Me and a friend are thinking of starting up our own business, internet based/mail order. What process do we need to go through to register as a business/VAT registered etc? Were off for advice from job centre next week as ive been told they offer this kinda advice but would be good to hear from someone who has done it recently.

Thanks Craig.

I have no idea how to do it in the UK, but the principles are the same. Make a business plan and stick to it. It will show how you actually plan to make money. In other words, how your ideas will appeal to other people, so they will actually give you their money, not just be a cool idea that people find interesting.

To sum up: imagine you have to go to the bank to borrow. They will soon set you straight if your business plan is not up to scratch. They don't loan money to dreamers without concrete plans.

Would the citizen's advice bureau be any good for advice?

Get in touch with your local tax office , you have to register within 3 months anyway. Our local radio have been advertising about their services during the week

get all the plans and who puts in how much money etc down in writing and get legal advice in case it goes pear shaped,my first partner tried to run off with all the money and managed to freeze the bank account so dual sig,s on cheques are a good idea.
DONT BANK WITH BARCLAYS!

Go to www.businesslink.gov.uk/

Lots of good stuff there. Found it helpful when we set up a sideline. I think they will send you a book which is useful.

Get a book as well - learn the difference between partnerships, LTDs etc. We went with partnership, and we are under the VAT threshold so it was really straightforward to get started.

go see a good accountant speak to him about what you want to do and ask him about becoming a ltd company and all the tax benefits available he will be the best person to get the ball rolling and will even be nable to help with a buisness plan as well and good luck what you thinking of selling

I run my own business. I am sole Director and wouldn't want a partner.

I have heard of so many people who have stared businesses with partners where it hasn't worked out that I would say don't do it.

If the idea is a good one, you can run it on your own and pay staff to do the work - a member of staff should cost you a lot less than a partner who would want 50% of everything.

If you absolutely have to have a partner, then make it a close member of the family - someone you can really trust - and get the partnership fully legally documented and teid up so that no 1 person can run off with all the money.

I agree with Bob Tatt above who says go see an accountant who is used to advising startup businesses.

Good luck

Cheers

mark

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Originally posted by Robertf
Go to www.businesslink.gov.uk/

Lots of good stuff there. Found it helpful when we set up a sideline. I think they will send you a book which is useful.

Get a book as well - learn the difference between partnerships, LTDs etc. We went with partnership, and we are under the VAT threshold so it was really straightforward to get started.

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Get a friendly accountant, if possible through recommendation, and go and see him. He will be able to explain the benefits of all the various options available. You obviously need a Limited company, but as you have a partner you will need share certificates sorting out to make sure the partnership is fixed, and you will probably want to register for VAT. Although you don't have to do it until £60k-ish, there are various tax advantages and a couple of other reasons why we went for it from day 1, and I would recommend you do to.

An accountant would be able to fill in all the paperwork and sort out the whole thing for you. From memory, we paid about £150 for our guy to sort it all out for us - money well spent at a time when you have plenty of other things to think about.

If you are doing Internet trading you want as much automation in your website as possible. I would recommend getting a Barclays Merchant Account with a product called 'ePDQ Lite', which is essentially an XML interface into which you can push credit/debit card numbers. It's very easy to integrate with when the time comes to put it all on the web.

We also have our business account with Barclays, and I'm not really happy with the situation. At the present I'm not fed up with them enough to go through all the hassle of moving, but if it wasn't so much effort to do, I would move. I've heard good things about HSBC's business banking recently, but I've not looked into it.

It's worth noting though that you can have a Barlcays merchant account associated with any bank's regular business account.

That's enough to baffle you for now. Feel free to drop me an email if you need any advice!

Cheers, Chris

I am a sole director of my own company which is limited. I am also VAT registered.

I have an accountant which sorted things out for me at the beginning and I just bought a pre-register limited company which was transferred into my name.

You can download all the necesasry documentation off the HM revenue and customs site for VAT registration. I cannot remember the limit where you have to apply but you can do it voluntarily.

If you turn over less than a certain amount you go go flat rate VAT registered which for me means that i charge my clients 17.5% and pay the taxman 12.5%. This difference is to offset my sales against my purchases and makes the VAT returns easier.

If you are going to have a partner you need to discuss it with somebody that knows about it as there are certain liabilities if the company go bust. I don't know all the legal details but in one instance if your partner was to do a runner you would be liable for all of the companies debt.

My business account is with HSBC and I have never had a problem with them, very helpful. The reason I went for HSBC is that my personal account is also with them which means that any transfers between accounts is instant rather than having to wait a couple of days for the money to clear.

Bascially find a good accountant and they will help you sort everything out.

[Edited on 1/3/08 by neilj37]

[Edited on 1/3/08 by neilj37]

Cheers guys, this has been very helpful, going to get an appointment made with a local Accountant and also go to job centre and citizens advice.

