Chris Annis, LB Group – from Suffolk Business

August 2009

Successful entrepreneurs make it look easy. They start with a good idea, launch it to their target audience and the cash rolls in. If only it were that simple!

Chris Annis of LB Group, chartered accountants and business advisers, says the reality is very different. Only 50 percent of new business start ups are still trading after three years. In the current economic climate, starting up your own business can seem even more daunting.

However good your idea, however strong your motivation, there are tried and tested rules. Get it wrong and you're just another statistic. Get it right and you might take your place alongside Peter Jones and Deborah Meaden on Dragons' Den!

• Know your market: before investing time and money, ask yourself:
• Who will buy my product/service?
• What would they pay?
• How much will it cost to provide my product/service?
• Watch the cash:
• Spend on what you need and delay all non essentials
• Control and forecast what you are going to need. Early identification of cash shortfalls is key to survival
• Identify how you can raise more finance
• Identify how and when you can repay any such finance raised
• Find a mentor: many successful business people admit they'd have stacked the odds more in their favour if they'd taken advice. Find a good accountant, bank manager or experienced businessperson.
• Work to a plan: even if your objectives change over the longer term.
• Budget and forecast: acknowledge what's realistic and analyse business performance against this. Identify why you didn't achieve your goals and where you overspent or under invested.
• Be your own business analyst and ask yourself:
• What could you do better?
• What is your most profitable source of business?
• Is the business viable in its current form?
• What is your competitive advantage?
• Where do you want to be?