Start-Up Help...

[johnnythunders]

Hey Everyone (sorry if this isn't the correct place to post in. I did have a good look down the list and didn't see a relevant forum and so  figured this was the best one to post in. But excuse me if it is not).

I'm an electrician based in London and me and two mates (electricians also) want to make a go of going it on our own. We've not yet registered our business name (are still fighting over who has the best idea!) but will do so within the next fortnight. We also need to set up a website but are not able to do it ourself (we're all a little backwards and english isnt our strength). Can anyone who is already in business please recommend a good site that will take care of everything for me and not too pricey. Also, if anyone can advise on any pitfalls i must look out for, red flags or companies not to use I'd be especially grateful.

Any responses will be really appreciated - JT

 

[binky]

 a basic website can be put together for not much money by a website builder. Compared to the likes of 1&1 it may seem expensive, but website designers do know  alot more about getting your website found by search engines like Google. It will take months to get recognition from these companies and your webiste searchable.

 

[Evans Electric]

I can't help you with  website advice  , other than I get two or three calls a week from people who want me to have one .  

What I can say is , three sparks starting up could end up as a nightmare ...........or it could be the start a wonderful relationship and every day you all march off to work singing the "Hi - Ho -Hi- Ho its off to work we go "  song  from Snow White ...accompanied by cartoon Bluebirds  and dancing rabbits   . 

There are many pitfalls like  who is in charge ,  how do you share profits , who runs  things day to day ?   Someone needs to be sent to a job urgently , who says who is to go ?   ONe of you will automatically rise into a leadership position and may end up meeting clients ,  typing up quotes , chasing late payments while the others begin to resent it .    

Be prepared for interesting times .

 

[Murdoch]

You will need to be limited and VAT registered......

 

[Lurch]

You will need to be limited and VAT registered......

I mean you could do those things, but you don't have to be. I get the limited part, but why the VAT registered?

 

[Murdoch]

I mean you could do those things, but you don't have to be. I get the limited part, but why the VAT registered?

The threshold for VAT is £84k which isn't much when there are 3 of you.....

 

[user 28595]

BeanBalance are OK for your business as they come with the accounting stuff ready to go and you can do the company set up at the same time.

http://www.beanbalance.com/

Don't forget to set up a business bank account to go with the company and agree how much each of you are going to pay in to the account and who will manage it / pay suppliers day to day.

cheers, Paul

 

[user 28595]

All three of you must be directors of the company so you are not bound by minimum wage restrictions - directors can be paid as much or as little as you decide.

cheers, Paul

 

[johnnythunders]

 a basic website can be put together for not much money by a website builder. Compared to the likes of 1&1 it may seem expensive, but website designers do know  alot more about getting your website found by search engines like Google. It will take months to get recognition from these companies and your webiste searchable.




 

Thanks Blinky... much appreciated.

 

[johnnythunders]

I can't help you with  website advice  , other than I get two or three calls a week from people who want me to have one .  

What I can say is , three sparks starting up could end up as a nightmare ...........or it could be the start a wonderful relationship and every day you all march off to work singing the "Hi - Ho -Hi- Ho its off to work we go "  song  from Snow White ...accompanied by cartoon Bluebirds  and dancing rabbits   . 

There are many pitfalls like  who is in charge ,  how do you share profits , who runs  things day to day ?   Someone needs to be sent to a job urgently , who says who is to go ?   ONe of you will automatically rise into a leadership position and may end up meeting clients ,  typing up quotes , chasing late payments while the others begin to resent it .    

Be prepared for interesting times .




 

I'm sure it'll end up as a nightmare. We've already almost come to blows over the company name. My business partners are not the brightest sparks out there... I'm sure I could find a way to electrocute them in turn. Should get an insurance pay-out as well if we set up properly. Will be interesting indeed...

BeanBalance are OK for your business as they come with the accounting stuff ready to go and you can do the company set up at the same time.

http://www.beanbalance.com/

Don't forget to set up a business bank account to go with the company and agree how much each of you are going to pay in to the account and who will manage it / pay suppliers day to day.

cheers, Paul




 

Thanks Paul... I'll have a look over them this evening.

