By Sarah Shields, GM & executive director of small and medium enterprises, Dell
UK startups and entrepreneurs are the lifeblood of any modern economy and it’s the spirit of entrepreneurialism that spurs bright young minds into developing their own businesses. However this is a perilous business with one in three start-ups failing in the first three years (BIS.gov).
Learning how to become a successful entrepreneur is often a process of trial and error and regardless of a country’s level of economic development, there is always room for improvement when it comes to encouraging and assisting entrepreneurs. In a recent independent report conducted on behalf of Dell, the Dell Gender-Global Entrepreneurship and Development Index (GEDI), the UK came 6th out of 17 countries which identified the strengths and weaknesses for entrepreneurs within the country. In order to turn a great idea into a successful business, entrepreneurs need support in areas such as finance, expertise and backing.
We asked three entrepreneurs for their tips to starting up a small business; focusing on topics such as planning, testing, networking and funding.
Create a robust plan
“Before you venture into any new business it's important to develop a comprehensive plan, this will help you in case you run into any problems. Creating your own business cannot be done overnight it requires a huge amount of preparation,” this sentiment was stated by Sam Zawadzki, AdvancetoGO who adds “running your own business is hard. Really analyse your driving forces for doing it. If you can't commit completely to your business then it might well fail. Be clear what your business idea is and what you are trying to do.”
Test your business idea
Once you have your plan you can move towards turning your idea into a real business. Peter Scargill, from the Federation of Small Businesses stresses the importance of getting your product right for your intended customer. “If the product is no good, you won’t meet your targets and all you’ve lost is your time. I think that understanding your market is probably the best advice I could give…It’s all too easy to go into business because you’ve come up with something that you think is great. But it’s not so much what you think; it’s what your potential customers think that matters.” Peter suggests that new technology trends can help such as crowd sourcing and social media, which if used properly can help you test out your product, “It’s important to get a mix of feedback and not just pick on close friends to judge your product.” Peter stresses that new technology trends can help such as crowd sourcing and social media, which if used properly can help you test out your product.
Raise awareness through networking
It’s also important for small businesses to be able to connect with their clients and customers, and other entrepreneurs. Having occasions where entrepreneurs can network will really benefit you as you will be able to share advice which is vital according to Rajeeb Dey, CEO of Enternships. “It’s really important you work on developing a strong network early on in setting up your business. When we first started, most of our business was generated through word-of-mouth and referrals and even today 70% of our new business is through referrals.” Networking isn’t just about sharing tips and advice you can also get comments around your business which you should not ignore. Networking can even open opportunities to meeting partners or mentors for your businesses, and often get even more out of it than you anticipate.
Secure the necessary funding
Getting funding for you businesses is important and currently it is a crucial restricting factor for many small businesses. British Chambers of Commerce’s Director, John Longworth, has noted “money is failing to reach the right destination, despite the fact that the small-to-medium sized businesses are the real drivers of economic growth.” However in recent months there has been a real push to change this and lending to small and medium-sized businesses is on the rise, according to recent figures released by the Bank of England. New funding from companies such as the Royal Bank of Scotland and Whitehall initiative, StartUp Loans will bring around new opportunities for small businesses, and urge companies to invest too.
Starting up your own business isn’t a decision anyone should take lightly, it is extremely hard work and very time consuming but the rewards can be amazing. Developing a plan is the best way to start to make the transition from an idea to a fully-fledged business smoother. If you work with the right partners, have clear objectives and have the future of the business in mind then your business has a much better chance of surviving and growing. Opportunities for start-up businesses are increasing and better support is becoming available to them through networks and funding. This needs to continue as start-up businesses are a vital part of our economy.
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