6 Tips for Starting A Successful Business
Kinore, Finance & Business Services
A multi-award-winning Irish & UK Accountancy and Company Secretarial Practice specialising in supporting #SMEs #Startups
Written by Larissa Feeney, CEO, and Founder of accountantonline.ie
Published: June 24th, 2022
Starting and running your own business is always challenging but ultimately can prove very rewarding.??I set up the business in 2011 and incorporated the company in 2015. We have been fortunate to grow our business year-on-year, now working with over 2,500 startup or newly formed business clients.? Through this journey - and by working with a range of entrepreneurs and business owners over the years since starting out - there are a few things I’ve learned along the way that I’d like to share.?
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Running your own business is never totally straightforward! But there are ways to prepare and plan so that you build for a strong future.??
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What are your chances of success???
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Let’s take a look at the statistics and the reasons most commonly cited for business closures.? Although culturally we have a long tradition of entrepreneurialism and have strong supports in place for it in Ireland, 75% of startups face failure within a few years of launch*.? Equally, there are around 15,000 business failures annually in Ireland and a one in three chance of companies making it past 10 years^ in business so unfortunately the odds are stacked against those who set out on this journey.?? A few of the reasons given by those companies include lack of financial management, lack of knowledge about the business, and insufficient resources.?
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Despite these hurdles, Ireland saw a total of 25,695 new company start-ups in 2021, a 13% increase on pre-pandemic levels (2019), reaching the highest numbers on record in 2021.?
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To look at why they fail, we need to look at why they succeed.????
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?When we were working out the finer details of our accountantonline.ie service, we spent time talking to new business owners and understanding what they wanted from their accountant, and how best we could work on delivering this for them.??
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We realised they were finding it tough to understand all the technical aspects of bookkeeping for their business and built an online model so we could deliver webinars and content demystifying this for them.? Building it this way meant that they could easily access information at any time.? It was central to how we structured our business and built up our client base.???
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Knowing the market, and how your product will appeal to customers is really the first step.??
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Who are your customers?? Where are they?? Who are your competitors and what do they offer? What can you do differently -and better -to reach them whether it’s online or in person?? There’s a lot you can learn through surveys, focus groups and questionnaires.???
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How do you structure your pricing and what is the best price point for your product or service?? What do your competitors charge???
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There’s a temptation at the beginning to offer discounts or lower pricing to attract customers but it’s about the long-term game and ensuring you can keep going at these rates.? Work out what will allow you to keep customers but also retain your own profitability.??
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Although a product/service may have originally presented as an excellent idea, and market research backed this up, sometimes the quality can let it down.? Choice and expectations mean that customers will move elsewhere if they don’t get what they want or get a good service.?
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We regularly use Net Promoter Score to gauge customer sentiment – it’s very simple and cost-free. It helps us to measure customer experience and predict business growth.? It’s worth including something like this in the customer buying experience so you can continually get feedback and improve.??
2. What are you hoping to get from owning your own business??
This is a key question.? We’ve worked with clients who are happy to run a service business themselves, where work /life balance is a key consideration or they’re happy to focus on a particularly consultancy niche.?? In these cases, the focus is more on pipeline and making a worthwhile salary.?
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Other startups are focussed on preparing the business for export and growing their presence on both domestic and international markets.? More investment and time will be required to propel a company to achieve this.???
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You may need to seek external investment in the form of angel, VC or Enterprise Ireland funding. There are various options available to you and each will have their own requirements – for example, if you apply for EI funding, it may be HSPU, there are 3 key criteria to achieve:???
-selling a new or innovative product or service to international markets?
- being involved in manufacturing or internationally traded services and??
- the creation of 10 jobs in Ireland & realizing €1 million in sales within 3 years of starting up.?
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So, ask yourself: what are you hoping to achieve?? What agencies or organisations can help you to achieve this?? Once you’ve decided on your key goals, this will determine how you fund, run and grow your business.?
?3. Do you have the right people around you??
?You have the idea - and the vision -for your business.? And that will certainly get you so far but there comes a time when you need to step back and assess what skills will be necessary to take the business to the next level.???
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In 2017, online visits to accountantonline.ie were at just 700 per month.? Now we’re hitting over 25,000 visits to the site every month and continuing to grow this number.? Partnering with a digital expert helped me to accelerate this aspect of the business – something I wouldn’t have achieved without hiring the right expertise.?? It’s about knowing your skills and what you need to get help with so you can hire the appropriate team members.?
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4. How will you fund the business??
?The first thing to think about is the type of funding.? Where are you going to generate funds for the business????
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Are you ready from a financial perspective?? One of the main challenges facing business owners is financial stability. The majority of small firms close within a year due to a lack of financial management and inappropriate utilization of funds and cash-flow during the initial phase^^.? Around 21% of startups fail due to the wrong use of investment.?
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We’ve found that 68% of our clients started their business using their own savings. However, for the others, it will involve pitching their business idea to secure funds which means pulling together a robust business plan.? Serial entrepreneur and startup expert Bill Gross describes the business plan as a ‘clear path to generating revenue’.? A lot of startups can struggle to translate their ideas onto paper into a clear strategy.? But taking the time to work through this document will really help at the funding stage.?
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There’s a lot of supports available -either through traditional banks or via government agencies /accelerator programs.? In Ireland there are 4 main sources of finance: loans, equity, personal funds or grants from government agencies.???
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Take time to consider the type of funding that will work for your business and to develop a business plan to outline how you will run that business.??
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5. Know your numbers?
?As an accountant, I’m obviously very comfortable with the financial side of the business.? As a business owner, you don’t need to know as much as that but you do need to understand the key figures.? There’s a reason why the startups on Dragons’ Den are grilled on their financial projections!?
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Investors want to be assured that the financials are solid.? Key considerations include:?????
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6. Brand Awareness, Sales & Marketing??
?All startups face the challenge of building their brand name and driving sales and web traffic.?? If no one knows about your business, how do you generate business and how do you grow??
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At the very minimum, startups must create an online presence.? Consumers are online and expect their chosen brands to be there also.? Digital marketing will help to raise awareness and cut through all the online noise.? The extent of digital and social media activity required will depend on what type of business you are in and where your customers are.???
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There is a range of resources available to help companies to develop a marketing framework and create digital marketing plans and social media business profiles.??
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Come talk to us!?
We really want to see our clients succeed, and try to help them whenever we can to navigate the challenges of owning and running their own business.???
Hope there are a few nuggets in this that can help you on your way!?
Tune into our events calendar for regular information sessions to help startups or take a look through our library of useful tips and guides.??
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Sources:?
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*van Scheers, 2016 (researchgate.net)?
**Crowley et al., 2018; O’Brien et al., 2019?
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