 

[Andy™]

if you are arguing over something before you start, it will not end well

 

[phil d]

If you are arguing before you start then don't bother! mates that are great drinking buddies or workmates can be a nightmare to run a business with, a leader will naturally come to the fore and this is an unavoidable fact which others may resent. While it's true that you should all have an equal say in the running of the firm there needs to be someone in overall charge on a day to day basis. There is no point in a client ringing up to discuss a job with one of you and the next time they ring they speak to someone else, it won't work! When I had my previous firm there were 2 of us, if I started off dealing with a client then I always dealt with them, occasionally my business partner would deal with someone and then he'd deal with them all the way through the job. there is nothing more annoying when dealing with a firm and one bloke says, "oh yes, we can do so and so this way" then another bloke comes along and says "oh no, we're doing it this way". Also never promise something if you can't personally see it through, again this causes annoyance to the customer, even something as simple as a phone call, if you tell someone you'll ring them back at 4 o'clock then you ring them back, don't leave it to someone else, as one of my old bosses used to say, "it's not just about putting the kit on the wall" .All too often you hear people complaining, not about the job but about what it took to get the job done.

You need to sit down and agree your roles within the business before you start, who's responsible for what on a day to day basis, I've been a worker, a manager and ran my own business and each one has clearly defined roles. When I was a manager I  sat down with the guy who owned the firm and agreed what my limits would be within the firm, suppose you make a go of it and end up taking on staff, there's no point in one of you letting the staff do things one way and the other wants them done differently.

Also what about working, have you sorted that out? Running a firm means the job doesn't stop at 5 pm, whose doing the out of hours, can you split it fairly? Quite often the simplest thing can cause a fall out, lets say a friend that you all know is getting married and you all get invited to the wedding, who's going to be the one on call? because you can't just drop business for that day. I once took a fairly large job from a firm simply because the client had requested an electrician be sent to handle a small problem. The firm in question decided that in their opinion the call could wait until tomorrow, the client thought otherwise and ended up ringing me, I went out and sorted the problem. A couple of weeks later there was a job worth a couple of grand that the big company had been looking forward to, they didn't get it, I did. Remember what may seem insignificant to you may be a big thing to a client. An outside light that may be broken may not seem worth going out to at 8pm on a Friday night, but if someone rings up and wants it fixed there and then, then you have to go.

And finally always treat a client and their property with respect, it may be a small terraced house, a mansion, or a large factory, treat every situation the same, if you wouldn't do something in your own house, don't do it in someone else's. Good Luck.

 

[johnnythunders]

if you are arguing over something before you start, it will not end well

That's true. Though starting off on good, loving terms doesn't end much better: just look at marriages. My wife shot through after not even two months. 

 

[Murdoch]

Re your website... All you need is as web site with your basic details on it. Don't bother with this seo carp ..... It's a waste of money.... Spend your time and effort developing a decent reliable reputation and you won't need a website....

 

[Doc Hudson]

Do you have some potential customers already lined up, what sectors are you aiming for, Industrial, Commercial, Agricultural, Domestic etc? What budget have you set aside for advertising, marketing, promotion, websites etc. and what return do you expect to get from that investment. These sort of factors can determine what type of  internet presence to aim for. You have to remember the basic business truth that It is not what you know, but more about who you know. Using the internet to find a random unrecommended company is generally the last choice in anyone's selection. Be they a private domestic customer looking for an extra socket or company boss needing a new machine connected. First place selection is normally personal knowledge then friends or family recommendations. Which comes from building a good reputation as Murdoch suggests. Most businesses benefit from an internet presence, but also no website can be better than a bad website. If you have a site that is expensive to manage, out-of-date content, links not working, it can be a drain on your funds and put potential customers off. An established company with good contact details, some customer reviews or recommendations, and an outline of the work they cover is probably better than a new start-up, giving only a mobile and e-mail contact, no customer references and pages of repeated content giving every possible combination and permutation of work you hope to do. Have you checked for any local community forums in your area or Facebook pages, These typically can be set up for free and may be a quicker option whilst you concentrate on getting a few good customers established, recommending your business for you.

Doc H.

 

[steptoe]

Two plumbers I know worked together as a team for a firm, and they were a heck of a good team together so they decides to go on their own,

Set up a ltd co as a partnership, it started off well,

But, one of them did almost all getting the work in , sorted money etc,

The other guy thought he could just work the hours he wanted to, but. He also wanted to draw a 'proper' wage every week, just like his last job, even when they were struggling waiting for payment he still expected his wages, and paid for his days off etc, it didn't end well. 

