You will find that a lot of guides to writing a marketing plan are heavily laden with marketing jargon; buzzwords that may sound impressive, but upon closer inspection mean very little. This guide offers practical advice on how to write a marketing plan using plain English.

Why write a marketing plan?

Put simply, the aim of developing a marketing plan is to map out how you can gain more customers for your business, which strategies or tactics are right for your business, and how and when you are going to use them.

It should detail who you intend to sell to, how you will sell to them and how you will let them know about your business.

The marketing plan may form part of your overall business plan as a complement to investor presentations, or you may want to write a marketing plan as a separate document.

The focus should be on gaining new customers, persuading current customers to buy more often and getting inactive customers to return. They’re also useful for establishing what your strengths and weaknesses are as a business, who your key competitors are and what campaigns they’re running.

We’ll be looking at what you should be doing before you write up your marketing plan, how to write one, and examples of common elements you’ll find in a marketing plan.

Before you write a marketing plan

You need to identify the target audience you are aiming your product or service at, or indeed clarify whether there even is one.

Too many small businesses fail because they haven’t done enough market research. Don’t just rely on what your friends and family say, as they may not be the most objective observers.

>See also: Guidelines for conducting market research for small businesses

A market from which you can profit will be made up of people who need your product, or at least have a perceived need, and who will be willing to pay for it. Understanding your customers will allow you to identify the best way to sell to them.

Think about your product or service and who is likely to spend money on it. Remember, if you aim to sell to absolutely everyone, you will be less successful than if you can narrow down your market focus. A product or service aimed at everybody is one aimed at nobody.

Conduct face-to-face interviews

If appropriate, get out there and conduct some market research face-to-face. Ask people in the street if they can see the need for your type of business in the area and how much they would be willing to pay.

Survey the market

Identify who your competitors are and try to spot any weaknesses in their strategy. Can you capitalise on this? Is there a lot of competition in that area or will you be filling a gap? If not, could you find somewhere else more suitable?

How to write a marketing plan

Your marketing plan should consist of two halves: the brand proposition and the communication plan. The brand proposition defines your reason for being and why you answer a need, while the communication plan explains how you’re going to get the message out there.

Know your brand proposition

You need to spell out the thinking behind the brand you want to establish. Why should people care? A clear brand proposition will contain some form of:

Purpose of the brand: the purpose should define what you do – we exist to….? If you find that difficult, try defining what you don’t do – sometimes that marks businesses out from the competition. For example, “We are a locally produced soap product that only uses vegan ingredients not tested on animals.”

A purpose doesn’t need to be a perfectly crafted strapline, nor it is it likely to be seen by the public, but it should reflect what your business stands for.

Who your target customer is: who you think should notice and care about what you are offering – and why. The more focused this is, the better. If you have several focused customer groups then there should be a sense of priorities, possibly distinguishing between their value and the order in which you’ll go after them – these are not always the same.

When thinking about your target customer, try not to think in terms of demographics, such as “Young mums aged between 25 to 34” and more in terms of values, such as, “Environmentally aware women supportive of local independent businesses”.

Pro tip: Visualise your perfect customer and sketch out how they spend their day to tap into their mindset, attitudes and behaviours. Are they cost conscious? Then explain how a bar of more expensive vegan soap is better value than cheap shower gel. Creating this pen portrait may also help you figure out the best time of day to communicate with them.

What is unique about you? What makes your business better than the competition; some use the term unique selling point (USP) but really, it’s what makes you stand out from the crowd. You need to demonstrate what it is about your product, service or business model that will give consumers the reason to believe you.

What is behind the name: If this is not perfectly obvious (usually a good place to be with a name) then what is the story behind your company name? Is there an anecdote you can use in marketing or a press release?

>See also: Britain’s funniest business names

Tone of voice: This is important. The way you want to show up in front of your potential customers, the kind of language you would use, your house style, must be consistent. If you are setting yourself up as a financial adviser, for example, you would want to reassure and be patrician. A novelty kid’s product might be zany. Ben & Jerry’s ice cream still has a Sixties counterculture vibe, even though it’s owned by Unilever.

Pro tip: Create a mood board to illustrate the tone of voice, other brands or services which have the same kind of ethos to yours.

Communication plan

If the brand proposition is to get everybody excited, the communication plan is how you get the message across. Again, this will be defined by your target audience. Marketing channels to consider include:

• Direct marketing – either through mail or hand-delivered flyers
• Social media – where does you target audience like to go? Instagram, TikTok or if it’s an older demographic, Facebook
• Out of home advertising – the cost of renting space on a digital billboard can be less than you think. Digital screens typically cost £1,000 a week, according to 75Media.
• Events and trade shows – best for B2B businesses where you can meet potential customers

Make it short, concise and easy for the rest of your team to understand

Indeed, you may have to pass this on to other members of your team – or other parts of the business altogether – so keep it clear and accessible.

“I think that a marketing-centric business needs to have something that someone who isn’t marketing trained can read through and be like, ‘Yeah, okay, I get that. I know where we’re headed,’” said Rachael Dines, founder of Shake it Up Creative, a marketing firm that helps small businesses write their marketing plans.

Dines has developed her own template, ensuring that it’s very bright and that it’s got clear sections for each of the different areas discussed with her clients. “People could update either one or more sections or the whole thing if they need to over time,” she told Small Business.

Setting a budget

You also need to think about cost. Setting a budget is important and will help keep your advertising spend in check. Consider which of these marketing strategies will give the best return on investment.

“The question I always get asked is, ‘Well, how much budget should I have?’ And that’s not always a set percentage,” said Dines. “But I think you have to look at spending it very wisely. Of course, we know that marketing is a bit experimental. But reviewing it regularly is very important.”

To measure your return on investment (ROI), look at anything that you can track digitally, such as unique tracking codes that can be used, utilising analytics to see where visitors are coming from and whether the specific campaigns that’s utilising all the social media platform insights to get that engagement data, any kind of sales figures that align with marketing activities and marketing, said Dines.

“It can be hard to track because sometimes it takes people a few goes of seeing something before they start to interact with it. It’s never completely accurate, but give yourself a good idea. It’s using a mix of tools, not just relying on one thing.” This could be looking at email open rate, pay per click (PPC), web traffic or video engagement.

You could even ask similar businesses in another area how they go about advertising. You would be surprised how generous people are with their time. Speak to people in a similar situation, but preferably not the businesses against which you will be competing directly.

Get the message across

Having clearly defined goals will allow you to keep an eye on how you are progressing over a set period of time.

Does the message you are putting across need to be short and sharp, or will you customers be willing to spend more time learning about what you have to offer? Either way, there are some key points to consider, which should be included in your marketing material to make it more persuasive:

• Explain the problem facing your customer and identify a need for your product or service
• Emphasise that it is important to solve that problem
• Explain what makes your company different and why it will benefit people to buy through you
• If you have them, give examples of satisfied customers and their comments
• Explain prices and how to pay clearly and concisely
• If you can, give some sort of guarantee as to the quality of your work or product, or offer incentives or discounts for responding within a set time period.

Set targets and review progress

Having clearly defined goals will allow you to keep an eye on how you are progressing over a set period of time. Use SMART targets as a useful way of approaching this area. SMART means that your targets should be:

• Specific
• Measurable
• Achievable
• Realistic
• Time-specific

You could include sales targets and the amount of profit you are looking to achieve, targets for enquiry levels and so on.

Once a month, you should conduct a short review of progress to see how you are getting on and whether these targets need to be adjusted. However, don’t jump to re-adjust targets immediately if you aren’t hitting them. There may be something else in your marketing strategy that could be changed and will allow you to achieve more.

“When I do a plan, I generally go through who the target market is, what the products are, pricing and the process and timings,” said Dines.

Detail is key here. “Normally, it’s that people have things they want to achieve, but they don’t put a time on it. They’re not specific enough. Some of them will just say, ‘Oh, we would like to do X, but there isn’t a time on there.’ There’s no drive or endpoint for them to work to. And they won’t know how long to do their activities for, how much budget would apply to it, etc. That’s the fundamental mistake.”

As mentioned, reviewing the plan can also help you learn from any mistakes and help you adjust. When you write your marketing plan always bear in mind your desired results. The plan is therefore an important tool to help you author your business future.

Dines says that marketing plans don’t tend to be published and are kept internally. However, you might find examples online from larger companies or templates from marketing businesses.

Most are online or in print, but there are exceptions. Coca-Cola did part of their 2020 marketing plan in the form of a video:

The one thing to remember is that the following examples should be used as guides, so don’t rigidly follow them. Each marketing plan will look slightly different depending on the needs, audience and aesthetic of your business.

Bear in mind that a lot of the examples below are stylised too. You can just create Word docs or Excel spreadsheets if that works for you.

Here are said examples. Your marketing plan could be made up of any or all of these things.

Executive summary

This is a rundown of your business and what it does. It also includes a bit of information on market need, target customer and what’s coming up of the firm.

Source: Shopify

Target customers

Source: Venngage

USP

Your unique selling point (USP) sets you apart from your competitors and re-establishes market need.

Source: Shopify

SWOT analysis

You may have come across SWOT analyses before. They look at strengths, weaknesses, opportunities and threats for your marketing to help drive your plan forward.

Source: Zapier

Competitor analysis

This can also help to drive your plan based on what your competitors are doing. Either filling in for their shortcomings or taking inspiration from what they do well.

Source: Venngage

Action programmes

This can be seen as an outline for what’s coming up, sometimes driven by your SWOT analysis. It’s generally one year up to five years, though it still needs to be reviewed regularly.

Source: Institute of Enterprise and Entrepreneurs

Budgets

This will give you an idea of how to get your plan into action and where you can move some money around.

Source: Smartsheet

There may even be sections that aren’t here that you feel are more fitting to your business and its marketing goals.

If you’re still flummoxed by the whole thing, then don’t worry – help is out there!

“There are lots of organisations and support that is available either at county level, or sometimes via various partnerships, like Enterprise Nation or your Chamber of Commerce,” said Dines. “There will always be someone nearby that you could maybe have a power hour with or get a grant to work with.”

Further reading

E-marketing made easy

The post How to write a marketing plan appeared first on Small Business UK.

What are some examples of sole traders? Here are six jobs that are ideal for anybody who wants to set up on their own offering a personal service, whether it’s fitness training, gardening, hairdressing, private catering, taking photographs or even walking other people’s dogs.

What surprising is how lucrative it can be.

Examples of sole traders – personal trainer

What kind of people make the best personal trainers?

Personal trainers are those fit looking people you see in gyms offering personalised exercise and nutrition plans. Becoming a personal trainer can be a great choice if you’re sporty and want to go into business for yourself as a sole trader.

Of course, you must have a passion for fitness, but many people become personal trainers as a second career or a side hustle or they have a supportive partner, who take the pressure on having to earn a high wage.

The people who do best as self-employed personal trainers are those who combine their passion for fitness with business acumen.

However, if you want to make it as a personal trainer, you need to be prepared to work long hours – the working day can start as early as 6am, be responsible for getting your own initial and ongoing qualifications, do your own marketing and manage your client diary.

Do I need a qualification to become a personal trainer?

The answer is yes. The minimum you need is a Level 3 Certificate in Personal Training and its prerequisite, a Level 2 Certificate in Gym Instruction. The good news is that you can be certificated in a number of ways, including full-time and part-time in person. Puregym Personal Training Academy offers an online-only 14-week course offering both certificates at the end.

Once you’ve got your certificate, you can start drumming up clients.

The next stage is a Level 3 certificate, which include sections on nutrition and running your own business.

Ross Mitchell, who trains personal trainers for PT training company Future Fit, says: “I always advise people to get their Level 3 because after that, the sky’s the limit.”

A Level 4 qualification includes working with people who have medical conditions such as diabetes and means you can be referred to by medical practitioners.

Do I need to be based in a gym?

Not necessarily. Some gym chains such as Puregym encourage freelance personal trainers to rent gym space, as do some independent gyms. Gyms will pay around £30-£35 per class if you’re a freelancer taking a fitness session.

Mitchell says: “My advice would be to work in a gym to start with. Working onsite will help you better understand people,and also help you understand where you want to go in the fitness industry.

“Being a personal trainer isn’t just about fitness. It’s about understanding your client’s personality, their struggles. Not everybody is as enthused about fitness as a newly qualified personal trainer.”

Or you could specialise in outdoor training, offering sessions in local parks. But if you go fully mobile straight away, you won’t have any clients, marketing or visibility. And even if you just set up in the park offering workouts, you may still have to pay your local council.

Other places where you can work as a self-employed personal trainer include:

• Office-based inhouse gyms
• Holiday resorts and hotels
• Cruise ships

Should I specialise in one type of fitness?

The short answer is yes, says Ross Mitchell, who compares having a fitness speciality to being a specialist surgeon as opposed to a general doctor.

Fitness specialisms that are currently popular include:

• Spinning
• YogaPilates
• Les Mills
• Hyrox
• F45

How much does it cost to become a personal trainer?

The National Register of Personal Trainers says that courses can cost anywhere from around £900 through to £5,000 for an intensive six-week course. To gain a full Level 3 qualification as a personal trainer, you can expect to spend up to around £2,500 as an average course price.

Do I need personal trainer insurance?

Specialist personal trainer business insurance protects you against potentially costly claims from clients if something goes wrong during a session. It also covers you if your equipment is lost, damaged or stolen, if you injure yourself when training or if an employee gets injured while working for you.

It’s so important that proof of specialist insurance is required by most gyms and sports centres before they allow you to work at their facility.

What types of insurance are required by law?

If you train with clients having public liability insurance is essential. This protects your legal liability if a claim is made against you for injury to another person or property damage. For example, you may need to claim if a client injures themselves during a session and holds you responsible or if you accidentally damage a facility you’re training at.

Professional indemnity insurance is also essential if you train clients – this covers you if a client injures themselves as a result of an exercise you’ve instructed and makes a claim against you.

It’s not just injury to your clients you should consider.

If you injure yourself while training, then you need personal accident insurance to cover potential physiotherapy or dental treatment costs. When you take out personal accident insurance, you can also get optional loss of earnings cover for up to 52 weeks in order to support you financially if your injuries mean you’re unable to work.

Another vital requirement of personal trainer insurance is equipment cover. If you transport your equipment to and from a fitness centre or a client’s home, you need equipment cover to protect it against loss, theft and damage. For instance, someone could break into your car and steal your equipment, or it could be damaged by an inexperienced client during a session. If these things happen and you don’t have equipment cover, you would have to pay for repairs or replacements out of your own pocket.

How much will I earn?

The average hourly rate charged by personal trainers is £30-£35, according to Puregym. In your first year, expect to earn as little as £10,000-£16,000; rising to £16,000-£20,000 in year two. fully fledged trainers earning anything between £25,000 and £60,000.

Some trainers who work with elite amateur athletes can charge up to £100 per hour for specialist training. Be warned though, if you’re thinking it would be cool to coach the next Dina Asher-Smith or Katarina Johnson-Thompson, famous athletes may pay you nothing – thinking it’s worth your while being associated with your brand for other lesser clients.

Ross Mitchell of Future Fit says that the attrition rate for people becoming personal trainers is high, mainly because people do not treat it like a business.

“Unfortunately, this is not Field of Dreams. If you build it, they will not come,” he says. “You have to put in a lot of effort.”

However, all it takes is for one of your workouts to go viral on social and you could become the next Joe Wickes.

>See also: What is a sole trader? A small business guide

Small Business Pro, our all-in-one solution, can save you time and money as well as offering peer support and the chance to win a monthly £2,500 grant. It will also help with the heavy lifting of managing customers, taking payments, insurance, finance and HR, plus you’ll get a host of personal wellbeing benefits.

You can find out more about Small Business Pro here.

Examples of sole traders – gardener

We know that anything outdoors is healthy. And, during the summer months, what could be better to be outside all day working in nature? And, for those of you who enjoy gardening, becoming a gardener is relatively low cost.

Do I need a qualification to become a gardener?

Mark Soanes of Urban Paradise spent 15 years in media working as an operational manager for companies including Virgin and Universal before being made redundant in 2016.

A keen amateur gardener, he decided to become a garden designer and landscape manager, doing a one-and-a-half year degree in garden design at the British Academy of Garden Design.

Soanes recommends taking a course before starting out as a self-employed gardener, such as those offered by the Royal Horticultural Society (RHS).

Soanes said: “A lot of people undervalue gardeners because there’s a lot to learn. It’s a lifetime learning process. You’re constantly learning by taking as many courses as you can, but everybody has to start somewhere.”

You can always join a gardening firm

Another route to becoming a self-employed gardener would be to join a bigger gardening firm by becoming a junior gardener. That way, you don’t have the outlay of setting up on your own and you should be partnered with another, experienced gardener who you can watch and learn from.

How much does it cost to set up as a gardener?

According to Fantastic Gardeners, would-be self-employed gardeners should budget for anything between £7,000 and £10,000 in set-up costs, including buying a van to transport tools, buying proper equipment and professional indemnity insurance.

What are my setting up costs?

• Tools – lawnmower, strimmer and hedge trimmer are essentials, as well as a spade, fork, shears, secateurs, loppers, lawnmower (best to have a battery-powered one), ladder, leaf blower, hedge trimmer, wheelbarrow, safety glasses, hosepipe, spray applicator, etc. Aim to spend at least £1,500 on gardening equipment.
• Van – for transporting tools and equipment
• Licences – you need a licence to operate a chainsaw, use pesticides or carry waste
• Website build and maintenance
• Uniform
• Bookkeeping software
• Professional indemnity insurance – costs as little as £70 a year

Where do I find clients?

By registering with the Gardeners Guild, you can list the services you offer. Full membership is currently just £45 a year (plus £10 initial registration fee). However, you must have at least one regulated horticultural qualification at Level 2 or above before being accepted for membership.

How much will I earn?

Professional gardeners work in blocks of three to four hours – otherwise it’s just not cost-effective factoring in travelling to and from jobs.

