When you set up a business you're taking a risk as to whether your business will work. Usually, if a start-up is going to fail, it will do so in the first 12 months.
Aim to reduce the risk of your start-up failing by testing your idea. This is important particularly if you're looking at finding funding or a business loan to help set up your business, as you'll need to convince the investors that you have done your research to find out whether your idea has a reasonable chance of succeeding when it is brought to market.
If you've invented something new whether it's an idea, service or a physical product that doesn't already exist, register your idea to make sure that nobody replicates it. Visit GOV.UK - Trademarks, Copyright and Intellectual Property to find out more.
Whether your business idea is original or not, you'll still need to research the market you're looking to enter and identify potential customers to test out your idea. This is to find out if there is real demand for your product or service.
Find out the needs of your potential customers, create a prototype of your product, then go back to these customers and get feedback about your product or service.
Larger companies test their ideas for years and spend large sums of money on research to test the market before launching their ideas. However, you don't need to spend a lot of money, employ a market research company, or go out with a questionnaire and ask hundreds of people on the street to do your research. Find out about some low cost ways to research the market at The Start Up Donut - Market Research .
If you need to secure funding either through a grant or a bank loan then your business plan must be strong enough to convince funders to invest in your idea. However, that doesn't mean that when you bring your product or service to the market you will satisfy your customer's needs profitably.
Setting up an online business is similar to setting up a physical business - you still need a business plan and to find funding but there are additional things to consider. It isn't just a case of buying a domain name, setting up a website and then watching orders for your product or service come in. You must think about how you will market your business.
Begin by writing a business plan. For advice and guidance see how to write a business plan. Before you spend money on a domain name and building a website find out if your idea will work. This means consider your market, check out your competition, and think about who your target market is.
Once you've done some research you can buy a domain name. There are a number of providers that sell these including Go Daddy. Prices vary with a .com name costing from £6.99 for one year to £9.42 for ten years.
Getting someone to build your website can prove expensive, costing anything from £500 to £20,000. Speak to friends and family to find out if anyone can recommend a web developer who can produce what you need for a reasonable price.
It can take a long time for a web business to grow but with patience and a well laid out marketing plan you will find that work will come in.
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