The business will be Selling after market car parts, Exhausts, wheels brakes etc, I have all ready approched quite alot of manufactures like Magnex, Momo, K&N etc and we are hopeing to become authorised sellers for them.

Im currently working on a business plan and we are also doing alot of market research into the products we plan to sell to see which sells better etc.

Later today im hoping to speak to my cousin who has recently started his own airport Taxi service to get some advice aswell.

In about two weeks we should have the business plan complete and we should have quite alot of manufactures waiting to take orders from us (fingers crossed)

Also does anyone know the best way to start up a website to sell products? needs to have payment facilities and be easy for customes to navigate round and also be easy for us to maintain?

Hi, I don't want to put a downer on your obvious enthusiasm but unless you have a fresh angle on that market it is very competitive indeed. As you'll probably know from reading this site reputation can be everything when customers are looking for products. Good luck with the venture.

I my area, and probably across the country, Business Link run one week businress start up courses. I went on one and found it very informative and enjoyable. Also, it was free.

HTH
Mal

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Originally posted by SeaBass
Hi, I don't want to put a downer on your obvious enthusiasm but unless you have a fresh angle on that market it is very competitive indeed. As you'll probably know from reading this site reputation can be everything when customers are looking for products. Good luck with the venture.

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Join the Federation of Small Business - £100 a year and you get MASSIVE support, legal advice etc, you also get free Co-Op banking for ever, and by far the best credit card processing fees, along with cheap insurance etc etc, really good impartial advicepeople.

As others have said avoid partnerships if at all possible.

Try and get a book keeper rather than an accountant - much cheaper and will still save you £££££.

If you want a recommendation for web site designers for a fully functional automated web site then I could suggest the guys we use, been with them for 8+ years and are always very happy with their service and work: www.mbcommerce.co.uk


Business Link are very useful too.

Don't use Barclays!!!!

If you go for a Ltd Co. and need to take out a loan DON'T secure it against your house if you do don't bother being a Ltd Co.

One more important piece of advice: think very very hard about how you will be different than all the other suppliers out there. As you will not have a lot of volume to begin with, it will be difficult to stay competitive with everyone else. No volume = higher prices for the goods you have to buy. Reputation is built on service, yes, but with the internet, pricing is key.

I run my own internet retail company (netbriller we sell designer glasses with prescription lenses) and found "Beer Mat Entrepreneur" a good read when I started up. EKMPowershop is a good basic interenet shop - you can set it up online and don't need any coding expertise.

We use PayPal for card handling, but wouldn't go that route again - would consider Google Checkout instead.

One of the biggest headaches is getting eye balls to the your web site - so you need to come up to speed with the black art of search engine optimization. No eye balls = no sales - this is a good read Conversion Rate Squirrel

Finally most sites only convert 1% of visitors to buyers. Depressing but true! So work hard on maximising that conversion ratio. Check out this company for ideas in that area Future Now

Last of all - go for it and enjoy the trip :-)

for your type of business i would try and get up and running in a part time way and keep an income stream while the business builds ,as your going into a business that is price driven unless your buying seroius volumes your mark up may be as low as 5%. whatever your business plan forecasts half it and see if it provides an income for two. a mate does custom bike stuff mail order and with around 300k turnover it supports him and a small rented unit for stock

As stated before;
DO NOT BANK WITH BARCLAYS.
I was offered an overdraft whilst waiting for payment of a client. I then found out that they were charging me 3 times the goung rate. It cost me £800/quarter interest on £5K! Robbing love children.
DO NOT employ friends or family, they take liberties.
A partner is just a war waiting to happen.

GOOD LUCK though mate. I admire anyone willing to have a go.

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Originally posted by froggy
for your type of business i would try and get up and running in a part time way and keep an income stream while the business builds ,as your going into a business that is price driven unless your buying seroius volumes your mark up may be as low as 5%. whatever your business plan forecasts half it and see if it provides an income for two. a mate does custom bike stuff mail order and with around 300k turnover it supports him and a small rented unit for stock

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i can see why some people dont like partnerships mainly because men let issues build up rather than sort them out.ive lost count of the stand up rows we,ve had over the years but we have a way of sharing the load that works for us .

im just filling in vat forms now, what a headache... Still, i work out it will save me £150 a week!

good luck anyway

just to add, i started in a partnership, always got the impression that i worked harder and learned faster, soon got out of that. Went from mediocre 'just pay the bills' to 'that'll do nicely, thanks'

[Edited on 1/3/08 by JoelP]

I'm just winding up my business as I'm going to work for Icode systems but here's my advice:

Never go into business with a friend.
Use Abbey National for free business banking for life!
Get a good accountant.
You should be able to set up a company for £200. You can buy mine for that if you want. Its Tibit LTD. It will be just the company name and domain (www.tibit.co.uk) but I'm VAT registered and debt free and all set up if you want to make it easy.

It also costs about £30 to change the company name and is easy to do through companies house.

Jon.

[Edited on 1/3/08 by joneh]

[Edited on 1/3/08 by joneh]