Gardeners can charge between £20-£50 an hour or a minimum £150 per day. This equates to anything between £15,000 and £70,000 a year, depending on how sophisticated a service you offer.

And, contrary to popular opinion, gardening and landscaping is a year-round job – there’s always something to be getting on with.

>See also: Can I switch a limited company to sole trader?

Examples of sole traders – hairdresser

One of the great things about being self-employed as a hairdresser is that you can grow into the role (sorry!). You can start out as a junior stylist and then work your way up, either working for a big city-centre salon or opening your own premises.

Or you can go completely mobile, visiting clients at home, while renting a chair in a salon for clients to visit you.

What qualifications do I need to be a hairdresser?

You can study hairdressing at college (such as a Level 2 or Level 3 Diploma or a T-level in Hairdressing, Barbering and Beauty Therapy – England only, from September 2023).

Or you could do an apprenticeship in a salon with a view to becoming a trainee hairdresser in a salon and learn on the job. Your employer will provide you with a certificate after you complete your apprenticeship. There are different levels of apprenticeship that will qualify you for different levels of National Vocational Qualification (NVQ) diplomas.

• Intermediate hairdressing apprenticeship (haircutting, shampooing, basic colouring, customer service) – qualifies for NVQ Level 2
• Advanced Apprenticeship (creative hairstyling, advanced colour, salon management) – qualifies for NVQ Level 3

Renting a chair

One of the benefits of being a self-employed hairdresser is that you can either visit clients in their homes or have them come to your home.

Another option is what’s called “renting a chair” where you rent a chair in a salon, either paying the owner a fixed daily/weekly fee or a percentage of takings when you are there. The standard percentage is around 40 per cent.

What equipment will I need?

• Scissors, combs, electric clippers
• Hair straighteners/curlers/wavers
• Hairdryer
• Protective floor covering
• Protective cape for client to wear
• Towels
• Sectioning clips
• Hair products (shampoos, conditioners/styling products/colours)
  What kind of insurance will I need to become a hairdresser?

What kind of insurance do I need?

Professional Beauty Direct offers self-employed hairdressing insurance starting at £42.50 a year. The policy is designed for self-employed mobile hair stylists and hairdressers, who either work from their home or visit clients, or rent a chair in a salon. The policy offers liability cover of up to £6m. You can add equipment cover as an additional cost.

The insurance package, which offers liability cover of up to £6m, includes:

Public liability insurance covers any injuries or accidents that may occur in your home or at your work premises, such as a customer stabbing themselves with your scissors.

Product liability insurance covers the products you sell to clients following a treatment, e.g. the products you used on them or aftercare products. This includes any allergic reaction to the product.

Treatment liability insurance covers claims made against you by a client if they experience illness or injury as a result of you providing a treatment

How much will I earn?

The average salary for a hairdresser is between £14,000 per year for a junior hairdresser and £30,000 per annum for a highly experienced hairdresser.

Examples of sole traders – private chef

What does a private chef do?

If you’ve ever watched MasterChef on TV, you will have noticed that many of its contestants go on to set up their own businesses as private chefs. And many of the MasterChef professionals are already working as a private chef.

Setting up as a private chef could mean you cater for one-off dinner parties or you’re called in to cater for glamorous country house weekends or even working for the rich and famous on yachts as an onboard cook.

However, be prepared for hard work: private chefs can work up to six days a week, covering everything from breakfast through to dinner, and then there’s the wiping down and washing up, which means up to 12-hour days.

Broadly speaking a private chef:

• Plans menus
• Shops for ingredients
• Prepares, cooks and often serves meals
• Clears away and cleans the kitchen

Do I need a qualification to become a private chef?

Many chefs go to a cookery school such as Ballymaloe, Le Cordon Bleu or Leiths to formally train and then start as a cook to gain experience.

Or they may start in a kitchen restaurant working their way up to sous chef before setting up on their own.

But there’s nothing to stop you from just going into business for yourself, if you’re passionate about your own food.

Gary Maclean, MasterChef winner and the national chef of Scotland, says: “A lot of people fall into it. The biggest draw is the freedom to develop your own food and do what you want. The chefs who go into it want to do their own thing without having a head chef over them. A lot of private chefs are enthusiasts who have never worked in a professional kitchen. My advice would be to give it a go but just start small.”

What skills do I need to be a private chef?

Maclean says that in addition to being able to cook, private chefs need to organised and good at planning a dinner party from start-to-finish.

“You need to be able to think on your feet,” he says, “as you never know what’s going to be thrown at you. It’s not as if you can reach for the store cupboard or the chiller, as you can in a professional kitchen.”

What equipment do I need as a private chef?

Maclean advises investing in your own kitchen equipment, as having top-quality tools really helps when it comes to producing and delivering a first-class dinner party. But the most important thing is to be passionate about what you’re doing, whether or not you’re already working in a professional kitchen and are offering dinner parties as a side hustle.

How much will I earn?

A live-out private chef can earn between £30,000 and £70,000 per annum. The average salary for a private chef is about £38,732 per year.

Examples of sole traders – photographer

What does a freelance photographer do?

In a way, we’ve all become photographers. All of us snap away on our iPhones to feed our Instagram accounts. If you’ve got a good eye, you might want to take things further and become a self-employed photographer.

There are plenty of niches you can specialise in as a freelance photographer:

• Event photography
• Fashion photography
• Food photography
• PR photography
• Product shots
• Property photography
• Social media images
• Sports photojournalism
• Stock photography
• Travel photography
• Wedding photography

Do I need qualifications to become a freelance photographer?

You’re not required to have formal qualifications, but certificates can reassure clients. In addition to studying photography at art school or university, organisations including the British Academy of Photography[TA1] , Royal Photographic Society and the British Institute of Professional Photographers all offer courses.

What equipment do I need to become a freelance photographer?

• Camera – recommended models include Canon EOS 200D, Nikon Z6, and the Sony Cyber-shot RX100 Mark IV
• Lenses – fisheye, wide zoom, macro, telephoto, etc
• Lighting – lamps, diffusers, reflectors
• Other equipment – tripod, memory cards, flash triggers, strobes
• Editing software – Adobe Photoshop and Adobe LightRoom are industry go-tos
• Computer – recommended models include , the Acer Predator Helios 500, 16″ MacBook Pro and the Dell XPS 15

How much can I earn as a freelance photographer?

According to Glassdoor, the average earnings of a freelance photographer is £31,336. If you’re starting out, the average hourly rate is £28.44 according to Indeed.

Examples of sole traders – dog walker

A total of 3.2 million households in the UK have acquired a pet in roughly the first year of the pandemic, according to the Pet Food Manufacturers’ Association.

According to the PFMA, there are 12 million dogs in Britain and all of them need walking, which was fine when people were stuck working from home and welcomed the break to have a trot round the local park, but not so easy now that people have gone back to the office — even if it’s for three days a week.

Enter the need for a dog walker.

However, it’s just not a question of if you like dogs, but also if you are physically fit enough to cope with long, arduous walks with, say, a Labrador Retriever in driving rain and mud.

If you’re fit and like jogging, some dogwalkers call themselves “dog runners” and specialise in high-energy breeds who like long runs.

On the other hand, even if you’re elderly or have a disability, you could still become a dog walker by making clear you can only handle toy breeds or elderly dogs. 

If you’d like to get more experience with dogs, you might consider volunteering at your local kennels or rescue centre first. It is important to understand how to actually walk dogs, putting big dogs in the middle of the pack and small dogs on the outside, for example, so they won’t get trampled.

Marilyn Lewis, support manager at NarpsUK, says: “The most important thing is to have experience. Get in touch with a local rescue centre and have hands-on experience of putting on a collar and lead and taking dogs for walks.”

What are the regulations around dog walking?

There aren’t many specific rules and regulations relating to dog walking businesses, however, professional dog walkers’ association NarpsUK advises that dog walkers should always meet the owner before walking a dog for the first time, keep records of all dogs and payments, and always protect customers’ information.

• It is advisable to walk no more than four dogs at a time
• Dogs must wear a collar that has the owner’s name and address on it
• Dogs must kept on a lead at all times on roads and pavements
• You could be fined up to £1,000 if you do not clean up dog faeces
• You must be in control of the dog at all times. It is against the law for a dog to be “dangerously out of control” in a public place. The Government has information on controlling your dog in public here
• It’s also a good idea to keep water and a first aid kit on you at all times in case one of the dogs in your care gets hurt

Do I need a qualification to become a dog walker?

City & Guilds offers professional qualifications a Level 2 Certificate of Technical Competence in Dog Walking here.

NarpsUK, the professional association for pet sitters and dog walkers which has a thousand members, offers a Pet Sitting and Dog Walking business course.

Marilyn Lewis, support manager at NarpsUK, says: “The course we offer makes it much easier for people who want to set up a professional dog walking business, such as providing readymade risk assessment forms needed by local councils or disclaimers for, say, dog owners who are happy for their hounds to be off the leash.”

Do I need insurance to become a dog walker?

Yes, this is mandatory to protect you and your clients. You must have public liability insurance in case the dog you are walking causes an accident or injures other dogs or people. A good add-on would be dog walking insurance that covers you if the dog has an accident itself or becomes sick while you are in charge.

If you use your car or home as part of your new dog walking business, you must tell your insurance company and an additional premium may be payable.

And, if your dog walking business takes off and you need to take on extra people help pooches pound the streets, then you should also take out Employer’s Liability Insurance.

You’ll need a criminal record check

If you’re holding a dog owner’s keys and going into their house, you’ll need a Criminal Record Check. For jobs in England and Wales you can request a basic Disclosure and Barring Service check for £23.

There’s a different application process if your business is in Northern Ireland or Scotland. You’ll need to have lived at your current address for more than a year to apply online with Disclosure Scotland for a Basic Disclosure, which costs £25. While for AccessNI, a basic check costs £18.

If you’ve lived at your address for under a year, you can apply for a Criminal Record Check through NarpsUK for £65.

How much does it cost to set up a dog walking business?

One of the great things about setting up a dog-walking business is that there are no start-up costs. You can bootstrap (or should that be “leadstrap”) your business with just one dog. In time, as you take more dogs out, you could get a van and buy crates, a ramp for dogs to climb into the van, signwriting on the side of the van, etc.

To begin with, you can advertise your dog-walking business for free by dropping off leaflets at local dog-grooming parlours, vets and with local dog trainers.

• You’ll need to buy extra harnesses and leads and toys to keep dogs amused
• Setting up a website advertising your new business makes you look professional
• You need to allow £150 for insurance and criminal record checks
• Spend £250 on flyers and business cards and a local newspaper advert

How much will I earn?

The amount you can earn as a dog walker is based on your location. If you are in a well-heeled neighbourhood such as the London suburb of Richmond, dog walkers charge £25 per dog for each walk. Setting up a dog-walking business is more likely to be successful in a town or city.

The average UK hourly rate for dog-walking is £10-£25 for walks that last between 30 minutes and an hour. The median hourly rate is £15 per dog walk and NarpsUK members typically walk around 12 dogs per day. In 2015 Direct Line Pet Insurance published a survey suggested that a reasonably busy dog walker could earn £26,000 a year.

Another element can be home boarding, where owners leave their dogs in someone else’s home when they go abroad as opposed to kennels. You can charge anything between £25 and £30 per dog per night for overnight stays.

More on sole traders

Best business bank accounts for sole traders

The post 6 examples of sole traders appeared first on Small Business UK.

Starting a new business can be a daunting prospect, with numerous issues to overcome in order to ensure the smooth transition from fledgling entity to a successful, profitable company. Taking your first commercial premises can be an integral part of this process, bringing its own challenges and obstacles.

Taking commercial space is an exciting step for any business, but it’s unfortunately very easy to make mistakes that could cost the business dearly in the future. Not knowing how to negotiate a commercial lease is stressful for any business owner. However, with the right advice, entrepreneurs can avoid common pitfalls, securing a deal that’s right for their business, with the appropriate safeguards necessary for an ambitious start-up:

#1 – Do your homework and avoid hasty decisions

The first goal is to identify the property that is right for your business – there is a whole host of criteria to consider, some more obvious than others. As well as location and sq. ft. it’s worth taking the time to speak to any other occupiers about their experience. We often speak with business owners who have failed to dig deeper than the façade and the information they’re presented with – you could be avoiding an expensive ordeal down the line.

#2 – Negotiate a comprehensive set of terms

Once a property has been identified, the agent will assist in helping you negotiate a commercial lease. The negotiation of a set of “heads of terms” (a document prepared at the outset of a transaction outlining the terms agreed between the parties) is imperative and is the opportunity for you to negotiate the best deal available.

It’s vital that any requirements you have are factored in at this point (key elements typically might include the lease duration, rent amount, rent escalation clauses, maintenance responsibilities, and any special provisions or concessions) as otherwise it will be much more difficult to negotiate additional elements once terms have been finalised and lawyers instructed.

#3 – Consider which entity is to take the new lease

The entity which takes the new lease will be “on the hook” for all the associated tenant liabilities, including payment of rent, the service charge and ancillary payments, plus any liabilities for dilapidations and such matters. With this in mind, you should also consider as to whether to take the lease in a newly incorporated limited company, rather than – in the case of a sole trader – your own name. This will avoid being held personally reliable for such obligations.

>See also: Five things to consider when converting a property for commercial use

#4 – Push for a rent-free period/appropriate rent incentive

Depending on the desirability of the property, levels of interest and current market trends, tenants are often able to negotiate a rent-free period or associated rent incentive (for example, a period where they will pay a “half rent”) in lieu of the fact that they may need to fit out the property.

Your instructed agent will be able to advise on the likelihood of negotiating such an incentive, however it is certainly worth asking the question – where possible you want to avoid paying rent when you are still fitting the unit out.

#5 – Flexibility, termination and ability to ‘deal’

As a start-up entity, you have no way of knowing in which direction your new business will go. You may find that the business grows rapidly and that you quickly require bigger premises to support such growth. Conversely, you may find that things do not go so well, and that you no longer require as much space or wish to terminate the letting in its entirety. As such it is important to retain as much flexibility as possible. It is advisable to try and negotiate a break clause, either a tenant only break right at a specific point (for example, after three years of a five-year lease term) or better still, a rolling break right, which gives you the ability to terminate at any time after a given date.

It’s also important to consider how you’re permitted to “deal” with the lease. If the property is potentially divisible, it is certainly advisable to try and negotiate the ability to sublet part to a third-party tenant, which would then enable you to “hive off” part of the unit and recover some of your liabilities in relation to it.

#6 – Consider repairing liabilities and protect against onerous obligations

You need to be sure that you are not signing up to lease with an overly onerous repairing liability. To protect against this, it is important, where a property is not in full repair, that you always seek to agree a schedule of condition to be attached to the lease. This shows the state of repair of the property at the date you take your lease, with an associated lease clause, meaning you’re only obliged to put the property back into the state of repair as evidenced by the schedule.

#7 – Consider reinstatement when making alterations

Typically, commercial leases allow tenants to make internal non-structural alterations with landlord’s consent, and often allow the erection of internal partitioning without the need to obtain consent at all. It is important to ensure that where fit-out works are required in order to operate from the premises, landlord’s consent is obtained as part of the initial transaction and that you don’t end up picking up the tab for the landlord’s legal costs in preparing a licence to document such consent.

Always bear in mind that landlords will in likelihood require you to reinstate the premises at lease expiry. This is particularly important to bear in mind where works are significant as removal will be at your cost.

#8 – Seek to agree a cap on additional charges

If, for example, you are taking a lease of a multi-let building, there will likely be common areas and you will in all likelihood be required to contribute toward the cost of maintenance/insurance of the same. Where possible, it is advisable to try and cap such contributions at a fixed figure, so that you know your liability cannot go above that figure. As a start-up business, it’s imperative to keep strict control of your costs and clearly you want to avoid any unexpectedly high liabilities.

#9 – Be aware of SDLT and additional post completion costs

Depending on the length of term and annual rent you agree for the property, it is possible that the lease will generate a stamp duty land tax liability. Normally, SDLT kicks in on lease premiums / transfer values or ‘Net present value of rent’ when these costs rise above £150,001. There are exemptions available, but it is a complex subject and as such it’s important that you take professional advice on these possible liabilities in order that you can factor them in when working out your costings.

In addition, if your lease is over seven years in length it will require registration at the Land Registry, for which there is a registration fee payable.

#10 – Take professional advice

We would always recommend that you instruct a competitive and reputable commercial solicitor who will ensure that these points (and more) are picked up during the negotiation process and that your interests are properly protected.

Summary

Negotiating a commercial lease agreement is a crucial process for businesses seeking space for their operations which can significantly impact a business’s bottom line and operational flexibility. Businesses should carefully review and understand the lease terms, seek legal counsel if necessary, and consider factors such as location, space requirements, and budget constraints. Successful negotiations can lead to a lease agreement that suits your business’s needs and goals, while also helping to mitigate potential risks and disputes during the lease term.

The above points provide a broad flavour of the key elements that need to be considered when you want to negotiate a commercial lease.

Simon Maddox is a real estate partner at JMW Solicitors

Further reading

What to consider when choosing a commercial property

The post How to negotiate a commercial lease – tips for negotiating with a landlord appeared first on Small Business UK.

Setting up as one of the UK’s 3.1 million sole traders, you may have lots of questions around which business bank account is best for you.  

You will need to consider cost, free banking period (if there is one), overdrafts and integrations.  

We’ll be looking some of the best business bank accounts on the market targeted specifically at sole traders.

Compare business bank accounts now with this quick form.

Traditional banks

High street banks do offer sole trader accounts and they tend to have a free banking period, which is a huge bonus if your business is new and you’re trying to cut costs. Take a look at the summary below.

HSBC

HSBC has two options for sole traders and single directors of limited companies. 

Packages

HSBC Kinetic (Free for 12 months, £6.50 thereafter)

HSBC Kinetic is a mobile business banking app which is best for sole traders. You can apply in minutes through the app. Note that this will need a credit check.

