All directory small business guide: Part two
The second part of our short guide is produced to help small businesses in the UK starting out get a good grounding in sound principles which will stand them in good stead when it comes to developing their company.
How Networking Can Improve Your Customer Base
Networking is a hugely undervalued asset in today's businesses. Not only is it very cost effective in building customer relations, but it also allows the customer to see your company, not only as a supplier of goods or services, but also as real people that they can relate to. This in itself can greatly improve customer loyalty and lower they risk of competitors gaining advantage in your markets.
Networking is itself a very broad term for gaining more contact and interaction with like minded people or customers, that could be beneficial to your business. This can include events of a more formal nature such as learning networks that are hosted by major industry players such as the CBI (The Confederation of British Industry). Or much less formal events, such as a small soirée, that you invite customers and potential customers to (not many will turn down a free party), in the hope of building better relations with them
It is important to get a good balance between the work and the social aspect of the gathering. For instance giving a sales presentation is not the purpose of the event and your guests may well be unhappy if they are invited for drinks and then presented with a sales pitch.
The purpose is to build a kind of business based friendship with the people that you are networking with. It is much more difficult to break, even in the face of a better offer, a relationship with someone you know and like than, with someone that you just get the occasional invoice from.
Some of the most effective networking can be carried out when seeing the client on a one to one basis, as this gives the relationship a more personal aspect. And a discussion over lunch and a few drinks can be very effective in the long run in knowing your customer and helping them to get to know you.
Networking is a wonderful way of building trust and loyalty in to the client, customer relationship and it is well worth taking little extra time to bring in long term rewards.
Company Formation - Sole Traders versus Limited Companies
Whether you have been trading for a while, or whether you are just setting up your own business, you may be deciding whether to carry on as a sole trader, or start up your own limited company. Although having your own limited company sounds much better (especially if you are the chairman), you really need to look at it from the point of view of what will be best for your business.
Many think that their potential customers will take them more seriously if they are a company. This may be correct in part, but the only way to get repeat business is if you do a good job and some who are more price driven will be more inclined to look for sole traders, as they may well believe (whether it is correct or not0 that they will get a better deal from them.
Some start a limited company as they think that it will make things simpler, but there can be a lot more paperwork in running a company than with just working for yourself. It does have the benefit, of course, of limited liability for debts. Many prefer this, as they see the market as volatile and do not want to be left with debts if their business does not trade successfully.
It is still possible to operate under a trading name even if you are a sole trader. The real difference is that although you can have a trading name, it must be obvious to your customers who the owner of the business is. This means that although you can trade under a business name, on most paperwork it must be shown as “ your name” trading as “your business name”.
There can be tax advantages to incorporating, as the tax levels for corporation tax may be lower. But whether this is an advantage can also depend on what wage you take out of the company and whether that takes you into the higher tax level, or whether you want to reinvest the money. There are also some variations in the pension allowance and you are more likely to be able to gain advantages from higher contributions, if you are a limited company rather than a sole trader.
It takes a great deal of consideration as to whether you are better off as a sole trader, or a limited company and it is a good idea to get professional to give you advice, as to the advantages and disadvantages that are particular to your situation. There are many variables and what is best for one business, may not be best for a different business.
About the Author
Another important step is to promote your business on the internet and our UK business directory will list your site for a one off fee of £12.99. With over a million businesses listed, why not give it a try?
Tell others about
this page:
Comments? Questions? Email Here