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The stress of success
Are you the type?
The business plan
Raising the cash
Time and motivation
Help and info
Imagine having your own business. You could stay in bed for ages every day, mooch around shopping and give yourself holidays whenever, right?
Wrong. Running a business is very hard work, particularly when you're starting out. Richard Branson may now be able to afford to spend a little time on his own tropical island, but he was so busy with his first business plan – for a school newspaper – that he dropped out of school.
This isn't generally considered a smart move, even for entrepreneurs. Branson's headmaster told him: 'You'll either wind up as a convict or a millionaire.' Fortunately for Branson, it was the latter – he's now worth about £2.2 billion.
VEE-TV talked to Tom Page-Phillips and his hearing brother, Ben, who recently set up their own business: a soup café called Nincomsoup in Old Street, London EC1.
'It mainly came from having fantastic soups from our mother,' Ben says. 'So later when I was thinking about good business ideas, I thought: soup. It's good, it's quick and you can carry it easily.'
Ben's and Tom's working day starts at 6am, and they each put in more than 105 hours a week. Just for starters, they help in the kitchen, make deliveries and do the accounts. Ben says that both deaf and hearing customers were supportive when they opened, in March 2001. 'They were particularly keen for us to succeed and would suggest their preferences, which helped us a lot.' In fact, at first Ben and Tom were too successful: they didn't have enough staff to cope with the demand and had to close for a while. 'It's a hard business and a huge learning curve,' says Ben. 'It's only now that we're reaching our targets and paying off some of our bills. It's very stressful for us.'
Tom admits that communication with the customers can be a problem: 'It's a really fast-paced environment.' But Ben helps out if necessary.
Other deaf people have applied to work at Nincomsoup, but so far no one's had the right experience. In the meantime, staff are given deaf- awareness and sign-language training (by Ben's deaf girlfriend, Samantha) and there's a daily average of 12 deaf customers.
If you're interested in starting up your own business, perhaps the first thing to do is ask yourself whether you've got what it takes personally. For instance:
• Can you motivate other people?
• Can you deal with responsibility?
• Can you handle the long hours, particularly at first, and the stress?
• Will you be able to survive without regular money coming in while your business gets established? Most businesses fold in the early stages because of cash-flow problems. (See Raising the cash, below.)
Next, you need a business plan. Basically, this means writing down your ideas about the business, where it will be based, how you will advertise it, who your customers will be, and how you think it will work, including what everything will cost, how long it will be before you start making money, and how much you can realistically expect to make over what period. You'll need to do as much research as you can into your potential costs and the market in which you will be competing. HSBC advises that looking in your yellow pages can be a useful starting-point, so you know what other businesses are in your area.
See Help and info for more sources of information about business plans. Your bank should also be able to give advice.
To get the Nincomsoup idea off the ground, Ben sold his house and put all the money into the business. It's a big risk: if they don't succeed, he won't get his money back.
Around 7% of new small businesses in England and Wales are started by people under 25, and many of these young people have to go to a bank to borrow start-up money. Liana Wallace, a spokeswoman for the HSBC, told us that they take young entrepreneurs very seriously. There is no maximum amount for a new business loan: what they decide will be based on each individual case. Of course, not everyone gets a loan.
The main thing is that your idea needs to look as if it's going to make money. But banks will be looking for experience too. If you've got the idea but no experience, good qualifications may help, and a good business plan and lots of commitment and enthusiasm are essential.
The three banks we spoke to – HSBC, Nat West and Barclays – all said they would arrange and pay for a sign-language interpreter for meetings if given notice.
One possible alternative to funding from banks is to go to The Prince's Trust, which specialises in helping people aged 18-30 who may have been turned down by banks or who may be unemployed, under-skilled or have other reasons to make getting started a bit harder. The Prince's Trust offers financial support for research and business-plan preparation as well as business start-up grants.
Adam Evans started his own courier service with a grant. 'The Prince's Trust awarded me a start-up grant for £5,000, but that's not all,' he says. 'They also provide me with regular support, such as meetings with my business mentor for one-to-one contact. We meet for lunch and have e-mail contact. If I have any business dilemmas or admin or marketing queries, they are always there for you. So compared to a bank, there's a big difference.'
Ben Page-Phillips of Nincomsoup warns that setting up a business involves big sacrifices. 'One thing to think about is time, because you won't have any time,' he says. 'You won't be able to go for a drink down the pub and you can say goodbye to your friends for at least one or two years, maybe 10 years. If you're happy doing that, then fine – go for it.'
Adam agrees. People interested in starting a business should 'do their market research, have a very good business plan and be prepared to work long hours,' he says. 'I work 90-100 hours a week. But, overall, you have to be motivated.'
Business Link
www.businesslink.org
Government website providing practical business
information and advice to small firms. Includes information on starting
up, IT and e-commerce, financing, regulations and tax.
Channel 4's The Real Deal
www.channel4.com/realdeal
The Real Deal is the place where people with great ideas can go to
find out how to stand on their own two business feet. The site features
a personality test, 'road-tests' for your business idea, and advice on
who might invest in your business and how to approach them.
Insider's guide to starting your own business
www.totaljobs.com
To get to the pages on starting your own business, click on 'Insider's
Guide' on the pull-down 'get advice' menu on the home page, then scroll
down to the bottom of the page.
The Prince's Trust
18 Park Square East
London NW1 4LH
Voice: 0800 842842
Fax: 020 7543 1200
Textphone: 020 7543 1374
E-mail: info@princes-trust.org.uk
Website: www.princes-trust.org.uk
Aims to help people aged 14-30 to develop confidence, learn new skills
and get into work. The section of the website dedicated to starting your
own business features details of the loans, grants and other services
available.
Graphic version
Includes layout and images.