This smartphone app-based business account is available for either Android or iPhone users.

• Make payments of up to £25,000 per day in-app
• Automatically categorised transactions to help monitor spending
• Credit card and savings account (subject to eligibility and application)
• Insights that could help you manage your money better

Small Business Banking Account (Free for first 12 months, £8 per month thereafter)

The HSBC Small Business Banking Account is a more traditional small business bank account from HSBC, aimed at sole traders and limited companies with turnover of up to £6.5m.

• Loans from £1,000 to £25,000
• Arranged overdraft
• Visa commercial card – no annual fee for the first year
• Access to secure digital banking including the ability to scan and deposit your cheques via the Business Banking Mobile app
• Syncs with Sage accounting software
• International payments for over 60 currencies

Compare HSBC business banking on NerdWallet

TSB

TSB’s Business Plus account has 30 months of free business banking for sole traders, partners and directors. It doesn’t matter if you’re switching or are opening a brand-new bank account.

Package

Business Plus Account (30 months free, £5 thereafter)

• Deposit cash and cheques in Post Office branches as well as TSB branches
• Add a business debit card to your account
• Business advice and support through Enterprise Nation for 12 months.

Co-op Bank

The Co-operative Bank offers the Business Current Account, which is ideal for sole traders who don’t often bank with cash or cheques.

Package

Business Current Account (No account fee)

• No additional cost to deposit cash at the Post Office
• Payment app, Go Get Paid, lets you automate your financial admin
• Integrate your accounting software like Xero, Sage or Quickbooks within your online banking    
• Free support tools such as webinars and start-up guides

Compare The Co-operative Bank business banking on NerdWallet

Barclays

Barclays start-up business account is the bank’s best offering for sole traders.

Package

Start-up Business Account (Free for 12 months, £8.50 a month thereafter)

• Free invoicing and account software from FreshBooks, worth £228 a year
• Expert advice from Barclays’ Business Direct team in the early months to help you grow
• Pay in cheques using the Barclays app

Metro Bank

Metro Bank has a simple Business Bank Account open to sole traders with under £2m turnover.

Package

Business Bank Account (£6 a month; free if your balance stays above £6,000)

• Local Business Manager as a key point of contact, but all colleagues can support you with day-to-day banking
• Store opening 7 days a week
• Transaction and service charges apply

Compare Metro business banking on NerdWallet

Virgin Money

The Virgin Money M Account is designed for businesses with less than £1m in turnover. There’s no monthly charge on the account. However, there will be a 95p charge for manual debit and credit payments – that is, transactions you have to do in-store.

Package

M Account (£0)

• Cash cheques digitally
• Use with Apple Pay and Google Pay
• Set up weekly balance and transaction alerts as you like

Compare Virgin business banking on NerdWallet

Digital banking platforms

Newer players to the game have their own products which are generally quicker and easier to set up and are operated online.

Tide

With Tide, you’ve got three different account options geared at sole traders and freelancers that can scale with your business.

Packages

Free (£0)

• Accounting integrations including QuickBooks, Xero, Quickbooks, Xero, Sage and more
• Multi-business – hold up to five accounts
• Create and send invoices for free

Plus (£9.99 per month plus VAT)

All of the features of Free, and:

• One free expense card for your team
• Priority in-app support

Pro (£18.99 per month plus VAT)

All of the features of Pro, and:

• Unlimited transfers in and out
• One extra expense card included

Cashback (£49.99 per month plus VAT)
All of the features of Plus, and:

• 0.5 per cent cashback on your Tide card
• Dedicated team of account managers

Compare Tide business banking on NerdWallet

Starling Bank

The Starling Bank business account is open to you if you’re a sole trader or the owner of a limited company, a limited liability partnership or if you’re part of a limited company with multiple owners.

There’s no monthly charge on the account and it comes with an overdraft. To boost your business’ functionality, you can opt for the Business Toolkit for £7 a month.

Packages

Original free account (£0)

• Connect to Quickbooks, Xero or FreeAgent
• 24/7 UK support
• Free UK transfers

Business Toolkit (£7 per month including VAT)

Everything in the Original free account, and:

• Invoices and auto-matching
• Tax estimation (for sole traders only)
• Making Tax Digital VAT submission

ANNA Money

ANNA Money is open to any UK resident who is a sole trader.

It takes three minutes to set up and you’ll get a personal webpage with a link to put on your online profiles or to send to someone directly. You can give your employees their own debit card with a spending limit and it’ll sort out their expenses automatically. It also has a receipt capture feature that ANNA automatically categorises and stores digitally.

You can set up free direct debits as well as scheduled and recurring payments.

There are two packages which are more suitable for sole traders, particularly those in the early stages. A Big Business package is also available at £49.90 a month + VAT with unlimited local transfers and ATM withdrawals. See full prices here.

Packages

Pay as you go (£0 per month)

• Free card in any country and currency
• 1 per cent currency conversion fee
• 20p per local transfer in and out of your account

Business (£14.90 per month plus VAT – first month free)

• Pay in cash with one per cent commission
• One additional debit cards included, then £3 per card per month

Compare ANNA Money business banking on NerdWallet

Coconut

Coconut is geared specifically at sole traders but is open to limited companies with too. It has the functionality to handle banking, bookkeeping, invoicing and tax. Sole traders can an extra help up with tax reports to help them with their self-assessment.

Package

Monthly plan (£9 including VAT)

• 30-day free trial
• Sole traders can add their personal account on to their business bank account to separate into personal and business finances
• Connect current accounts and credit cards from 25+ different banks including Barclays, Lloyds and Starling
• Notifications when payment has been made or received, automatic categorisation
• See calculations of how much tax you’ll owe and tips on what expenses you can claim

Revolut

Revolut is a good shout for business owners who travel and trade overseas. Customers can hold, exchange and transfer over 25 currencies with the real exchange rate.

You can issue physical and virtual cards and track your employees spending in real time. Integrations including Zapier and Slack and accounting software like Xero, Sage, FreeAgent, QuickBooks and FreshBooks.

Packages

In terms of accounts you’ve got:

Free (£0 a month)

• Five free local payments
• Free transfers to Revolut accounts
• Local accounts in GBP

Grow (£19 a month)

Everything in Free package, and:

• Five free international payments
• 100 free local payments

Scale (£79 a month)

Everything in Scale, and:

• 25 free international payments
• 1,000 free local payments

For freelancer accounts, there are three packages:

Free (£0 a month)

• Five fee-free local transfers
• No-fee transfers to Revolut accounts
• SWIFT account details

Professional (from £5 a month)

Everything in the Free package, and:

• Bulk payments
• 20 no-fee local transfers
• £5,000 currency exchange at the interbank rate

Ultimate (from £19 a month)

Everything in the Professional package, and:

• Five fee-free international transfers
• 100 no-fee local transfers
• One complimentary metal card

Compare Revolut business banking on NerdWallet

Monzo

Monzo has a couple of low-cost options depending on your business needs.

Accounts aren’t available to some types of businesses but this may be reviewed in future.

Packages

Lite (£0)

• Integration with Xero, FreeAgent and QuickBooks
• Instant notifications

Pro (£5 per month)

Everything in Lite, and:

• New Xero users can get six months of Xero free
• Tax Pots – set aside a percentage of your earnings to put towards tax every time you’re paid

Compare Monzo business banking on NerdWallet

Amaiz

With Amaiz, your account is protected by smart security features including biometric verification, transaction monitoring and fraud detection. Plus, you can make payouts in more than 70 currencies and customise your banking statements. Instant invoices and payments will make your finances easier to handle too.

Packages

Business (£0 a month – VAT may apply)

• Free onboarding

Business+ (£49 a month – VAT may apply)

• £100 onboarding fee

Enterprise (£99 a month – VAT may apply)

• £250-£1,000 onboarding fee

Mettle

Mettle is part of NatWest but is an independent arm. You’ll be eligible if you’re a sole trader, though you must have a balance of less than £50,000 to apply.

Mettle is free to use and free to join.

Package

Mettle (£0)

• Match payments to invoices
• Easily categorise your transactions
• Set aside a set percentage each month to put towards tax with Tax Pots
• FSCS protected
• Get FreeAgent free of charge, saving you £150 a year

Compare Mettle business banking on NerdWallet

Can I use a personal account as a sole trader?

In some cases you can, but it is helpful to have a business bank account for a number of reasons. It’ll be easier to split your business and personal expenses, for starters.

Business bank accounts have greater functionality such as cashing cheques into your account and it’s easier to manage expenses and do your tax return.

A business bank account will build a credit rating for your business so that you can access loans and other financing that you may need later down the line.

Bear in mind as well that some banks simply won’t let you have a personal account for your banking, even if you’re a sole trader. They might even close your account if they cotton on that you’re using your personal account for your business.

The best part? Business bank accounts often offer handy freebies like free accounting software or a free 12 months of banking, for example.

Looking for the latest deals? Compare UK business bank accounts with Nerdwallet here.

More on being a sole trader

Employing people as a sole trader

The post Best business bank accounts for sole traders appeared first on Small Business UK.

As part of the Government’s pledge to reach net-zero by 2050, almost £5bn has been put aside to help UK businesses become greener. There are small business energy grants covering everything from installing heat pumps and electric car charging points through to adding solar panels or just insulating your building.

These are available either nationally, regionally or at local authority level, so check out our list below.

Where to find green small business grants – If you fancy making your business and its operations that bit greener, these eco grants will help you get there

United Kingdom

Workplace Charging Scheme

The Workplace Charging Scheme (WCS) is a voucher-based scheme that provides eligible applicants with support towards the upfront costs of the purchase and installation of electric vehicle (EV) charge points.

It is available in England, Wales, Scotland and Northern Ireland, but not in the Channel Islands or Isle of Man.

The grant covers up to 75 per cent of the total costs of the purchase and installation of EV charge points (inclusive of VAT), capped at a maximum of:

• £350 per socket
• 40 sockets across all sites per applicant – for instance, if you would like to install them in 40 sites, you will have one socket available per site

After applying using the online application form, successful applicants are issued with a unique identification voucher code by email, which can then be given to any OZEV-authorised commercial charge point installer.

England and Wales only

Boiler upgrade scheme

What is it? With this scheme, you can get a grant to cover part of the cost of replacing fossil fuel heating systems with a heat pump or biomass boiler.

£450 million of grant funding is available over three years from 2022 to 2025.

You’re eligible if:

• Own the property you’re applying for (including if it’s a business address)
• Be replacing fossil fuel heating systems (such as oil, gas or electric)

How much? You can get one grant per property. Grants are available for:

• £7,500 towards an air source heat pump
• £7,500 towards a ground source heat pump (including water source heat pumps and those on shared ground loops)
• £5,000 towards a biomass boiler

Your property must have a valid Energy Performance Certificate (EPC) with no outstanding recommendations for loft or cavity wall insulation.

How to apply

• Contact suitable MCS certified installers to get quotes for the work
• Confirm you’re eligible (your installer will tell you)
• Agree a quote with your chosen installer
• The installer will apply on your behalf on the Ofgem website

The value of the grant will be taken off the amount you pay for installation.

Solar panel grants for businesses – If your business uses solar panels, you can generate cash from National Grid suppliers for the energy you produce and do not use

England

Birmingham

Commercial vehicle grant

What is it? This £10m grant scheme aims to help small businesses based within the Birmingham Clean Air Zone (CAZ), wider Birmingham and West Midlands region to meet European standards.

Who can apply? You must have been trading for more than 12 months and own or lease heavy goods vehicles or light good vehicles that are not complaint with CAZ emission standards. You must also be able to demonstrate your use of clean air zones through your commercial operations.

How much? The total grant package for each business is up to £180,000 – that’s up to £15,000 per heavy goods vehicle and up to 35 per cent of the maximum cost of an upgrade up at a maximum of £4,000 for each light goods vehicle.

How to apply You can find out more and register here.

Derbyshire

Green Entrepreneurs Fund

Green Entrepreneurs Fund helps businesses, organisations, communities and individuals interested in developing skills in the green economy and investing in green energy and carbon reduction schemes.

Green Entrepreneurs Small Grant Fund

Grants of between £6,000 to £20,000 are available for proposals for alternative energy, clean fuel and carbon reduction projects.

To be eligible, projects must have a minimum spend of £15,000 and there is a maximum intervention rate of 40 per cent. A total of £500,000 has been set aside for this fund.

Green Entrepreneurs Demonstrator Grant Fund

£1.2m has been earmarked for a small number of high-quality, larger scale carbon-cutting projects in Derbyshire. This fund is open to larger scale projects that are designed to encourage solutions beyond the mainstream of current thinking.

The maximum grant available through this fund is £200,000.

Green Entrepreneurs Scholarship Fund

This fund will support individuals to retrain with skills to enable them to enter the field of low carbon, green energy. Individuals can access up to £1,500 for training costs. £100,000 has been set aside for this fund.

The scholarship grants will allow individuals to study around their existing responsibilities. It will enable them to obtain the skills and qualifications they need to change their career or progress in employment. The study can take place either online or face to face or a combination of both.

Applicants are encouraged to contact the careers service and discuss their plans before applying for a green entrepreneur programme scholarship grant.

East Sussex

Energy efficiency grants for East Sussex businesses

What is it? An SME may apply for a grant between £200 to £1,000 to cover a maximum 40 per cent of the total value of their energy efficiency project through the Sustainable Business Partnership CIC.

The minimum grant amount you can apply for is £200 with a total project spend of at least £500

Who can apply? The grant is available to any business, social enterprise or charity that:

• Has fewer than 250 full time equivalent employees
• Has a turnover less than £44m
• Is not owned by a group or company that does not meet the above two criteria

To apply for a grant the SME must also have:

• A premises in East Sussex (excluding Brighton & Hove) where the energy efficiency project will be installed
• Received an energy audit to identify energy saving measures; provided through the LoCASE project, or through a similar scheme or a private supplier.

How to apply You can download an application form below.

Download Application Form

To apply for the grant please email your completed application form and supporting documents to info@sustainablebusiness.org.uk.

Greater Manchester

Carbon Reduction Grant

What is it? SMEs in Greater Manchester may be eligible for grants between £2,000 and £25,000 (before VAT) to cover up to 50 per cent of the cost of energy efficiency improvements up to a maximum grant of £12,500.

The Carbon Reduction Grant is available for a limited time on a first-come-first-served basis and can go towards, for example:

• A new LED lighting system for your premises
• Heating equipment upgrades
• Replacement drives or motors
• Process efficiency investments

How to apply If you’re eligible, fill out the form in the link here

Norfolk and Suffolk

Business Transition to Net Zero Grant

What is it? The Business Transition to Net Zero Grant is aimed at businesses in Norfolk and Suffolk with ambitions to reduce their carbon footprint and increase productivity.

Grants between £25,000 and £100,000 are available, covering up to 20 per cent of the cost of the development. To be awarded the minimum of £25,000, you must show total project costs of at least £125,000.

What it covers The scheme funds capital development, such as those which make use of clean and/or renewable energy production and the recycling of goods and materials, rather than the installation of LED lighting or the supply or installation fo solar panels.

Who can apply Businesses based in Norfolk or Suffolk that have at least two years’ worth of accounts.

How to apply Contact New Anglia Growth Hub

Nottinghamshire

Workplace Travel Grant

The Workplace Travel Grant offers small businesses in Nottingham up to £25,000 financial support to help meet the costs of workplace travel improvements such as electric vehicle charge points, cycle parking, showers, pool bikes, car sharing and car parking management.

Businesses in Nottingham have until 31 December 2023 to apply here.

Worcestershire

Net Zero Worcestershire

What is it? Grant funding available to help SMEs in Worcestershire to implement energy saving initiatives including LED lighting, heating and insulation and renewables.

How much?

Bromsgrove: £1,000 to £10,000

Malvern: £1,000 to £8,000

Redditch: £1,000 to £10,000

Worcester: £1,000 to £5,000 (revenue grants only)

Wychavon: £1,000 to £5,000

Wyre Forest: £1,000 to £10,000

Net Zero Worcestershire grants are awarded on a match-funded basis, meaning the SME will need to provide at least 60 per cent of the total cost of the project.

What can the grant be used for?

The grant can be used to fund a variety of business activities, including, but not limited to:

• lighting
• compressors
• insulation
• fast-shutting doors
• renewable technology
• heat recovery
• heaters and boilers
• energy efficiency equipment that leads to process improvements
• energy management

How to apply Email grants@worcestershire.gov.uk

Yorkshire

Hull Business Energy Efficiency Scheme

Funding of up to £15,000 for SMEs based in Hull towards replacing inefficient systems and equipment, and installation of new smart systems to help save energy.

• Lighting
• Heating
• Solar panels
• EV chargers

How to apply You can apply here.

Scotland

East Ayreshire

Net Zero Grant

The East Ayrshire Net Zero Grant provides up to 50 per cent funding, up to £3,000, to support local businesses to transition towards net zero carbon emissions and also help offset the current rises in energy costs.

The fund is intended to help small to medium-sized businesses (SMEs) to implement energy and resource efficiency improvements. It can be used for:

• The purchase of equipment that would contribute to energy saving
• Green skills training
• Renewable energy installations (for example, solar, ground or air source heat pumps)
• Waste management or recycling
• Lighting systems
• Roof and building insulation
• Low energy heating

To be eligible, a business must:

• Have been trading for at least 12 months
• Employ between three and 49 people
• Be working with Business Energy Scotland or the University of Strathclyde
• Have completed a business energy efficiency audit and created a carbon reduction plan

Falkirk

Energy Efficiency Fund

The Falkirk Council Energy Efficiency Fund can provide grants to cover up to 50 per cent of your project costs, with a maximum of £10,000 per grant. The minimum grant value is £1,000, which means your project must cost at least £2,000.