The 1st guy ended up buying him out and being left with about £10k of company debt,

I've been offered loads ioff times a cash injection so I can chase bigger jobs, I don't want anyone else having a say in my co, I've seen the mess it can end up with a clash of ideas, 

The theory behind it is good, but you know the old saying

Never work with family or friends

 

[johnnythunders]

Two plumbers I know worked together as a team for a firm, and they were a heck of a good team together so they decides to go on their own,

Set up a ltd co as a partnership, it started off well,

But, one of them did almost all getting the work in , sorted money etc,

The other guy thought he could just work the hours he wanted to, but. He also wanted to draw a 'proper' wage every week, just like his last job, even when they were struggling waiting for payment he still expected his wages, and paid for his days off etc, it didn't end well. 

The 1st guy ended up buying him out and being left with about £10k of company debt,

I've been offered loads ioff times a cash injection so I can chase bigger jobs, I don't want anyone else having a say in my co, I've seen the mess it can end up with a clash of ideas, 

The theory behind it is good, but you know the old saying

Never work with family or friends




 

Thanks for your reply Steptoe. From what you describe that guy was a selfish piece of whatever and if anyone I knew acted like that for even a week I'd smack the selfishness right out of him before he thinks he can get away with it. I've heard never work with children or animals, but not 'never work with family or friends'. Most businesses begin as family-run firms or friendly partnerships. If you rule out working with family and friends who is left? Strangers and enemies? I'm not sure I'd want to go into business with either of them. 

 

[steptoe]

The thing is @johnnythunders

He wasn't really selfish at all, he was a decent nice bloke, he just couldn't get his head round being self-employed wasn't like being employed but with perks, it's actually a lot harder than being employed , especially at the beginning,

Weeks of no money coming in, jobs over running, late nights, no such thing as overtime.

I like to think I'm good at my job, but, I'm a shyte businessman, that's why I tend to do quite a bit of subby work, 

There is a lot LOT more to running your own business than simply on the tools, and you don't earn money pricing up or chasing payment, or procuring materials, you have to build all this into your job expenses, and you have to completely separate your private life from work.

Not all friends and partnerships can do that, somewhere down the line someone will take umbridge at the fact they are out in the pouring rain digging a trench while someone else is in a nice warm office pricing jobs, and for the same money.

Say your wife does the books, is she working for free, maybe joes wife should get paid the same for ordering materials,?

You really need to have stuff like this all sorted before it starts. 

 

[Doc Hudson]

See point 6 in the following article re' what Steptoe relates about the potential conflicts working with friends.  https://www.entrepreneur.com/article/196912   Further guidance, http://businessnegotiationservices.com/the-5-pitfalls-of-partnerships/   or again see point #6  https://www.quicksprout.com/2013/07/04/why-most-business-partnerships-dont-work/    or   http://www.furnarischer.com/partner_mistakes.html

Whatever the type of business, the administration roles and responsibilities of running a company are fundamentally the same. As are the risks and problems going into a business venture with others. Statistically the majority of small business fail with the first 5 years. So you go in thinking you are immune to all of these common business problems then you are more likely to be in the fail before 5 years statistics, than the still going strong after 5 years.  The basic point is around keeping formal written agreements about how the nuts and bolts of the business work.  Even as a sole trader guidance suggests care when doing work for close friends or family. Everything can end up as verbal agreements on 'mates rates',  that can become a drain on the business, resulting in hard work for little or no return.  No business will succeed if it is running many jobs at break-even or at a loss.  With 3 of you, there could be 3x mates 3x families all wanting cheap "discount jobs done".

Doc H.

 

[Doc Hudson]

(we're all a little backwards and english isnt our strength).

How will you be at writing up any quotes, contracts, payment terms, letters chasing late payments, or is it just around producing websites you feel weak. Any significant work involving large quantities of materials will need some form of written agreement to ensure any alterations during the work are accounted for, suitable interim part payments are built in, contingency for delays due to other trades and circumstances beyond your control are agreed. Otherwise it will be cash flow that kills you not the lack of orders on the books. 

Doc H.