your own business is irrelevant without a good (and good means profitable) business idea. With a small number of exceptions, you’re in business to make money, so make sure your idea has the potential to do that.

Don’t skip on conducting market research

One of the big advantages of setting up your own business is the ability to research your target market and maximise the relevance and saleability of your product or service. Don’t skip this step, as it underpins everything from your business plan to your early-years cash flow.

Create a business plan

A comprehensive business plan will set out the expected growth path of your new venture, and should also factor in some of the risks of starting your own business. Be realistic about your prospects, but also outline some higher-growth targets as your ‘shoot for the stars’ option.

Think about how you’re going to finance your business

It goes without saying that finance plays a huge part in how to set your own business up, but remember you need more than just enough cash to get started. Depending on the nature of your work, it may take weeks or even months to get paid in full, and turbulence in the economy can massively impact how quickly – and how much – money comes into your business.

Cash flow proved to be one of the biggest headaches I had to face in my own business venture, when I started the video marketing agency Stada Media. Be prepared to take tough decisions, such as making staff redundant, if it proves necessary to keep your business afloat.

Remember the legal steps

There’s no quick and easy way to learn the legal side of starting a new business, so try to have good advisors around you and don’t rush into legally sensitive situations when they arise, without researching them first. A costly court case or employment tribunal, especially in your first year, could easily put you out of business.

The advantages of setting up your own business

So, what are the more general advantages of setting up your own business? Well, you get to decide what products and services you offer – and you don’t have to offer anything you don’t want to. You can choose when to expand into new areas, when to innovate from the inside out, and when to embrace other people’s ideas from the outside in.

You can choose your business hours, your location, who you deal with and who you employ. While these should be driven by sensible business decisions rather than personal preference, there’s a good amount of overlap between the two, allowing you to run things the way you want to.

Exploring the risks of starting your own business

Risk should always be a major consideration when deciding how to set your own business up. Think about supplier risks, customer credit risks, and physical threats like fire and flood damage.

Again, the exact list will depend on the nature of your business, but take some time to identify the existential threats to your new venture, and take steps to mitigate them via insurance policies and sensible business practices.

Tips on starting your own business

We’re close to knowing how to set up your own business – the final step is to prepare for any growing pains in your first years of trading.

Surround yourself with a supportive network

A good accountant, reliable business lawyer and a trusted mentor are all essential components in your support network. Don’t be afraid to include friends and family too. Business is business, but you’re still a human being, and sometimes the support you need is emotional.

Develop a strong online presence

Whether you trade online or not, it’s a simple fact that having an online presence will help you to find customers and build a stronger brand. Small business websites are not expensive. Publish new content regularly to build your search presence and consider social media to support your growth – brand marketing videos on TikTok and YouTube can reach massive audiences overnight.

Networking is key

Speak to like-minded entrepreneurs in your geographic area or within your chosen industry. Reach out on social media or search for ‘business breakfasts’ in your town or city. There are good people out there (like me!) who are keen to share their experiences with those who are still up and coming.

Build a strong team

Grow your workforce as you need to. There’s a constant balance to strike between having capacity available to you, without employing more people than you need. Develop strong recruitment processes and you’ll be able to add to your human capital when required.

Manage your time effectively

Time management should never be overlooked. There’s only one of you, so spend your time where you are needed. When your business is off the ground, consider employing a managing director who can deal with the day-to-day running, freeing you up to focus on building the next stage in your business strategy.

My biggest takeaways from starting a business

As a business owner you’ll experience the full range of emotions, and some you never knew existed. I talk about this in more detail in Diary of an Entrepreneur Episode 13. There are stresses and strains and mental health challenges, which you need to balance against events in your personal life too.

However, the advantages of setting up your own business – the ability to steer your own path and focus on what’s truly rewarding to you – far outweigh the risks and burdens, in my opinion. Work on that support network, find your mentor and grow your team, and you’ll have good people around you when those more difficult times come along.

Final thoughts

For me, starting your own business is something everyone should try IF you have a viable idea that you can build into a fully fledged business plan. It’s not for everyone and you should go into it with your eyes wide open, fully aware that yes, there are certain risks of starting your own business.

But risk can be opportunity too, and I hope with my tips to start your own small business, you can embark on this journey with more confidence, and with a better idea of what to expect. If you’d like to learn more, please watch my Diary of an Entrepreneur series on YouTube, or contact me directly and I’d be happy to answer any questions you might have.