The fund can be used to make changes to business premises and business operations to reduce their carbon footprint from energy consumption. This might include:

• Changing to a low carbon heating system
• Installation of low and zero carbon generating technologies, such as solar PV, biomass and micro-wind
• Building fabric upgrades such as insulation, energy-efficient lighting, draught-proofing, double or triple glazing

Before you begin your application, you will need a record of:

• The trading name of the business
• The number of employees, your turnover and export sales (where applicable)
• The proposed expenditure
• Your business bank details
• The rateable value of your premises – this can be found on www.saa.gov.uk
• A copy of your lease if you are paying non-domestic rates for the premise
• Your latest set of accounts and management accounts, as well as a business plan (or mini business plan)
• Two quotes for each item being purchased
• A calculation of your baseline carbon footprint
• The projected emissions reduction from this investment

Glasgow

Green Business Grant

The Glasgow City Council Green Business Grant will help businesses in Glasgow address both the cost of living and climate crises through measures such as energy efficiency, renewables, active travel and waste management.

The Green Business Grant is worth up to £10,000, which will cover up to 50 per cent of the total cost of a project. Projects can include anything that helps businesses reduce their energy bills and make progress towards achieving net zero carbon emissions.

To be eligible for the grant, your business must:

• Be a small or medium-sized enterprise (as defined in the Companies Act 2006)
• Have been trading for at least six months
• Own its own premises in Glasgow or have written permission from your landlord to make changes to the premises and seek planning permissions from Glasgow City Council Planning Division to implement the works detailed in your application
• Have a Glasgow postcode and pay non-domestic rates in Glasgow
• Be headquartered in Glasgow

Premises of an organisation based outside Glasgow will not be considered. Businesses whose main base is within the city boundary cannot use the grant to improve premises or create jobs outside Glasgow.

Businesses that are owned by another business with more than a 25 per cent stake are not eligible.

The grant will close to new applications on 20 December 2024 or when the budget is fully allocated, whichever is earlier.

West Lothian

Low Carbon Energy Efficiency Grant

The Low Carbon/Energy Efficiency Grant is worth up to £10,000 for West Lothian businesses that are looking to:

• Overcome barriers to reducing their carbon emissions
• Implement new business processes that will help reduce carbon emissions
• Implement strategic changes identified through consultancy support
• Promote their green credentials
• Enter a new market in the net zero landscape

Your business must also:

• Have at least five employees
• Have been trading for at least one year
• Have growth potential over the next three years

Perth & Kinross

Green Recovery Capital Development Grant

Through the Green Recovery Capital Development Grant, Perth and Kinross Council has made funding of up to £25,000 available for businesses that were financially affected by Covid-19, with preference given to projects which involve green initiatives to reduced your business’s carbon footprint.

• Replacement windows
• Solar panels
• Vehicle charging points

This fund offers grants of up to £25,000 to cover up to 50 per cent of eligible costs. Projects must involve a minimum spend of £10,000, which means that businesses must match the funding with at least £5,000.

The grant will not be awarded upfront immediately after approval – instead, you will receive payment after you make your purchases and submit receipts or invoices. This means that initially you must be able to afford the project’s full cost until you are refunded.

Priority will be given to projects that reduce the carbon footprint of your business. Applications must be submitted before 28 February, 2024.

East Renfrewshire

SBA Get to Zero Grant

The SBA Get to Zero Grant provides funding for businesses to improve energy efficiencies or purchase more efficient equipment.

Grant applications under £10,000 will receive up to £5,000 funding. Grant applications over £10,000 will receive a maximum 50 per cent funding up to a maximum grant total of £10,000.

Measures could include:

• Low energy heating and lighting systems
• Improved insulation for roof and building
• Solar, ground or air source heat or solar thermal technology
• Waste management or recycling
• Equipment that demonstrates a significant energy saving through its installation

Wales

Cadwyn Clwyd

Community Innovation Denbighshire

Led by Cadwyn Clwyd and Denbighshire Voluntary Services Council (DVSC), the £600,000 Community Innovation Denbighshire project will focus on encouraging micro firms and others to deliver environmental benefits.

Supported by Denbighshire County Council and part-funded by the Government through the £220m UK Community Renewal Fund, support is available for 25 organisations or individuals who can apply for a £5,000 grant they will match-fund to trial new products, systems and services.

Business Wales will also be on hand with guidance and advice throughout the process.

For more information, email admin@cadwynclwyd.co.uk or call 01490 340500.

Carmarthenshire

Business Renewable Energy Fund

Business Renewable Energy Fund offers grants of between £1,000 and £25,000 towards the cost of buying a renewable energy system. Each grant will be based on no more than 50 per cent of eligible costs.

Eligible businesses include:

• Advanced Materials and Manufacturing
• Construction
• Creative Industries
• Energy and Environment
• Finance and Professional Services
• Information Technology and Telecoms
• Life Sciences
• Food & Drink
• Tourism
• Retail
• Care

The grant can be used for:

Power Systems

• Small scale, single wind turbine
• Solar photovoltaic panels (roof mounted/ ground mounted)
• Solar photovoltaic battery
• Grid linked battery storage system (where the tariff is with a renewable energy supplier)
• Hydro-electric

Heating Systems

• Air Source Heat Pump (Air to water and air to air)
• Ground Source Heat Pump (vertical, horizontal, diagonal & radial)
• Solar thermal panels (roof mounted/ ground mounted)

More on small business energy grants

150 UK small business grants to apply for right now – UPDATED – In need of some funding for your small business? These grants should give you a boost, wherever you’re based in the UK.

The post Small business energy grants – what’s available appeared first on Small Business UK.

A look at the key options available when it comes to funding your business. What do they involve, and which is the best fit for various types of businesses?

Businesses today face numerous economic challenges, including the cost-of-living crisis, record-breaking inflation levels, skills shortages and increased pressure to maintain a healthy profit. Some of these challenges are already placing a squeeze on firms’ cash flow but now with interest rates also on the rise, the cost of borrowing – for consumers and companies alike – has increased.

>See also: Raising start-up capital – who to turn to?

The good news is that if your business wants to strengthen its financial position or capitalise on changing market conditions to accelerate growth, you do still have plenty of funding options available.

You can jump straight to a particular funding type or read on to find more info on the 6 best funding options for growth.

1. Debt funding
2. Venture debt
3. Equity funding
4. Invoice finance and discounting
5. Growth loans
6. Working capital

Small Business Pro will help with the heavy lifting of managing customers, taking payments, insurance, finance and HR, plus you’ll get a host of personal wellbeing benefits.

You can find out more about Small Business Pro here.

#1 – Debt funding

Debt funding is when a business raises capital via a loan, usually from a bank or another lender. Over the term of the loan, the borrower is expected to pay back the full amount, as well as any interest that is accrued – much like a personal loan.

Usually, raising capital in this way does not affect the overall ownership of a business, meaning the lender would have no influence in how your business is run day-to-day, which is the key distinction between this type of funding and equity finance.

Raising capital via debt is therefore a good option for business leaders that do not wish to dilute equity – or for businesses that have already raised equity capital and need to raise more cash, but do not want to dilute equity any further.

It is also a good option if your business is fast-growing or has recurring revenue. Fast growth firms often have high upfront costs, such as employee overheads and product development and need additional working capital to take their business to the next level. Debt funding will give you access to the capital you need to accelerate this growth and you can then repay the loan, plus the interest, as your revenue grows.

Likewise, the nature of businesses with strong recurring revenue makes them a good match for debt lenders, as there is clear visibility on the serviceability of the loan.

#2 – Venture debt

Venture debt is a specific type of debt funding aimed at earlier-stage businesses – this is often a good match for firms that are pre-profitability but can demonstrate a clear plan as to how they will get there.

Often these businesses do not meet the eligibility criteria for traditional loans, so the cost of venture debt is usually higher to encompass the increased risk to the lender, but by working with a specialist venture debt provider, you are more likely to find a tailored solution that fits your particular growth needs.

#3 – Equity funding

Equity funding can be provided through a variety of mechanisms, including private equity, venture capital and angel investors. The fundamental difference between debt and equity funding is that the latter involves divesting equity; in exchange for an agreed sum, the investor will take a percentage ownership of your business.

The benefit of equity funding is that because the investor receives upside in the form of equity, your business does not need to make regular repayments, or pay interest, which makes it a great way of raising capital with minimal impact on cash flow.

Equally, for less mature or less established businesses, you get the benefit of the investor’s experience, which, depending on the investor you choose to partner with, could be incredibly valuable in developing your business strategy.

Crowdfunding

Crowdfunding can also be a form of equity finance – you just sell a percentage stake in your business to multiple people, rather than to a single investor or institution.

For businesses that are just beginning their growth journey, equity crowdfunding can be a lower-risk way of raising capital, but this all depends on how comfortable you are selling a stake in your company. If equity dilution is not for you, there are many other funding options that will be more suitable.

>See also: Crowdfunding UK small business: everything you need to know

#4 – Invoice finance & discounting

If your business relies on invoice payments as its main source of income, it may be among the 36 per cent of UK SMEs which wait between 30 and 90 days to get paid. These long payment terms can play havoc with cash flow and leave very little left over to reinvest in growth or business expansion.

Invoice finance

Invoice finance solves this problem, enabling businesses to secure an advance on unpaid invoices – usually between 80-90 per cent of the invoice value. This puts the outstanding capital back in your hands so that you can spend it however you see fit.

Most lenders will offer a range of invoice facilities. Selective invoice finance, for example, enables businesses to secure funding on an invoice-by-invoice basis, meaning you can pick and choose the invoices you advance and essentially pay as you go with the associated fees.

Invoice discounting

Invoice discounting on the other hand, enables a business to leverage a larger amount of cash by advancing funding on a pool of invoices or debtors. This type of invoice finance is more useful for organisations that have specific uses for the capital in mind, because it usually raises a larger total sum. This sum can then be used for a variety of things – whether that is building a working capital buffer to strengthen cash flow in challenging market conditions, or something more growth-orientated, such as merger and acquisition activity, hiring more staff, or investing in product development.

Some specialist lenders will also offer specific multi-currency invoice finance facilities. These facilities are perfect for businesses that operate internationally, such as exporters and manufacturers, as it enables you to secure funding in the currency your invoices are raised in, rather than face hefty conversion charges.

#5 – Growth loans

Technically, all of the above can be considered growth loans, as the primary characteristic of a growth loan is that the capital raised is used to help a business grow.

The concept of a growth loan usually fits more with businesses that have a specific use for the funding in mind, particularly where that use is growth orientated. This could be for a number of reasons, including to execute mergers and acquisitions, to invest in research and development, or to expand into new premises, or hire more employees.

For this reason, term loans, venture debt, equity funding and invoice discounting fit more easily under the banner of “growth loans”, because they are more often used to fund specific strategies that accelerate a business’ growth.

#6 – Working capital

Working capital is similar – many different products, including invoice finance and term loans, can provide a business with working capital. The distinction between this and a growth loan, is that working capital is more often used to cover cash for day-to-day operations, rather than specific growth strategies.

However, for some businesses, increasing their available working capital means that they have more money to spend on things such a sales and marketing activity, which ultimately should contribute towards the growth of their business, so there is some crossover between the two definitions.

The importance of research

Financing a business can be an intimidating process, especially given the pressures of the current economic climate. Conducting some research on the above – and any other financial products that you think might be a good fit – is a good start. if you are still struggling, working with a finance advisor can be a great way of improving your knowledge of what is available. They will understand the nuances of each particular lender, as well as their lending criteria, risk appetite and associated fees and can usually offer an introduction once you have narrowed down your business funding options. Of course, there will be fees involved when you go down this route (usually made up of a fixed fee and then a percentage-based ‘success fee’) but like any consultant, if you take time to find a good one the benefits can be significant.

Online search is your friend too – most lenders have online calculators and application forms, so if you want to find out more, start reaching out. The ultimate takeaway is that the earlier you start looking in the fundraising process, the more business funding options you will have and therefore a better chance of finding something that is the right fit.

Vicki Taylor is principal at Growth Lending

Next steps

SmallBusiness.co.uk is working in partnership with trusted lenders to help you find the best finance deals.

If you’re looking for fast funding for your business, complete this quick application to access our panel of business lenders.

More on business funding options

Finance and support for your business – The Department for Business and Trade provides this useful list of finance schemes on offer from various UK local and regional government bodies.

Alternative business funding for small businesses – A comprehensive review of the sources of finance available outside of the ‘normal’ channels.

Small business startup funding – A guide to funding options available to get you through those early days.

Build Back Better #1 – equity vs debt, which is better? – Which is better when you want to grow your business, equity or debt? Ian Dawson examines the case for either.

A complete guide to business finance – Exploring the top ten options for SME finance and advice on where to find providers.

The post 6 business funding options for growth appeared first on Small Business UK.

If you have been reviewing your career and thinking about not just changing jobs but taking the plunge to work for yourself, or if you simply haven’t had the confidence to take the leap before now, Dave Chaplin, CEO and founder of ContractorCalculator, an online site that provides free advice and information for freelancers and contractors, gives you some food for thought that might just give you the push you need to finally go freelance.

Permanent employees considering making the leap into self-employment often think they don’t have the right skills, won’t find work, can’t afford it or are too young/too old. There’s always plenty of nagging ‘reasons’ to justify putting off the fear of the unknown.

However, there are nearly 2 million freelancers currently working for themselves in the UK and many of those would tell any wannabe freelancer, if you have a marketable skill that an organisation would benefit from using on a fixed-term or project basis, then you can become a freelancer.

And sometimes, if you think of the worst possible outcome and how you would overcome it, you discover that the only thing stopping you from taking the plunge is actually fear of the unknown and fear of failure. Do you really want to go another whole year without giving it a try?

1. Skills barriers – having transferable skills

Before you think about freelancing, ask yourself what skills you have that could be marketable. To go freelance, you need to have a recognised and potentially niche skill that is in demand in the labour market, and which can be transferred from your employer to your first and subsequent clients.

Many would-be freelancers might be put off freelancing or contracting because they have heard that only skills that can be applied on a project basis are marketable. This is a myth. There are plenty of roles out there that need a contractor to help manage capacity, or to cover for an employee who can’t work for an extended period, perhaps because of an internal secondment, maternity leave or long-term sick leave. And, if you are a journalist for example, you can work on a number of written briefs for a number of publications – you are a proven writer first and foremost.

2. Lack of experience

Some employees believe that they have acquired the transferable skills that would be suitable for freelancing or contracting, but lack the experience in applying them. And many would be right.

Clients are looking for someone who has been there and done it, and can hit the ground running. They want to know their contractor can run the entire project from start to finish without having to be told what to do or can take a brief and deliver the requisite outcome by a given deadline.

Experience can help and it may only take months and not years, and will make you much more marketable.

Once you have made the transition to work for yourself, then you will find that each role adds to your skills and experience. You can also keep your skills updated through formal training that you will choose and fund yourself. You may also gain ‘experience’ by applying these new skills on current projects, possibly for free as a gesture of goodwill to the client.

3. Selling yourself – ‘I won’t be able to find any contracts’

If you have got the right skills and experience, then finding work should be easy. There are literally thousands of job boards, both broad and specialised, to search, and recruitment agencies that are looking for contractors with exactly your skills.

You will need to create a ‘killer CV’ and hone your contract interview techniques, because they are very different from what you may have been used to as an employee. But there is plenty of help and advice available.

Many first-timers receive some knock-backs and rejections in the first weeks and months of their freelance career, but it is a learning curve. If you persevere and apply the help and advice that is available, then you will find work.

4. Money worries – ‘I can’t afford to start a business’

Starting up on your own in the UK is incredibly cheap. All you need is to:

• Incorporate a company
• Open a bank account
• Buy some business insurance
• Get your life cover arranged
• Get a mobile phone and some technology in place
• Find an accountant

…and you are in business. Potentially, that can all be done in a few hours.

Opening a bank account is free, and you’ll usually get a period with no bank charges. The start-up costs should be no barrier, and a few months of saving will cover these.

In fact, many accountants offer ‘first three months and company incorporation free’ type deals, and insurance can usually be paid monthly and not up front as a lump sum.

The real financial barrier you may encounter is not finding work for the first few months that it takes to find your first contract, and you have to fund your living costs. Many self-help gurus say that, ‘The best time for change is NOW’. This may be true, but it is essential to have a financial cushion because it enables you to have options.

So, before leaving your job, you should ensure that you have at least two and preferably six months of living costs as cash savings in the bank.

Related: Freelancers and gig workers are now entitled to payslips by law

5. Age is just a number – ‘I’m too old/young to go contracting’

Unfortunately, despite the obvious benefits of experience and the legislation in place to combat it, ‘ageism’ persists. If you are older when you take the plunge, play to those advantages and strengths that come with your experience, rather than those that focus purely on cutting-edge skill.

You may believe that you are too young to go freelance, but this is no barrier. If your skills meet the demand curve at the right point, then you will get hired. There are times when demand is high and supply is low when knowledge workers with only a few years of work-place experience get hired. And increasingly, more graduates are setting up on their own straight out of university and this graduate guide will help.

Experience also depends on attitude and circumstance. A fresh graduate working in the right organisation on a cutting-edge project may gain more experience in a year than another will gain in two years in a different organisation.

Clients are increasingly recognising the benefits of experience alongside a fresh perspective, so there is a place for both older and younger freelancers on project teams.

For example, in marketing younger people may be more in tune with the digital aspects of marketing and less on the strategy and business success of a marketing communications campaign. Older freelancers bring deep knowledge and business expertise.

6. Other barriers – credit and security checks

In some roles, you may find barriers that you cannot immediately or ever overcome, but these will not be a barrier to you becoming a freelancer or contractor. Typical examples include credit and security clearance.

If you have a poor personal credit history, perhaps because you had a business that failed leaving you with substantial debts, then it is unlikely you will secure a role with a financial sector client. You can work to improve your credit rating over time so that may get you to the point when your credit history will no longer be a barrier.

There are some assignments that require security clearance. This can be a protracted process taking many months, and you may ultimately fail to secure clearance for reasons that are completely beyond your control.

Neither of these should be obstacles to setting up on your own. There are plenty of contracts available across all skills and disciplines that do not require credit checking or security clearance.

