There are over 5 million self-employed people in the UK (Source: Office of National Statistics). Many others want to work for themselves and use their skills to become financially independent.
Make A Plan
Of course, some people become self-employed due to job loss or redundancy. In these cases, there isn’t a lot of time to plan your launch into the self-employed world.
If you are currently working then you have the luxury of a bit more time to make a business plan and save some money. Depending on your field of expertise you will need the correct qualifications, insurance and potentially FCA compliance training through a company like Scott Robert. Solid planning at the outset will save you both time and money and should include:
- Market research on your chosen area
- Marketing plan
- Budget and projections for the first 12 months
You can use your business plans to apply for any relevant grants or funding to help you set up your business.
Financial pressures can cause a lot of tension which can affect your business. Take the pressure off yourself by saving up enough money to cover expenses for at least six months.
Get Your Qualifications Up To Date
Most industries will have their own standards and accreditations that you will need to complete. Although experience is the main thing, some people are going to want you to have these accreditations and if you’re tendering for a contract, they might be a prerequisite.
Look to update your skills outside of your chosen field too. There are many free courses you can take online that can improve your business and marketing skills. Now that you’re working for yourself you’ll have to wear many hats and learn a plethora of new skills.
Make it official and tell the government you’re self-employed. Contact HMRC within three months of starting to trade. You’ll need to decide if you’re going to be a sole trader or a Limited Company, in which case you’ll need to register with Companies House. There are pros and cons to each. You need to work out which one is more suitable for you. You can always change from a sole trader to a limited company at a later date. You can switch back too but there are a few more hoops to jump through first.
Take the free online training on the HMRC website and make a note of any relevant dates for tax returns. Don’t leave it until the last minute to file any returns, especially if it’s your first time doing it if you run into any problems you might not be able to resolve them in time and end up with a fine.
Open A Business Bank Account
It’s so easy to open a business bank account now. You can do it in minutes and run your account entirely from your phone. Some of the most popular include Monzo, Coconut and Tide.
Many of these accounts have basic invoicing and expense tools built into them, so if your business only has a few, simple transactions, then these can handle most of your financial accounting needs.
These new challenger banks are often cheaper too and are either free to run or can cost around £5 per month, a lot cheaper than a traditional high street bank.
Choose An Accounting Software
There are many accounting packages out there that you can connect directly to your bank account. It will make preparing your end of year accounts much easier and some of them even run payroll and connect directly to HMRC. Packages suitable for self-employed include:
- Wave Accounting
Get Professional Liability Insurance
This is a must-have for self-employed consultants. It will cover you if a client tries to take you to court over a problem with your work. Many companies will insist that you have this insurance before working with you.
In some circumstances, you may need public liability insurance as well. There are many specialist insurers online that can provide you with a comprehensive policy to suit your needs.
Set Up Your (Home) Office
Many self-employed people start their businesses from their homes. Even if you’re planning on working from home, you’re going to need to buy a few things to run your business.
Separate a space for yourself at home that is purely for work, even if it’s the corner of the dining room. You’ll find it easier to focus when you’re working and switch off at the end of the day.
Choose A CRM System
Having a system to keep track of current and potential clients is a good idea. Hubspot provides a free version that you can scale with you as you grow. Use your CRM to track all of the contacts your have with people, what was said, when to follow up, and other tasks.
Use your CRM from the start rather than when you find yourself with too many contacts to juggle. That way, you’ll be able to familiarise yourself with the system from the start.
Create Your Marketing Plan
Even if you’re not a marketer, you’re going to need to have a plan to promote your business. One of the best ways to do this is to start by creating your buyer personas.
A buyer persona is a semi-fictionalized depiction of your ideal client. It goes into great detail about their background, job, communication preferences, pain points and possible objections to using your service. Here is a template from Hubspot to help you create yours.
Once your personas are in place, you can plan the rest of your marketing material around addressing your buyer personas.
Your website should also be informative and well written from an SEO perspective to help it get found on Google. Make it easy for people to find out information and contact you through your website.
Sort Out Your Online Presence
In order to get your business found online, you’re going to need to build a presence online. Start with your Google My Business listing, LinkedIn profile and website. If you have the time and experience, set up your social media profiles too. Don’t simply set up an account on every platform for the sake of it.
Do your research to find out where your ideal clients are and choose one of two social media networks to concentrate on.
Once you’re up and running, you can look to potentially outsource your marketing to make the most out of your marketing.
Many businesses get clients through networking and word of mouth. You need to get yourself out there and start networking both with your peers and where your potential client’s network.
Check online for local business networking groups in your area. There are also many to be found online on Facebook and LinkedIn. They are usually very supportive of new members. Try joining Freelance Heroes, a community for self-employed people to swap advice and tips.
Some people are naturals at networking and you might not think you’re very good at it. The truth is, most people have to learn how to network well, it doesn’t come easily. When it comes to networking, practice does make perfect, especially if you’re a naturally shy or introverted person.
Setting up in business for yourself is exciting, but there’s a lot of admin to do too. Getting your processes in place from the beginning will make things a lot easier than trying to do it when you get too busy.