Taking the plunge: The people who went freelance

What is it like to take on a freelance lifestyle after previously working for someone else? Here, we look at the experiences of the people who made it work.

Lauren Pope, Freelance Content Strategist

Website: La Pope

I work with clients to help them make great digital content through a combination of strategy, creative, optimisation and changes to their ways of working.

Before this, I was doing very similar work as head of content at a digital strategy agency. I’d been there for five years and – while I loved my the company and colleagues – I was ready for a change.

I felt that trying to serve my clients, manage my team, contribute to the development of the agency and have a life outside work was becoming a plate-spinning act, in part because I had to travel so much (46 business flights in 2017). I was putting a huge amount of energy and effort in, but wasn’t taking away as much satisfaction as I wanted. I realised that I was lacking a sense of meaning in my work – so I decided to go freelance to see if being my own boss could change that.

In terms of the actual work I do for clients, the skills were totally transferable – I’m doing a lot of the same work as I did before. I’ve had to resurrect some skills I haven’t used for a while (like Google Analytics and Excel) because I worked with specialists who handled those sorts of things before. I also realised that I’d absorbed some skills in things like business development, project management, and client service from my brilliant former colleagues. Knowing how to do a proper proper estimate and how to get to the bottom of what a client needs have been really helpful.

Setting up as a freelancer

I was quite spontaneous when it came to setting up as a freelancer. The idea had been floating around for a while, but I hadn’t thought about it deeply. To paraphrase the immortal words of Craig David: I made my mind up on Wednesday, talked to my husband on Thursday, and handed in my notice on Friday.

As soon as I’d done that, I started planning properly. I spent some time thinking about what my offering would be and who I wanted to work with. I made myself a one-page website as a way of helping me through that thought process. I also spent lots of time talking to friends and peers: using them as a sounding board, and learning from their experiences of freelancing. I wrote a blog post to announce that I was going freelance, which I published and shared on my networks a couple of days after I left my job. This prompted quite a few people to get in touch with leads, which helped me create a pipeline of opportunities. I was working pretty much from day one after I left, which I didn’t expect and was a huge relief from a financial point of view.

“I spent a lot of time researching day rates and agonising about what mine should be”

On the finance and admin side of things, I registered with HMRC early on and tried as best I could to educate myself about tax (I feel like I don’t know nearly enough about this still). I also had a good look at my finances and made myself a new budget for my personal spending to tide me over until I got paid for the first time. I spent a lot of time researching day rates and agonising about what mine should be. A week or two before I went freelance, I set myself up with FreeAgent for my bookkeeping and sorted out my insurance.

There are lots of pros to being freelance. I love being my own boss, the push it’s given me to grow, being able to work when and where I want. The biggest one is that I’m getting the sense of meaning I wanted from my work. My first big new business ‘win’ was for a charity, and it’s really motivating to know that if I do my job right, I can have a positive impact.

The cons are a constant background sense of dread and worry about money, being successful, whether I’m good enough! However, I felt all those things before I was freelance too – the difference is that now, they’re all pretty much solely under my control. That can be empowering or terrifying, depending on the day.

For other people making the switch to freelance, I’d probably suggest not making a decision quite as hastily as I did – I wish I’d spent more time saving up and preparing. I’d also say to try not to take your eye completely off the new business pipeline when you’re getting stuck into a project, you need to have new work coming down the line – this is something I’m trying to get the hang of at the moment too.

Natalie Sharp, Marketing Consultant

Website: Sharp Thinking Marketing

This year I set up Sharp Thinking Marketing, a marketing consultancy based in Tunbridge Wells for small businesses.

Prior to this, I’d been on a career break and had been a full time mum to two girls Lana and Laurel for five years. I had temporarily stepped away from the corporate world, but longed to get back into it. I adore my girls, but wanted to make use of my skills and of course, the money would come in handy.

However, I knew I wanted to do it differently, on my terms, ensuring it fitted around family life. Having moved here six years ago from London, my husband now commutes into London each day and is gone 15 hours each day. So, it was essential for me to still be able to do the nursery and school run, plus I still wanted my children to be able to go to their swimming lessons and dance classes. The natural step was to set up my own business. The plan was to combine my passion for marketing and helping businesses achieve new things, with freelance and flexible working.

“As a marketer, I knew it was important to showcase my skills and practice what I preach”

I found the transition extremely easy and have never looked back. My 15 years’ experience – a mix of agency and client side roles, with some contracting, allowed me to make the move seamlessly. It seemed like the natural transition. I had always wanted to set up my own consultancy.

As a marketer, I knew it was important to showcase my skills and practice what I preach. I started off writing a business plan which helped massively. It enabled me to define my offering and shape my product and services and develop my marketing strategy. I also researched the market to understand my competitors and pricing. Once I had completed this, my first task was to create my brand. I was fortunate enough to be married to a creative director so had access to some invaluable expertise. Although sometimes mixing business with pleasure can be tricky!

I then embarked upon creating a website. This was the exciting part – my dream was finally becoming the reality. Then, I developed all my corporate stationery. Once I felt ready and had a content plan in place, I set up my social media profiles. I now could engage with my target audience. Social media offers so many opportunities, but you need to be committed to it and be patient. Of course, there are all the admin/set up tasks to complete as well so you constantly need to be juggling hats.

The pros and cons of freelancing

There are many pros and cons of flying solo, but the benefits by far out way any disadvantages. You get to choose where and when you work (within reason!). Most importantly, it is extremely motivating and empowering to be your own boss. Only you are in the driving seat and deciding your next move. Plus, it allows me to work flexibly from home around the children.

On the downside, it can be tough generating business and wearing multiple hats – having to do all your own sales and marketing, finance, IT and admin. Of course you don’t get any company benefits such as holiday or sick pay. It is not for everyone. If you lone to be part of a team and thrive off working closely with other team members, then the freelance lifestyle can sometimes be isolating. However, there are things you can do to ensure you don’t feel alone and remind yourself, there are hundreds of people in the same position as you. Being part of a network can help. Join local networking groups in your area and online.

My advice would be, if you are thinking about going freelance, go for it, I’ve never looked back. But, be patient, and be prepared to put the work in. It takes time to establish yourself. Remind yourself continuously, it will be worth it in the long run.

Freelancers in the UK – Who are they?

• There are about 1.9 million of them: They contribute some £150 billion to the broad economy
• There are more men than women: The ratio was approximately 3:2 at the beginning of the 2020s, although the percentage of female freelancers has increased steadily since the 1990s and continues to edge towards parity
• 15 per cent of them are working mums: That’s just over a quarter of a million mothers balancing freelance work and children.
• Almost half of them are aged between 40 and 59: The average age of a UK freelancer is estimated to be 48 years. Over 60s represent c. 22 per cent of the total.
• The biggest group by broad occupation are those involved in the ‘Artistic, Literary, and Media’ sectors: These freelancers represented approximately 17 per cent of the total. The next biggest occupational group was ‘Managers and Directors’ (12 per cent), followed by ‘Teaching and Education professionals’ (7 per cent), and ‘Sports and Fitness’ (5 per cent).
• Self employed workers reached a peak at the end of 2020: After year-on-year consistent growth for two decades, the Covid pandemic saw numbers tumble to 2015 levels (c. 4.4 million as of May 2023)

Further Resources on Going Freelance

Freelancer loneliness and how to tackle it – We explore the extent of freelancer loneliness in the UK and what three solo entrepreneurs do to deal with the issue.

The top 5 UK cities to be a freelancer – Research into which cities are most conducive for those looking to pursue a more flexible work life.

A beginner’s guide to starting a freelance career – Dave Chaplin explains the basics on how to set your freelance rate, the importance of tailoring your CV, and where to find your next project.

Number of self-employed workers in the UK – Statista lays out the numbers from 1992 to 2023. Freelancers typically represent approximately 45 per cent of the self employed total in any given year.

Healing the relationship between businesses and freelancers – George Olver, co-founder of Movidiam, explores why poor practices regarding freelancers could be stifling the global creative industry.

Useful organisations for support and advice

IPSE – The Association of Independent Professionals and the Self-Employed
FCSA – The Freelancer & Contractor Services Association
Leapers – Supporting the mental health of freelancers and the self-employed

The post A small business guide to going freelance appeared first on Small Business UK.

Being a taxi driver can be a very flexible career. You can decide when and how long you want to work for – especially if you are a carer or have further education commitments or if you want to smooth out irregular income if you are, say, you are an actor or a tradesman.

It is ideal for those of us who have another career and need a “side hustle” to boost earnings. World-famous composer Philip Glass used to drive a New York yellow cab. Apparently, most of the Uber drivers in Los Angeles are would-be Hollywood screenwriters.

You’re your own boss, deciding how many hours and what time of the day or night you want to work. And, as of 2023, there are 289,400 licensed taxis and minicabs in England (GOV.UK, 2023), nearly a 30,000 increase since 2022, meaning there’s a great deal of demand.

>See also: 6 best small business ideas for 2023

How to become a minicab driver

A taxi driver is a black cab/hackney carriage driver, but a minicab drivers are private hire drivers. The essential difference between being a taxi driver and a minicab driver is that private hire vehicles (minicab) must be booked in advance through a licensed operator and cannot be hailed down in the street.

Another difference is that a taxi can sit on a rank or be hailed on the street, and accept bookings from any source, while a private hire vehicle cannot.

What are the essentials to become a minicab driver?

• You must be at least 21 years old
• Hold a UK licence for three years if you are planning to drive in London, but you only have to have had a licence for one year outside of London
• Have a legal right to live and work in the UK

What documents do I need to become a minicab driver?

Identification You will need to provide two documents as proof of identity, such as a national ID card or passport.

PHV (Private Hire Vehicle) licence A private hire vehicle (PHV) is defined as “any vehicle that can carry up to 8 passengers and is available for hire with a driver”. All licensed private hire drivers must work for a licensed private hire operator.

Small Business Pro is the ideal tool for you when you’re starting your business. It will help with the heavy lifting of managing customers, taking payments, insurance, finance and HR, plus you’ll get a host of personal wellbeing benefits.

You can find out more about Small Business Pro here.

How to get a PHV licence to drive a minicab

Up until 2016, the Driver and Vehicle Standards Agency (DVSA) offered a non-statutory scheme to many drivers and local authorities who required their taxi drivers to be assessed.

A number of driving schools and associations now provide this service to local authorities.

To obtain a PHV licence, you will need to meet specific requirements:

• Undergo a Group 2 medical examination to confirm you are medically fit. This includes an eyesight test and reporting any existing medical conditions, such as diabetes or if you’ve had a heart attack. Some authorities allow agencies to certify driver health, but others insist on a certificate from your actual GP
• Some local authorities may require certification, such as an NVQ Certificate in Road Passenger Vehicle Driving (Taxi and Private Hire), which take up to six months to pass and which is mostly theoretical
• Some require you to pass a topographical or local area knowledge skills assessment
• In London you will also need to take an additional SERU (Safety, Equality and Regulatory Understanding) test, which is the private-hire vehicle version of the famous London black cab “knowledge” test and is similarly administered by Transport for London. And, like The Knowledge, this SERU test can take up to three years to pass
• Clear an enhanced criminal record Disclosure and Barring Service (DBS) check. A full DBS check can take up to six weeks to come through. You also have to sign up to the DBS update service.

How long does it take to become a minicab driver?

Broadly speaking, even applying to become a minicab driver up to this point takes around six months and costs up to £1,500.

Your local authority then assesses your PHV licence application once it has been submitted. The local authority can then take anything between six to eighteen months to make a decision on your licence.

So we are now looking at a year-long application process.

And that is assuming you pass with flying colours – if there are any issues, such as a previous criminal conviction or medical problems, your licence application could be referred to a licensing committee hearing, which can take anything up to a further six months to even set a date. A bit like a magistrate’s court but on a civil law basis, you have to justify your PHV licence application in person.

Do I have to buy my own minicab?

Once your PHV licence has been granted, you have two options: you could either use your own car or you can work for a minicab operator which provides a vehicle.

Buying your own minicab can cost anything between £35,000 and £75,000 to get a good car on the road, especially if you want to drive an electric vehicle.

You may also want or need to fit out your vehicle, whether it’s bought outright or leased, with a Covid screen or CCTV for your own safety.

Dave Lawrie of the National Private Hire & Taxi Association (NPHTA) suggests that newbie drivers should cut their teeth working for an existing minicab firm.

Buying a car even at the lower end “is a hell of a commitment to do for a couple of weeks and then decide you don’t even like the job. So, test the water first”, says Lawrie.

How much can I earn as a minicab driver?

As of 2023, the average base salary for taxi drivers in the UK is £31,146 (Indeed, 2023).

But if you operate your business in London, you could earn up to £65,000 as a self-employed taxi driver (Glassdoor, 2023).

What’s good about being a minicab driver?

Many people are taxi drivers alongside other jobs, whether it’s being a tradesman such as an electrician or a plumber, a teacher or, in one case, a solicitor.

According to Dave Lawrie, being a minicab driver can be extremely rewarding – perhaps not financially but because of the service you provide, whether that’s getting the elderly to hospital appointments or helping the disabled with their shopping or ferrying children with special needs to school. Or even getting nurses to the hospitals they work in.

“I would emphasise the personal reward and the satisfaction it gives,” says Lawrie. “The appreciation you get for offering such as service outweighs the money side. It’s about putting something back into the community.”

How to become an Addison Lee driver

Addison Lee is seen as London’s premier minicab firm with over 5,000 cars in central London and carries out over 20,000 jobs every day and is responsible for over 10 million passengers each year in the capital.

Its positions range from courier and black taxi drivers to electric vehicle drivers and drivers on its executive fleet.

What documents do I need?

• You’ll need to have held a DVLA, Northern Ireland or EEA driving licence for at least three years
• A PCO licence, which is licenced by the department of Transport for London. This is required if you want to work as a taxi driver, minicab driver or chauffeur in London. To apply for the PCO licence you must be at least 21 years old and meet the required medical standards, which you can confirm by completing a standard check-up with your GP
• You must also pass a criminal record check
• Two other forms of identification

Does Addison Lee offer training?

Before you apply, there is no prior mandatory training required, but you need to be able to speak, read and understand English to communicate effectively with passengers.

Addison Lee provides a range of training in-house to help drivers feel confident and provide the best service possible to customers. This includes practical training, such as preparation and mock exams for mandatory SERU tests, and it also has strong relationships with several training colleges.

Addison Lee also provides additional training in partnership with UN Women UK, informing drivers about passenger safety.

How much can I expect to earn as an Addison Lee driver?

Drivers on Addison Lee’s corporate fleet have seen their earnings overtake pre-pandemic levels, the company says, and they now average £1,168 per week.

Addison Lee guarantees new drivers receive a minimum of £5,000 earnings in their first month driving, followed by a £1,200 cash bonus after 12 weeks.

The firm also offers a pension, topping up 5 per cent of qualifying pensionable earnings through a 3 per cent contribution, as well as providing sick and holiday pay. The company also offers a rewards package, including discount codes and cinema tickets.

How to become a black cab taxi driver

The black taxi is an iconic image of London but to become a cabbie is a demanding process, which can take up to four years and involves passing one of the most difficult exams possible – known as The Knowledge – and checks your encyclopaedic understanding of every street in the capital.

There are around 24,000 taxi drivers in London, with about 21,000 green badge All London drivers and about 3,000 yellow badge Suburban drivers.

How to become a taxi driver

Named after a midsized horse which French women used to ride side-saddle – and more generally became synonymous as a horse and carriage for hire – the process of becoming what’s known as a hackney carriage driver starts when you apply to your local council for a taxi driving licence.

At this stage, you must:

• Be at least 21 years old and have held your full GB or Northern Ireland driving licence for at least one year
• You have the right to live and work in the UK
• Prove you are a “fit and proper person”, which involves having an enhanced criminal records check from the Disclosure and Barring Service (DBS)
• Taking a medical examination to meet the Driver and Vehicle Licensing Agency (DVLA) Group 2 medical standards

If you are in London and want to drive an iconic London black cab, you will need to apply to Transport for London (TfL) to obtain a Public Carriage Office (PCO) licence to drive a taxi. This PCO licence enables you to work as either a private hire vehicle minicab driver or a black taxi driver.

What do I need to obtain a PCO licence?

• You must have a completed Group 2 medical form issued by either your own doctor or an approved body to assure the licensing authority that you are medically fit to drive a licensed vehicle
• You must have had a driving licence for at least three years

Taxi Assessment of Driving Ability

All new drivers are required to complete the Taxi Assessment of Driving Ability. This is an advanced driving assessment, during which a professional driving examiner will mark your driving ability and style, as well as your ability to perform various everyday taxi manoeuvres, such as identifying safe stopping points from where to pick up or set down passengers and how to avoid puddles.

You will also be asked a number of driving theory questions, including some on the relevant licensing legislation and local conditions.

Passing ‘the Knowledge’

All London drivers, also known as “Green Badge” drivers, need a detailed All London Knowledge of London within a six-mile radius of Charing Cross. To begin with there are 320 routes or “runs” to learn, along with all the places of interest and important landmarks on and around these runs. Points include landmarks such as clubs, hospitals, hotels, theatres, embassies, stations and historic buildings. You’ll need a copy of the Guide to learning the Knowledge of London, also known as the Blue Book.

Applicants for the All London Knowledge must learn the suburban routes from central London to the suburbs, and to and from Heathrow and London City airports.

It takes between two to four years to learn and pass “the Knowledge”, which will mean considerable gumption on your part.

Around 70 per cent of students training to become licensed London taxi drivers drop out of the All London Knowledge testing process.

Green badge vs yellow badge

Actually, there are two types of badges for drivers in London.

If you don’t want to become a Greater London taxi driver, you can also become a taxi driver in one of the nine suburban sectors. The process of becoming a Suburban taxi driver is similar to the All London Knowledge, except suburban drivers can only be hailed in their chosen sector. Successful Suburban Knowledge candidates are given a yellow badge.

How to become an Uber driver

The process for becoming an Uber driver is the same as obtaining a general vehicle licence.

Uber offers a guide on get a private hire licence in the UK, as well as specifically in London.

Sign up to become an Uber driver online

• Sign up online. You’ll need to download the Uber app onto your smartphone or other device
• Upload your documents:
• A valid UK driver’s licence
• Be at least 21 years old
• Private hire insurance allowing you to transport passengers for hire and reward
• Bank statement for the bank account that will be used to receive payments from Uber, which needs to be under your own name or a business which you are an owner of
• Driver profile photo
• Complete Edume virtual onboarding course

How long do I need to have been driving for?

The number of years’ experience you need to have varies depending on the city you want to drive an Uber car in – for example, in London, a minimum of three years’ driving experience is required.

Do I have to own my own Uber vehicle?

No, you do not. Uber offers various options for obtaining qualifying vehicles, including flexi-lease, leasing and rental through Uber’s own Vehicle Solutions programme.

Uber also has a sister company called PartnerPoint, which offers deals on renting and leasing cars – however, going down this route can be pricey and should only be used if you are testing the water.

If you plan to use your own car, your vehicle must be either hybrid or ZEC (zero emissions capable) and have a 2008 registration or later.

What other documents will I need?

Personal documents

• National Insurance (NI) number
• Original plastic UK driving licence
• Electronic counterpart code
• PCO Paper Licence (you’ll need to bring this with you to your scheduled visit)

Vehicle documents

• PHV licence
• Logbook/new keepers slip
• MOT (issued within the previous six months)
• Private hire insurance certificate

Becoming an Uber driver in London

If you’re interested in becoming an Uber driver in London, there are some specific requirements for operating as an Uber driver in the capital:

In addition to other standard Uber requirements, as we have seen, you will also need to have a Transport for London (TfL) PHV licence or a Public Carriage Office (PCO) licence.

Uber offers in-person help for obtaining your PCO licence through its Uber Ignition programme, which helps you negotiate the paperwork.

How much can an Uber driver make?

Full-time Uber drivers in the UK can expect to be paid between £22,000 to £65,000 a year, according to Glassdoor (2023).

Related:

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How to start a dropshipping business – What is dropshipping, what are the advantages and how do you start a dropshipping business?

How to start your own coffee shop – Fancy opening your own coffee shop? We explain what you need to know about cash flow, hiring staff and of course, finding the right coffee

The post How to start a taxi business appeared first on Small Business UK.

You’re not alone if you’re thinking about becoming a driving instructor.

Due to the pandemic and subsequent lockdowns, there are now more learner drivers looking for instructors than ever. According to research conducted earlier this year by the Driver and Vehicle Standards Agency (DVSA), there are so many individuals wishing to learn to drive that the waiting list for tests has remained over half a million since June 2021 and was 551,271 in May 2023.

What’s more, the 2023 Annual UK Driving Instructor Review revealed that 40% of driving
instructors are now achieving gross weekly earnings of £1000 or more.

The pandemic has encouraged people to rely on themselves for an income – and becoming a driving instructor could be a good way to do that. We’ll go through the pros and cons of being a driving instructor, how the process works and whether you should go with a franchise or become an independent driving instructor.

How long does it take to become a driving instructor?

Normally, it can take between six and 12 months to become a driving instructor. However, waiting times for tests is an issue at present.

“The training can actually be done. If you really wanted to downsize it, technically you can do the training in a week or two,” said Michael Sargent, founder of Nayland Driving School. He suggested studying for the advanced theory in your own time. The training for the advanced driving test usually takes about eight to ten hours, polishing up on bad habits.

“You could deliver that in a couple of days, but you might not get a test for two months,” he said. “We’re getting people to book the test, then about a month before the exam, we’re starting the training, seeing them a couple of hours a week.” From there, you can also do a couple of hours in your own car, giving you a week to practice. Doing the same for another couple of hours, a week to practice and then another couple of hours. “Then when we get to the final exam, that’s 40 hours’ training,” he said.

After passing the second part of the test, you have the option to apply for a trainee licence which is valid for six months. You’ll either need to:

• Be supervised for 20 per cent of all lessons you give while you have your trainee licence
• Do at least 20 hours of extra training while you have your trainee licence

How much can I earn as a driving instructor?

This will vary depending on whether you’re independent or part of a franchise, then there’s variety within that. However, as demand has grown, so have the prices of lessons, and the 2023 Annual UK Driving Instructor Review survey indicates that instructors are now earning more than £30 per hour on average for the first time on record. More on that in a minute.

Am I eligible to become a driving instructor?

To become a driving instructor, you need to be at least 21 years old and have had a full driving licence for over three years.

The government says that your application may be rejected if you’ve had a driving ban, have five points or more on your licence or have been convicted of any non-motoring offences. This will be decided on case-by-case basis by the ADI Registrar. Your application is likely to be rejected if you’ve been banned from working with children or have sexual assault, violence or drug-related crime offences.

You must get a Disclosure and Barring Service (DBS) check to begin your driving instructor application, even if you already have one. A basic DBS check costs £10.

Normally you’d need to have a manual car because tests are carried out in manual vehicles. If you have a disability and want to become an automatic instructor, then you can have an automatic vehicle.

“If someone is curious about becoming a driving instructor, I quite often spend an hour on the phone, or an hour having a coffee with them,” said Sargent. “It’s genuinely quite a big decision.”

He said that being friendly, approachable and reliable are key qualities for a driving instructor. A clean car is also essential. “These are sort of things that students notice. The teaching stuff, they don’t notice so much. Even if you’re struggling with the teaching, in the early stages, they naturally always assume it’s them. If they can’t grasp something, they won’t for one minute think it’s your teaching, because they can’t drive.”

What are the pros and cons of being a driving instructor?

As we’ve established, there’s plenty of work out there, meaning more money for instructors. Driving instructors have increased their prices since the pandemic and are now earning £33.41 an hour on average, compared to the average of £27.60 an hour in 2020 (The 2023 Annual UK Driving Instructor Review, 2023).

The same survey revealed that, for the most part, driving instructors also have a high level of satisfaction when it comes to work, with 92% claiming to be at least ‘satisfied’ and 42% reporting ‘very high feelings of satisfaction.

>See also: Tips on how to achieve work-life balance

However, something to consider when becoming a driving instructor is that you will be, in most cases, self-employed. And, while there are many perks to self-employment, there are some drawbacks, including a lack of stability. “I think the main reason [instructors have left], from my point of view, is a lot of them weren’t entitled to anything during lockdowns. They’re self-employed, but they hadn’t been self-employed three years and couldn’t show three work three years’ worth of books,” said Sargent. “From the people I speak to, more than anything, they’ve left because they didn’t have a choice.”

What does the test consist of?

It’s made up of three qualifying tests.

Test one – ADI test part one (advanced theory)

Cost: £81

This is similar to the standard learner’s theory test in that there’s a multiple choice and hazard perception element.

Take your photocard licence to the test. If you don’t have one – you should bring your passport along with your paper licence. If you don’t have a passport, you will need a photocard licence.

Depending on where you’re doing your test, you may have to wear a face covering. In England it’s your choice to wear a face covering but in Scotland and Wales it’s compulsory unless you’re exempt.

Test two – ADI test part two (advanced driving)

Cost: £111

The second test is a driving ability test – otherwise known as a practical test. If you pass the second ADI test, you have the option to apply for a six-month trainee licence so that you can experience teaching students. It costs £140 to apply for a trainee instructor licence.

Test three – driving instructor test

Cost: £111

Part three of the test measures your ability to teach students. Your instructor will call you a few days before and ask you where you want to start the test – it can either be the driving test centre or within five minutes of the test centre. Note that it works differently in Northern Ireland.

Driving instructor training is also available if you want help before the test.

For this test, you’ll need your licence, a suitable car and a pupil. You should also bring a log book with you that details the training that you’ve been doing to qualify as an approved driving instructor.    

The driving examiner will watch you give a 45-minute lesson where your pupil must be driving for at least 40 minutes of the lesson. You must discuss the goals of the lesson and risk at the beginning. At the end of the lesson, give your pupil no longer than three minutes to reflect on the performance in their lesson.

Your pupil can be a partly trained learner, a fully trained learner or a full licence holder. However, they cannot be someone who has just started learning to drive or an approved ADI or someone looking to take their ADI test.

You can retake if you fail the third test once or twice, but if you fail three times, you need to take the ADI 1 and 2 again. You must wait until two years after you originally passed your ADI 1 test before sitting it again. You can also appeal if you fail your ADI 3 and you feel your examiner didn’t adhere to the law during the test.

If you pass you must apply for your ADI licence within 12 months or sit the three qualifying tests again. It costs £300 to register for your ADI certificate. When you have this certificate, you can start charging for lessons.

Should I join a franchise or be an independent driving instructor?

This is arguably the biggest decision you make once you become a driving instructor. You can either set up as a sole trader with your own business or be an instructor with a driving school. You’ll still be classed as self-employed whatever you decide.

>See also: How to become a sole trader

If you’re with a brand, you get support with finding pupils, marketing and other essentials. The flipside is that you’re not in control of everything. Introductory lessons are often charged at a reduced rate, for example, which is out of your control. The cost of lessons will be determined by the cost of living where you’re teaching.

If you’re independent, you’ll have more control of your schedule and your clients. It is more time-consuming taking care of admin and repairs, though.

Sargent said that most people will recommend joining a local franchise. If you take the trainee licence option mentioned above, you don’t really have much choice because you need a sponsor for supervision. “There are some ways around it,” he said. “If you know a good driving instructor down the road, you might be able to get them to sponsor you. Generally, you’ll join a school and the school is going to become your sponsor.”

That’s not to say that once you make the decision on independent vs franchise, you can’t switch. It’s especially true of joining a franchise, which some see as a first step to becoming independent.

“I think quite commonly, we see people stay with a franchise for two, three years,” said Sargent. “Once they start getting a good reputation, getting the phone call saying, Oh, you know, we you taught my brother, you taught my sister, my friend, whatever, that’s when they start thinking, ‘Yeah, but you know what? I think I can make a go of this now.’”

“If you’re going to go independent, now’s the time. There’s so much work around.”

What insurance do driving instructors need?

To become a driving instructor, you’ll need to consider the insurance you need. 

Numerous policies could benefit your business, but not all of them are legally required. So, let’s split your options into two categories.

Legally required policies

As a driving instructor, you’re legally required to take out ‘Driving instructor insurance’. This policy is much like a standard motor insurance policy, except it has additional coverage due to the risks associated with learner drivers taking to the roads. 

Additionally, if you employ anyone, you’re required by law to take out ‘Employers liability insurance’. This policy protects you financially if any of your employees make a legal claim against you.

Highly recommended policies

Not all policies are required by law, but that’s not to say you should go without them. Insuring yourself against potential damage to your vehicle and breakdowns could not only save you hassle but a lot of money too. 

Here are some policies you might want to consider:

Scratch and dent for taxi drivers and driving instructors – nothing makes a car look more unprofessional than visible scratches and dents. With this policy, you’ll be covered financially for repairs.

Motor GAP insurance for driving instructors – as a driving instructor, your vehicle is more liable to significant damage. Motor GAP insurance covers the financial discrepancy if your car is written off and your motor insurance policy won’t pay out the full amount you paid for the vehicle.

Motor breakdown insurance for driving instructors – there’s never a convenient time to break down, but when your car is your livelihood, getting it back up and running ASAP is essential. And motor breakdown insurance will help you do just that. 

Atia Farooqi is a driving instructor with RED Driving School and is based in Manchester.

How long have you been with your franchise?

Since 2018. I’d been working in a call centre at another company.

I did my training. I passed my part one and part two. Then I signed up with RED to do part three, because you need to have the 40 hours training. I did my training while working full-time. I probably knew it was going to be hard because I’ve got a family as well. But I knew in the end, it’d be better for them. Once I completed everything, got my training licence and did my business seminar (you have to do a two-day business seminar with them), then I left my full-time job and started in the January as a full franchisee.

What made you choose a franchise over going solo?

I chose the full franchise because I’m somebody that’s never been self-employed. I’ve always been employed, so I don’t have to worry about anything. I just go to work, do my work and I get paid at the end of the month. It was more probably for the support and to help me kind of wean myself into it. There was going to be somebody there to help me.

What kind of support do driving schools provide?

They provide you help with doing your taxes and stuff. They also provide business support as in advertisements, your social media, they’ll help you get started with that. Social media, in this day and age, is how everything kind of works. Whenever I had any question about the actual job, because I’d never done it before, they were there. I used to be a teaching assistant. The teaching aspects were okay, but it was a new subject. So any help I needed with things like that, I’d ring up my trainer and he’s like, ‘Yeah, no, try this way’ or ‘Look at this’. When you first start up, throughout your training and they give you a lot of stuff to help you – with the guidance of how you should be doing things, what kind of things you need to know, how you can teach it and adapt it to different people. You can’t teach the same thing to everybody. You have to be able to adapt to your customers and they’re helping you with things like what to look out for, how you can approach them in different ways and so on.

Do you utilise your own personal social media or do they provide some channels for you that you can use?

They didn’t do it for me. They will just tell you that one of the best ways to get out there is social media. They encourage you to create your own Facebook page, what kind of things you can put on it, what kinds of things you should stay away from, things like that. The more likes you get and the more people that are on it, the more recommendations you get. Honestly, Facebook has been great. I asked one student that just tagged me in everything for help, so it’s a good tool, especially for people that don’t use it or haven’t used it before.

I can imagine that a franchise will give you continued support with things like legal changes, changes to how to conduct driving lessons, especially during Covid – they would have kept you up to date with that kind of thing, giving guidance and so on.

If I’m really honest, and I’m not just saying it, they’ve been absolutely brilliant throughout Covid. They have kept us up to date with everything that’s going on. We got weekly videos when we were sitting at home in lockdown. When you get that insight, you think, ‘Right, a bit of hope that it’s going to get better. We are going to get back to work.’

They do keep me up to date with everything that’s going on – DVSA announcements, any changes. I don’t know about other companies that have not worked for the company’s driving schools, but I do know a few people that are independent. They didn’t get support like that because they’re independent.

Why do you like being a franchise driving instructor rather than an independent?

Being independent, I suppose you do a lot more yourself and I wouldn’t have the support, I would need to be my own support. I would have to go and find out all these things that RED would quite happily share with me, like car maintenance.

Or I’ll book it into Renault or Quickfit, or wherever. I just send a quick email rather than phone and they’ll respond, let me know what I need to do. So that is the big thing, because we need the car every day to work.

Students know that I’m a driving instructor. People took lessons with me, not because of me, it was because of RED. It was because of the brand. That’s it. I’ve been doing it a while, so now I’ve got word of mouth. I’ve got one girl that passed a couple of years ago and I taught her older brother. I do lessons with her younger brother and her sister-in-law now.

My sister is an independent driving instructor and she has been doing it for about 20 years. I don’t have any intentions of becoming independent at the moment, but she goes on at me all the time, ‘I’m an independent, come join me!’ I like the way RED treat me and the way they look after me. I have a good relationship with them. They gave me the support that I want when I need help. I can go to them.

How has the role of your job changed since the pandemic hit? There are backlogs and long test waiting times. How have you adapted to that and how has being with a franchise helped?

I think, speaking for all driving instructors in our schools, there is a huge demand at the moment. There’s the normal backlog, the normal people that just come in and want to learn how to drive, but even more people in lockdown that wanted to do it now want to do it. When I first went back after the first lockdown, I was really busy. Don’t forget that the pandemic changed things for everybody. When I was really busy, I thought to myself, ‘Okay, I’ve had all this time off, and I really enjoyed it.’ I wanted to go to work, but I did enjoy being at home. I thought, ‘Okay, I’m going to take my time with everything. I’m not going to work every hour, doing whatever.’

If I’m honest, work has been busy. But the whole point of doing this, and I can’t forget it, is I have got more time at home with my kids. My youngest is growing up quick and I didn’t want to miss out on that time. It lets me take her to football training. I’ve also started doing my functional skills for math because the whole point was, I need flexibility, because I’ve always wanted to be a midwife. I’ve done my level one over this last year, In the pandemic, and I’ll be going to do my level two in September, but this can give me the flexibility. Even though we’re really busy, I can still take time out to do what I need to do.

You don’t feel pressure to take on extra pupils?

No, not at all. The good thing is, if I feel like, ‘Well, I’ve got a bit of spare time’, I can just easily let them know and pop another student in my diary. I’ve only opened my diary once since we went back in April, because I had students waiting from before Christmas time.

Do you feel there are advantages to being a female driving instructor?

Yes. Because I’ve had students make comments before. As we’re in 2021, I didn’t think people still felt like that. Some females, not all of them, they say to me that women are a lot softer. They are a lot more understanding. I’m not saying male instructors aren’t, but some of the students prefer women.

Chester Dent was part of a franchise before deciding to become an independent driving instructor in Guildford.

You used to be with a franchise and you’ve since gone independent. When did you go independent?

I started in the middle of June this year. I needed to give the franchise three months’ notice before I left. I started with the franchise in March 2009.  

What was it that made you go independent?

I wanted more control of my time. The franchise website was giving offers. I had to do the first session half price, for example. I realised that around here, it’s not a price-sensitive market. If anything, it’s supposed to be a bit more expensive – it’s reassuringly expensive to the parents. I realised that I was actually at the bottom of the market with that franchise. They were based in Essex and I’m based in Surrey. The rates were substantially lower than the going rate round here. I realised that, when the driving instructor who lives around the corner asked if I could fill in for him and then he said that he could only do that on the basis that I matched his prices. That’s 30 per cent more than I was charging at the time. I had to negotiate that I had a separate rate that was different for my area. They had to upgrade their website at the franchise and it’s all a bit complicated, but in the end, the main reason I went independent was my time.

What other limitations did you find with a franchise?

They manage your diary, take a phone call, when you’re driving your car. In theory, they are helping you to manage your time. In practice, all they really do is give you the first session with somebody, so you’ve committed to whoever that person is without speaking to them, whenever that person wants. I found myself restricting my diary to blocking out practically all the time, so that I could predict when I was going to get a new person.

The other reason is that I wanted to go from two-hour lessons to 90-minute lessons. I realised that after about an hour and a half, I was losing the will to live. An hour and a half is more than enough time. Also, when I was raising my rate, it didn’t seem so bad to give six lessons, instead of a package of five. Although they’re shorter, I think people get more benefit from having an extra lesson.

I think the franchise fee was £80 a week and I negotiated that down a bit.

Have you been a business owner before?

Yeah. I don’t consider myself to know anything about business, but I have had other small companies in the past.

I’ve been a sole trader and I’ve had another limited company and I have another business. I started working as a driving instructor because we had a baby in 2016. I had to have a change my lifestyle, spend more time at home while I was running another business without the other work I did before that.

Do you have any marketing tips for anybody reading who might want to be an independent?

I made my own website and got on Google and started getting people in and got repeat business from other family members and that kind of thing. Now I’ve got more people than I can cope with. I did a bit of website design in a different incarnation years ago, so I didn’t find that part difficult. I used Google Ads for two or three months. I don’t pay them anymore.

I took quite a long time to decide quite how I was going to pitch myself and I’m not sure if I quite got this right. I think it’s how you make people feel, rather than something technical. I tried to make my website about selling a good feeling. Calm, reassuring, easy going.

What was it like when you first transitioned from franchise to independent?

It was fairly seamless. By the time I left, I had everything in place. I was putting myself out there.

The most time-consuming thing about it is arranging when the lessons are going to be, where you’re going to be so that you’re not having to travel too far between people, creating a sort of bearable schedule. I work nine until six and then I probably do another hour and a half to two hours of just arranging things and pencilling in lessons, getting everything paid in advance. Then keeping everything up to date. Knowing who I’m going to see and what my day is going to be like, how long I have to drive between people, I’d rather be in control of all that.

The only thing that made all this really come together is on an app that I use. It helps organise my day. It connects to my website too, so I can pay with Stripe, PayPal or credit cards directly on the website. Most of my time is either spent on driving, or spending hours on the app, working on the diary and the finances. By the time I’d left the franchise, I was using the app intensively and basically running my own business anyway.

For somebody who is training to become a driving instructor, would you recommend they go with a franchise before going independent?

Oh yeah, absolutely. The franchise I joined was very supportive.  I’d say that without doing the job, you can’t really learn it. I think just putting the hours in is really important. It took me quite a long time to qualify.

First of all, legally, you have to be trained and belong to a driving school before you qualify. In theory, you could pass your part three and go independent. But I would recommend it – you need that supportive environment and you need time to find your feet and realise what it is you need.

I don’t have the experience of a big franchise, but my experience with smaller franchise. I think they had only nine instructors when I joined. They’re reasonable, you can talk to the boss. I felt very good and I felt a loyalty to them, which I might not have done with a larger franchise.

Read more

What is a franchise? Advice for small businesses

The post How to become a driving instructor appeared first on Small Business UK.

Self-employment is still a valid route, despite a drop in the number of people going into their own business post-pandemic. Indeed, three quarters of all British businesses have no other employees. At the beginning of 2021, 4.2m of the UK’s 5.6m small businesses had no employees apart from themselves.

And the number of self-employed businesses has grown by 77 per cent since 2000.

Jobs for life tend to be a rarity these days, and this uncertainty has led to many people moving towards having more control over their own lives and finances.

Can you have a company car if you’re self-employed? – Mike Parkes of GoSimpleTax explains the must-know info about owning a company car when you’re self-employed

Different types of self-employment

It’s important to define which is best for you before you start a business. It can affect things such as the tax rates you need to pay, how you are able to take money from the company, and your responsibilities and liabilities in the event of a loss, as well as which paperwork needs to be completed.

Sole trader

A sole trader is more straightforward self-employment. It can mean some extra risk to the business because you are personally responsible for all your business debts if it fails.

It can also make you more personally accountable in the event of a lawsuit. As a limited company, it is the company which is being sued but, as a sole trader, you yourself could be in the dock.

However, if it’s a low-cost business that is unlikely to incur any debts or cause any personal or financial damage to another party, then a sole trader might be the right choice for you.

But if you’re likely to incur any significant debts or legal risks, the financial protection offered by becoming incorporated and forming a limited company would be advisable.

Sole traders get to keep all their business profits after tax has been paid on them.

Best mobile phone payment for self-employed – Payment devices you carry around with you have revolutionised how customers pay. We look at six of the best mobile card readers

Setting up as a sole trader

Setting up as a sole trader is relatively straightforward. Go ahead and register for self-assessment with HMRC. To become a sole trader, you must register using the government portal within three months of founding your business.

Technically speaking, you don’t need to register as a sole trader unless the income you earn from self-employment is more than the tax-free allowance, which currently stands at £1,000.

For example, if you’re in full-time employment, but do paid-for gardening on the side, you won’t need to tell HMRC, providing your self-employed earnings are less than £1,000.

If you think you’ll earn more than this, the deadline to register for self-assessment is October 5 in your second tax year of trading.

Tax-free allowance

Your personal allowance for tax-free income in 2023 is £12,570. Anything above this will be subject to corporation tax (20 per cent on anything between £12,570 and £45,000).

National Insurance contributions

If you’re a sole trader in self-employment, you must also pay National Insurance (NI) contributions if you have profits above £12,570 or more a year. If this applies, you’ll pay Class 2 NI contributions at a flat rate of £3.45 per week. If your profits are over £12,570 for the year, you’ll also pay Class 4 NI contributions at a rate of 9 per cent of the profits you make up to between £45,000 and £50,270 (and a further 2 per cent on any more profits over that).

Partnership

A partnership is when a business is owned by more than one person, where they are all responsible for the growth of the company.

These partners are also liable for any losses made by the company, as well as bills for anything the company owes money on.

Profits are shared out between all partners and individual tax and NI is paid by each partner. Partners can be people or companies.

One person is nominated for the responsibility of accountancy for the partnership.

Setting up as a partnership

The person who was nominated for the responsibility of accountancy will have to register the partnership with the HMRC.

All partners will need to register for self-assessment, so that they can pay NI and tax on their portions of the profits.

You will need to register your partnership within the same time frame as a sole trader.

Limited company

A limited company is a form of business that separates the people that own and run a business from the business itself, making it its own entity.

With a limited company, shares are held by the individuals and profits are owned by the company itself after the company pays corporation tax.

These profits are then shared out with the shareholders. Shares in the company can be bought and sold.

The term limited comes from the idea that the company is “limited” by its shares. At formation, a company might issue 100 shares at £1 each and these shares are paid for in full by four shareholders at 25 shares each.

However, if these 25 shares each aren’t paid for in full and the company goes bust, the company directors are only responsible for paying the value of its remaining unpaid shares.

Usually, directors own shares in a limited company but this isn’t necessary. Directors are responsible for running a limited company and this can be anyone.

Providing the law has not been broken, company directors aren’t made responsible for the business debts if the company makes a loss.

Setting up a limited company

The limited company must register itself at Companies House and give HMRC a date for when the business officially starts running. If the company expects to take more than £85,000 per year it must also register for VAT.

Every year the company must also provide statutory accounts to HMRC that comply with either UK Generally Accepted Accounting Practice or International Financial Reporting Standards.

An annual return must be sent to Companies House and HMRC must receive a Company Tax Return.

Directors must fill in a self-assessment tax return and, if a salary is paid, pay NI and tax through PAYE.

Limited liability partnerships

Partners in limited liability partnerships aren’t personally liable for debts incurred. As with limited companies, their liability is limited to the money invested into the business at the business in the beginning.

Limited partnerships

Liability for debts is split into two categories. The debts of “general” partners and the debts of “limited” partners.

General partners are liable for all debts incurred whereas limited partners only need to pay the amount initially invested in the business, just like with limited companies.

Setting it up

Visit this Companies House link to find out more about setting up this kind of partnership company.

Which kind of self-employment is right for you?

Choosing the right legal status for your company is important to get right. There are pros and cons to all of them.

Some structures may seem more dynamic and flexible than others. Some will offer more protection than others. Some will come with more bureaucracy and other headaches.

If you’re unsure, in some cases it may be best to start off as a sole trader and, when things start getting serious, you can incorporate your business.

The reality of self-employment

Last year more than 40 per cent of those in self-employment earned less than £12,000 a year, according to the London School of Economics.

The truth of self-employment is that, unlike being an employee, you never really switch off. Running your own business means that you are captain of your own ship and not answerable to anybody. That is a huge psychological freedom compared to being stuck in a job you hate.

More on self-employment

Becoming self-employed – Becoming self-employed could mean less income, more responsibility and working longer hours. But freedom and independence cannot be underestimated, says Margaret Wood

The post A small business guide to self employment appeared first on Small Business UK.

Whether or not you need to pay Value Added Tax (VAT) as a sole trader depends entirely on how much money your business is turning over. Basically, if at the end of any month your annual turnover exceeded £85,000 in the previous 12 months, you need to register for VAT.

You can also voluntarily register for VAT even if your turnover is under the threshold. Some sole traders choose to do this so that they can claim back the VAT on goods and services purchased for their business or to avoid financial penalties from accidentally going over the threshold.

Below, we explain how to register for VAT as a sole trader, how much you need to pay, VAT rates, charging VAT to customers, and MTD for VAT.

Registering for VAT as a sole trader 

You can register for VAT online with HMRC. Once approved, you should receive a unique VAT number relevant only to your business within 30 days. 

It will be provided on a VAT registration certificate, which will also have details of the dates you need to submit your first VAT Return by, and your effective date of registration (the date when you started to pay VAT).

Your VAT registration will be under whatever name you choose to trade as, whether that’s your own name or the name of your business. 

VAT rates as a sole trader

There are three different levels of VAT:

• Standard rate – currently 20 per cent, this applies to the majority of goods and services
• Reduced rate – currently 5 per cent, this applies to a very select set of goods and services, such as children’s car seats and home energy
• Zero rate – 0 per cent, which applies to most food and children’s clothes

You can find the full list of VAT ratings and exemptions here: VAT rates on different goods and services. 

(NB – There are also VAT exempt items, for which you cannot claim back input VAT on expenses used to produce the zero rated good. You can find a comprehensive explanation of this here: Help With HMRC)

Charging VAT on goods and services sold to customers

You will be required to charge the VAT element on your sales invoices. For example, if your invoice value is £1,000, you’ll add £200 (20 per cent) to the total price of the product or service and the customer will pay you £1,200.

Every quarter you’ll complete a VAT return showing how much you have collected in VAT from customers (Output VAT) and how much VAT you have paid to your suppliers (Input VAT).

If the Output VAT exceeds the Input VAT, you’ll pay the difference to HMRC. However, if the Input VAT exceeds the Output VAT, you’re able to claim back the difference amount from HMRC.

MTD for VAT

All VAT-registered businesses, regardless of turnover, should now be signed up for Making Tax Digital for VAT. Every business will be signed up automatically unless they apply for a VAT exemption. Making Tax Digital is part of the government’s initiative to make the UK tax system fully digital. 

In order to comply, you’ll have to use HMRC-approved software to maintain digital VAT records and submit your quarterly VAT returns.  

Three VAT Public Notices which offer relevant advice are:

• Notice 700 – VAT General Guide
• Notice 700/1 – Should I be registered for VAT?
• Notice 700/22 – Making Tax Digital for VAT
• These can be located here

The VAT advice line will help with queries on 0300 200 3700.

The relevant form is an Application for Registration – VAT 1 and you can download it all here.

If you have any doubts you should talk to your accountant who will explain the requirements in greater detail, and can help with specific queries or even complete the VAT return on your behalf.

How to easily track your profits?

Accounting software can help you comply with Making Tax Digital for VAT – and generally make it easier to manage your business cashflow and profits.

There’s a range of providers to choose from. We’ve rounded up three of the best below.

Further reading

The best accounting software for small businesses – It’s never been easier or more affordable to manage your tax and accounting using small business accounting software – find the best accounting package for your needs
How to manage your accounts as a small business – Everything you need to know about preparing your financials in the early stages of business
Tax advantages of a limited company versus sole trader – Haydn Rogan explains the tax advantages and disadvantages of status as a limited company and as a sole trader
9 accounting software platforms for Making Tax Digital – Here, Mariah Tompkins scrutinises accounting software options that small businesses can use for their digital tax returns 

The post Sole traders and VAT appeared first on Small Business UK.

So, you have made the decision to start your own business, great! Let’s work on turning your idea into a reality. There is a lot to starting your business properly, this is why we have put together this 18-item checklist you’ll need to do before you start your company all the way through to your regular routine once you have formed your limited company.

Small Business Pro is the ideal tool for you when you’re starting your business. It will help with the heavy lifting of managing customers, taking payments, insurance, finance and HR, plus you’ll get a host of personal wellbeing benefits.

You can find out more about Small Business Pro here.

Contents

The steps before you start:

1. Research
2. Think of a name
3. Secure website domain
4. Write a business plan
5. Work out finance needed
6. Define directors and responsibilities
7. Assess strengths and weaknesses
8. Define business structure
9. Form a limited company

 

The steps after you start:

10. Open a business bank account
11. Build a brand
12. Create a website
13. Plan your marketing activities
14. Find premises
15. Get Insurance
16. Buy tools to help you do the job
17. Hire employees
18. Become a creature of habit

Checklist for before you start your company

#1 – Research

You should research the viability of your business idea, as well as who your target market is. You will also need to research who your competitors are and how your business idea differentiates from them. Once you have done this you should test your product to make sure your product is right for your target market and there is a need for your product or service.

You can find some testing methods in our previous article Escaping the nine to five: can I turn my passion into my business?

#2 – Think of a name

Your business name can come to you instantly or it may take longer to come up with. Either way you need to carefully consider what your business name will be as it can have a huge effect on how your business is received by your customers.

Here are a few tips to take into consideration when deciding on your business name:

• Keep your customers in mind – the name must appeal to your customers
• Think big – don’t restrict yourself to things like location, your business could go global
• Web friendly – how will your company name look as a web address and is it available?
• Be precise – choose a name that reflects your products or services and is not confusing
• Be unique – differentiate yourself from your competitors and stand out.

When you form a limited company, your business name is protected.

#3 – Secure your website domain

Securing a domain name should be considered before starting your business. Your domain name should be easily relatable to your business as well as memorable. Domains are relatively inexpensive.

#4 – Write a business plan

Writing a business plan gets everything to do with your new business idea in order. It helps keep you organised and focused at the critical development stage of your business.

A typical business plan includes:

• Market research
• Customer analysis
• Competitor analysis
• Product / service information
• Organisational structure
• Financial information

#5 – Work out finance needed

Some business can be started by using personal finances, some require more. You need to realistically figure out how much you will need to successfully start your business, this includes everything from premises to cost of living. You also need to consider the fact you may not make a profit for some time.

#6 – Define your directors and responsibilities

You may be starting your business alone, great, you will be the director and know that you hold all responsibilities. If you are starting a business with two or more people, you need to choose your company directors and what their responsibilities are when you form a limited company.

#7 – Assess your strengths and weaknesses

If you are starting your business on your own, you will need to be a master of certain skills in order to give your business the best chance of success. By figuring out if you have the necessary skills in areas such as organisation, communication, finance, IT, sales will give you a good idea if you need training to effectively run your business.

#8 – Define your business structure

Deciding what sort of business, you want to own is very important, you could be a sole trader, partnership or a limited company. Each one has its advantages but as limited company you have limited liability, they are tax efficient, potential credibility and prestige and pension possibilities.

#9 – Form your limited company

Once you have checked off all the above, it’s time to form your limited company. See the following articles for advice on this:

• Registering a company name

– A Small Business guide

• Forming a company: Choose your trading type

– Joanne Harris of accountants Nixon Williams shows you the different options when it comes to setting up on your own and working for yourself

• Employing company formation agents to ensure success

– Reasons for your small business to employ registered limited company formation agents.

Checklist for after you’ve formed your company

#10 – Open a business bank account

Now that you have a limited company, your finances must be separate. This is where business bank accounts come in. When selecting your business bank account keep an eye out for charges that may apply and what facilities the bank offer. A lot of banks offer other perks such as cashback too.

#11 – Build a brand

A brand is like your company’s identity or personality. This means you need to convey more than just your logo and themes; you need to convey your brands core values and beliefs in everything that you do and make sure your stake holders and customers understand them.

#12 – Create a website and get online

Building a website is not necessarily essential for every business, but a website has its advantages. It extends your reach to potential customers and customers tend to check out a business’s credentials, products and services by looking at a business’s website and online reviews. If your budget does not cover building a full website, you could consider building a holding page with key information and contact details.

#13 – Plan your marketing activities

You have a great product or service, but how will people know about it? With a marketing plan you should aim to increase your brand awareness and grow your business. Your marketing strategy should have clear objectives, messaging and target audience, as well as the marketing channels you will use.

#14 – Find your premises

You may need to start your business in commercial premises should you need the space for your business to grow, or you may only need to work from home. Either way you should consider the facilities, the proximity to your target market, transport links, licences required, and insurance policies needed.

If you decide to start your business from your home, you should take a look at The GOAT (greatest of all time) guide on how to start a home business. This guide will help you in setting up your business at your home.

You should also consider that your private address will be on the Companies House public register for everyone to see, should you have your registered address as your home address. To protect your private address, when you form a company with LegalZoom, you will get exclusive access to our Registered Agent service which protects your privacy.

#15 – Get insurance

Insurance for your business is critical and you need to get professional advice on what policies you need as they vary from industry to industry, such as liability insurances like professional liability and products liability which vary depending on your industry. You will also need to consider property and contents insurance, business interruption and theft.

#16 – Buy the tools to help you do the job

You will need tools and equipment that help you effectively produce products or enable you to provide a high-quality service. You will need to shop around to find the best deals and find out which tools and equipment are best suited for your needs. This can also administrative requirements e.g. telephone and IT requirements as well as fixtures and fittings.

Make sure you are on top of your financial data from the start. Accounting software will help you with minimizing you administration time. A few tools for Startups we recommend are:

#17 – Hire employees

You should hire someone to fulfil a role that requires a specific skillset. You will not only need to consider the financial implications of an employee’s salary; you will need to consider PAYE and National Insurance contributions along with pension contributions.

#18 – Become a creature of habit

There are certain aspects of your business that are one-off tasks. There are also other tasks that will require regular attention, some of which are:

• Updating your business plan
• Adapting you marketing strategy based on successes and failures
• Refine your target market
• Research new competitors and potential target markets
• HMRC returns
• Confirmation statements
• Up to date insurance policies

Summary and More Guides

Hopefully this checklist has helped get an idea of how to get your business off to the best start, even before you start your business, and the key areas to focus on and organise once you have started your company.

You should also check out our Start a New Business section which contains one set of guides on ‘Setting up your business‘ and another on ‘Getting your business going‘.

The post The complete checklist on starting a business the simple way appeared first on Small Business UK.

Being a sole trader means that you run your own business as an individual and are essentially self-employed. This is the most popular way of trading in the UK, with 3.1m sole proprietorships recorded at the beginning of 2022.

By contrast, a limited liability company is a separate legal entity to you, with separate finances.

Each option has its own advantages and disadvantages, and anyone starting out in business will need to decide what will work best for them.

Here, we look at some of the major differences in terms of legal liability, taxes and bureaucracy.

Also see: Should I go sole trader, partnership or limited company?

Liability

A key advantage of a limited company structure is that it ringfences your personal assets. If your business fails or is sued, you will only lose any investment in the business and won’t be personally liable for meeting charges such as litigation costs or damages from your own finances. Although, in some cases, lenders may require personal guarantees.

As a sole trader, you and your business are one single legal entity. You are personally liable for any debts and liabilities you incur in the running of your business, including taxes, putting you at greater financial risk should something go wrong.

However, the sole trader structure can offer some financial benefits.

Any losses you incur as a sole trader can be offset against your other income for tax purposes, something that can’t be done in a limited company structure as the company is a separate legal entity. For many business start-ups, where losses may be initially incurred while the business gets established and finds its feet, operating as a sole trader can provide an advantage by allowing you to offset any losses against other income to reduce your tax bill.

In addition, because your finances and those of the business are legally one and the same, it also means you can freely borrow from the business’ funds to cover personal expenses if needed. It is important to remember, however, that you will still be taxed on any profits you withdraw from the business.

Tax differences

Limited company taxes

Limited companies must pay corporation tax.

As of April 6, 2023 it’s 25 per cent, up from 19 per cent previously. This applies to businesses with profits of £250,000 or more and applies to all profits. A small profit rate is in place for companies with profits of £50,000 or less. A system of taper relief is in place for companies whose profits fall between these thresholds – find out how much you’d pay using the government calculator.

There are potential further taxes payable when extracting value from the business, including income tax and National Insurance Contributions (NIC), based on the salary you decide to pay yourself (which will be deductible against company profits) and taxes on any dividends (paid out of post-tax profits). You do, however, have control over the timing and method of extraction.

Sole trader taxes

For sole traders the tax rules are different. You will pay income tax on the profits of your business regardless of whether or not you have extracted those profits for personal use or invested them in the business.

In addition to paying income tax on the business profits, sole traders, being self-employed, must also pay Class 2 NIC (£3.45 a week in the 2023/24 tax year if the Lower Profits Threshold of £12,570 per year is exceeded) and Class 4 NIC (9 per cent on profits of the business between £12,570 and £50,270 in the 2023/24 tax year, and 2 per cent on profits over £50,270). You must also register for VAT if your taxable turnover is above the VAT registration threshold, which is £85,000 in 2023/24. This is all calculated and reported to HMRC via the annual self-assessment process and completion of self-assessment tax returns.

Also see: 5 most common tax mistakes when you’re self-employed

Key differences

Due to the lower corporation tax rates, especially for businesses with lower turnover, limited companies are generally taxed less on their profits than a sole trader and therefore tend to be more tax efficient. This is especially so if the profits are invested back into the business rather than extracted, as profits ploughed back into the business are taxed at a lower rate than would be the case if a business operated as a sole trader.

Limited companies can also offer a wider range of tax-free benefits to directors and employees and open up access to certain tax reliefs that aren’t available to sole traders, such as R&D tax reliefs.

However, unlike a sole trader, money cannot be borrowed from the business’ bank account for personal use with impunity. Doing so in a limited company will be considered a ‘benefit in kind’ and carries potential tax ramifications.

Bureaucracy

While a limited company structure offers limited liability and potential tax advantages, it involves more bureaucracy to set up and manage, which you will either need to spend time doing yourself or paying others to do for you.

Overall, a limited company structure comes with more reporting requirements and, as a quid pro quo for the benefit of limited liability, the directors of the company have a wide range of duties and fiduciary responsibilities, which can, in turn, create additional costs and paperwork.

For example, as a director of a limited company you must register the business with HMRC and are legally required to set up a separate company bank account. Accounts must be prepared each year and submitted to HMRC – and they may need to be audited. This offers less privacy, as these accounts are publicly available to everyone online via Companies House, along with your details and those of any other directors.

However, the limited company structure offers greater flexibility in the way you can allocate shares and employ people, allowing you to issue shares in the company to spouses and family and/or appoint them as salaried directors to improve tax efficiency. A corporate structure can also help to create a more professional impression to your clients and suppliers.

Due to the additional formalities in forming a company, setting up as a sole trader is the simplest way to get your new business off the ground.

To become a sole trader, you must register with HMRC as self-employed. This consists of a straightforward online registration form. Timing does matter, however, since there can be financial penalties if you fail to register before the end of the relevant tax year once you’ve started trading.

Unlike in a limited company structure, as a sole trader you aren’t legally required to open a separate business bank account. That said, it’s generally advisable to do so in order to keep better track of business income and expenditure and assist in preparation of tax returns.

Sole trader profits must be calculated for each tax year (April 6 – April 5). Like a limited company, accounts (i.e. a record of business income and expenses) must be prepared to determine the profits of the business, but unlike a limited company they don’t need to be audited or submitted to HMRC, unless specifically requested.

It is possible to change from a sole trader to a limited company, and vice versa, but it is usually easier to start as a sole trader and incorporate later rather than the other way around.

Ultimately, it is important to think carefully about what works best for you and seek professional advice if you’re unsure. Having the right structure in place to suit your specific circumstances and ambitions will put you on a strong footing for future success.

Haydn Rogan is a tax law specialist and partner at national law firm Weightmans.

Read more

Registering your business: sole trader or limited company? – Here, we speak to four small business owners about the decisions they faced when registering their company and what influenced their choices 

Sole traders and VAT – Whether you pass the VAT threshold or register for VAT voluntarily, we explain everything you need to know about Value Added Tax 

9 accounting software platforms for Making Tax Digital – Here, Mariah Tompkins scrutinises accounting software options that small businesses can use for their digital tax returns. 

6 tax breaks every small business should know about – You could add thousands of pounds to your small business bottom line by applying these little-known tax breaks 

The post Tax advantages of a limited company versus sole trader appeared first on Small Business UK.

The way we dine out has been transformed in the last decade with independent cafes and restaurants opening on every corner and food stalls booming throughout multiple UK cities.

As an entrepreneur who is thinking of opening a restaurant, it is important to consider the time, money, legalities and commitment needed to start a food business. However, many of these considerations are often forgotten.

Many food businesses that start as an idea and quickly grow into a brick and mortar venue without sufficient planning can often face hurdles in the future, such as cash flow problems and even liquidation.

It’s frustrating for any business owner to see their hard work dissolve, so by seeking professional advice and investing in time to set up your business properly, you have a better chance of running an effective and profitable restaurant.

Small Business Pro is the ideal tool for you when you’re starting your business. It will help with the heavy lifting of managing customers, taking payments, insurance, finance and HR, plus you’ll get a host of personal wellbeing benefits.

You can find out more about Small Business Pro here.

Here are 11 ingredients for a profitable restaurant start-up, from Bobby Kalar, managing director of Yu Energy.

1. Deciding on a concept

You may have an idea already in mind or you may still be at the drawing board, but choosing what type of restaurant you want to offer, your target audience and its unique selling point are important to think about when creating a restaurant concept.

Dev Biswal, owner of The Ambrette restaurants in Kent and Sussex, explains why it is important to decide on your restaurant’s ‘voice’.

‘The voice of your restaurant, which encompasses its values and aims, will differentiate it from the competition; it’s your USP.

‘It’s essential that entrepreneurs establish their restaurant’s character early in the process and then ensure that this ‘voice’ is present in the dishes, the menus, the marketing and that it is conveyed by the staff.

‘At our restaurant we design our menus with the aim of challenging perceptions and educating diners about the food in front of them.

For example, our recent detox tasting menu showcased the nutritional benefits of spices such as cinnamon and nutmeg and I took the time to explain this to diners in the hope that they leave my restaurant knowing how to boost their well-being using these store cupboard ingredients.’

2. Market research: Competitor analysis

Having an idea for a business is all well and good, but without sufficient research you could be opening a restaurant that your target market has no interest in, there’s no guarantee that you will receive a return on your investment.

Regardless of your chosen industry, it is important for anyone with a business concept to research their competition, customers, funding options and profitability as a business prior to investing hard work and time into an idea that may already be out there or isn’t profitable.

Primary research taken from customers in your region can be far more accurate than sourcing secondary information because while data may be insightful, it might not apply to your unique concept.

For example, a survey taken in Manchester about the number of people who would visit a new gourmet burger restaurant could collect a very different opinions to an identical survey of Birmingham residents. Therefore it is valuable to conduct your own, real research on potentially new customers in your area.

3. Business plan

Business plans are essential for structuring your business model, clarifying direction, attracting financing and team members, as well as being a document that you are able to refer back to during the everyday management of your restaurant.

Many entrepreneurs are often daunted by the thought of creating a business plan to support their idea, however there are plenty of resources out there that are helpful to read when writing a business plan.

What’s more, a business plan doesn’t need to be excessively long; it is acceptable to write just a few pages if it includes everything yourself, your employees and your investors would need to know about your concept, finance and marketplace.

4. Funding a restaurant start-up

Finding the funding to get your food business off the ground can be difficult. In 2012 a study by the Federation of Small Businesses (FSB) found that 42 per cent of small businesses that applied for a loan were turned down.

Since then, there has been a rise in successful funding initiatives for startups, including The Prince’s Trust, Funding Circle, and increased government grants for small businesses.

Related: Sources of funding to open a restaurant

Rob Martyniak, co-owner of Meatcure talks about the financial challenges entrepreneurs typically face when opening a restaurant.

‘One of the main challenges you’ll face when opening a restaurant is the financials to fund your business. The financial investment is often why so many great ideas never become a reality.

An entrepreneur is simply someone willing to take the steps to crafting their dreams when others aren’t, or are, intimidated by the financial commitment. However the financial injection you put into your business idea doesn’t need to be excessive.

‘At Meatcure we build, design and create everything in-house ourselves. We have invested time into learning our craft independently, from installing the toilets, building the bar to creating the perfect patty and brioche marriage.’

5. Premises

Finding the perfect premises for your business can be a challenge as it’s dependent on many factors: where you want your restaurant to be, the type of building you want your restaurant to be in, where your customers are mostly likely to be based and how much money you have to purchase or rent.

Choosing a property based on your business concept and ethic is a sensible method of ensuring your restaurant will please your own objectives and your customers’ expectations.

If your brand is passionate about energy saving, you may opt for somewhere with a high EPC rating or is completely powered by renewable energy.

If the purpose of your food business is to offer fast, healthy and easily accessible meals to workers at lunchtime, it would be sensible to find premises in a city centre where your target market is likely to be.

6. Utilities

Utilities were the second cause for rising business costs in 2015, with labour taking first place, in a recent study carried out by the Federation of Small Businesses (FSB).

With running costs, including electricity and gas, being one of the biggest overheads for restaurant start-ups, it’s important to choose the correct supplier for your business.

There are so many utility providers out there that it can be difficult for businesses to understand what they want from their supplier.

The ‘Big Six’ are a popular choice for most due to their existing client base and fairly good introductory offers. However what the ‘Big Six’ stand out in popularity, they often lack in customer service and reliability.

Choosing to opt for an independent utility provider is proving a popular and wise choice for many start-up businesses, who are benefitting from the unrivalled customer service provided by flexible suppliers, often at a considerably lower price than leading electricity and gas giants.

Restaurant owners increasingly say that finding a supplier that offers flexible energy contracts to suit their individual needs is more important to them than sticking with a well-known company because they think it’s easier not to switch.

Apathy is the enemy of any successful business, and this applies to utility bills too. If an owner doesn’t get the deal they deserve from the start then they’re setting themselves up for difficulty later down the line. They need to talk with their feet and take control of their own energy from day one.

7. Equipment installation and maintenance

To run an efficient restaurant business you need equipment that you can depend on. Investing in good-quality apparatus at the start will ensure that maintenance and repairs are kept to a minimum in the long term.

Choosing the most appropriate supplier to service your appliances can often be something that many restaurants forget about. Alex Wrethman, owner of Charlotte’s Group expands on this point.

‘The biggest challenge for someone opening a restaurant has to be building a list of contacts and suppliers that are invaluable to your business. For someone who isn’t already in the restaurant industry, it can be difficult to build a network you can work with and trust.

‘The relationship you have with your suppliers is most important; knowing that you are only a phone call away from a reliable electrician or food supplier is valuable for any restaurant.

‘When choosing suppliers, customer service should be your main deciding factor. Being able to put a name to a face is such an important part of having reputable suppliers for your business. Knowing your restaurant is cared for by your suppliers is something that is priceless to any business.’

8. Regulations and licenses

There are several licenses that you may require to start your restaurant business. These include:

• PRS for Music license: If you, or anyone else, plays music for customers, visitors or staff, you need legal permission from the relevant copyright owners. This license can be obtained from PRS For Music.
• Alcohol license: An on-license must be granted for an establishment to sell alcohol that must be consumed at point of sale. This license can be obtained through your local government website.
• Food hygiene certificate: This certificate proves that you are aware of and operate under the appropriate food hygiene and health and safety regulations.
• Public liability insurance: This protects you if your customers suffer personal injury or property damage because of your business. Public Liability Insurance covers legal expenses or compensation claims and is essential for businesses that interact regularly with customers.
• Building permit: If you intend to construct your premises or add to your existing structures, you will require a construction permit.
• Food premises approval – If your restaurant handles meat, fish, egg or dairy products, you must be inspected and approved by your local council. You can apply for this license through the government website.

9. Staff

Working as a team is an important part of any hospitality business. Restaurants can often spend a third or more of their revenue on staffing, recruitment and training, so it is important to factor in these expenses when thinking about opening a restaurant.

Recruitment can be a difficult part of starting your own business because you are competing against bigger, more reputable brands for the best staff.

However, this problem can be resolved by ensuring your job descriptions are transparent and include that you are a newly-opened restaurant. Applicants are often intrigued by the growth prospect of working for a start-up, so it can beneficial to explain your vision as a small business to your potential staff members.

10. Promotion

Similar to competing for staff, you are also against other restaurants when it comes to promoting your brand. It can be difficult as a new business, without the reputation and authority that your competitors already have, to stand out from the crowd.

It’s important to remember that as a small, startup food business, you’re speaking to an interested audience! In a recent survey carried out ahead of Small Business Saturday, a quarter of people (26 per cent) said they were more likely to shop at local, small businesses than five years ago.

This increasing figure shows that consumers are willing to visit independent businesses, including restaurants: by communicating the passion and ethic of your brand through your marketing materials, you can draw them in your direction.

11. Go digital

Recent years have seen some excellent developments in software and systems designed to optimise the management of hospitality businesses, including some specifically for restaurants (of all types – from fast food establishments to formal dining).

A good EPoS system should help you manage all aspects of your restaurant and the data that is generated give you a useful overview of how your business is performing. Typical elements POS software is designed to help with include: reservations, taking and assigning orders, inventory management (stock levels and usage to reduce wastage), ordering management, staff scheduling and performance, tracking labour costs, taking payments, customer engagement and marketing, kitchen management, and business analytics and reporting.

There are a good number of EPoS suppliers in the market to choose from and as mentioned earlier, some are specialists in the hospitality sector, tailoring their offer by restaurant type.

EPOS Systems for Restaurants

Development is still ongoing, so look for a supplier that is updating its software and hardware configurations on a regular basis. One of the latest advances we have seen is from JeM that uses artificial intelligence (AI) to forecast sales using trend analysis.

See also: Best restaurant booking systems for independent businesses

Once these eleven steps are all this in place, you can concentrate on the part you know best – the food.

List of useful resources on starting a restaurant

• Starting up a restaurant: The considerations
• Menu tips 1: How to write great menu descriptions
• Menu tips 2: What to consider when writing a menu
• Kitchen equipment: A ‘Top 20 checklist’ of the essentials for a modern commercial kitchen
• Wholesale food suppliers: Some useful tips on choosing the right suppliers for your type of restaurant
• Restaurant franchises: A selection of UK franchise opportunities. Not all of them are strictly restaurants (does ‘Wendy’s’ really count as a restaurant?) but there are more typical restaurant style businesses available (e.g. Cafe Rouge, Bella Italia etc.)

UK Food & Drink Shows

For those still brave enough to start a new restaurant we recommend you see our article: How to reopen your restaurant, pub or hotel post-lockdown. It contains lots of useful advice that would also pertain to anyone opening a restaurant.

Most importantly, the article lists out the new specific operating guidelines from the UK government, as well as the draft recommendations from trade association UKHospitality.

The post Opening a restaurant: The key ingredients to start-up success appeared first on Small Business UK.