Setting Up Your Own Business?

David Gordon of DG Law talks about his experiences and offers advice on working for yourself...

After discovering that life as a "city lawyer" was not for him, David Gordon decided to take fate into his own hands and set up his own practice, DG-Law. Four years on and David confirms the brave move was one of the best decisions of his life:

"I had for a long time wanted to be in business on my own account, and have a degree of control over my own destiny. Additionally, I felt that working for myself would enable me to use my skill set to its full potential.  The legal sector can be very specialized and in larger firms a Solicitor is expected to be an expert in a relatively narrow field, and general business skills are not as highly valued or rewarded.  A variety of experiences provided me with the insight that being self employed and starting and creating something from scratch would be very fulfilling and was exactly what I wanted to do. In setting up my business, I decided to remain in the legal sector as this was the field of my core training, experience and also my passion – so should (in theory at least) provide me with the best chance of success.

"Now that I am self employed I am much happier and much more secure, especially when it comes to having too much work on as this means more income! I have the flexibility of working from home and don't have to commute into the city.

"Even though I work as hard and as long as I did when I was in the city, the work is tremendously more satisfying and as it is self generated, it's not as stressful either. As my own boss, when a decision needs to be made, it is made there and then; there is no partner meetings to wait the results of and no board to present to.

"Of course, while there is freedom, there is of course freedom to work to excess and the challenge is to remember to switch off and take a break.

"Working for myself is very challenging but also very exciting and I would definitely recommend it to those who have an inkling that being your own boss is something they want to do. You have to have the constitution which can ride the highs and lows, and be able to pick yourself up when times are tough or when you have seemingly received a mortal blow. If you can overcome that then your chances of success are infinitely greater."

David offers his advice on setting up a business: 

Getting Started:

Getting a new business started can be frustrating, complicated, time consuming and also expensive. The key rule is to be really tough with yourself when identifying what are the absolute basic requirements to run your business and what are the luxuries that would be nice to have. For example, is a top of the range, multi-feed Xerox colour copier critical or do you just want it because that was the one you were used to in your old firm?  Is there a more moderate and cost effective option?  Do your clients need you to be in swanky office accommodation in the city centre complete with receptionist, chill out rooms and live sky feed in the waiting room, or can you get away with making do with a cheaper option (eg home) until you build up your client base or even actually win your first client? Boardrooms can be rented by the hour or day if you really need to present a coherent corporate image for a short time, alternatively you may have contacts who will happily lend you the use of their empty boardroom for free.

If you are working from home and you live in a flat, don’t use the address “Flat 1 Tower Block East”, instead use the phrase “Suite 1” as it is more generic and gives the impression of being more professional. Be cautious if you are working from home as this has capital gains and business rates implications in the longer term.  Some leases also prohibit you from operating a business from the premises. 

Put your banking out to tender, don’t just stick with your long standing family bank who have happily given overdrafts since your student days. Shop around and ask what they can do for you, what corporate deals they have and how they are better than the competition. Some banks offer up to two years free banking for new companies.  It may be that your own bank offers the benefits of continuity and speed; they already have money laundering checks done and a full credit history on file.  Choosing the right banking partner is important, as you generally remain with your first bank for an average of 3 – 5 years. Critically, look at organisations with good on-line banking facilities, as the ease of setting up CHAPS and BACS payments and so forth can make life a lot easier.  Watch out for the hidden extras eg. charges for cheques, direct debits etc.

Business planning can take endless quantities of time. Sometimes you can over-plan your product or project and waste valuable time just speculating about how you will do things.  Don’t forget just to get out there and start selling and try to get at least one client as proof of concept.  If no one is prepared to pay anything for your service or product then no amount of strategising is going to solve this. 

The best bit of business advice I was given was from a banker. He said that 90% of people walk through the door at the outset with a plan of where they think their business is going to come from.  One year later he said at least 90% of these individuals had found that in reality their clients and income came from entirely different sources.  This philosophy can impact on all sorts of areas of your business. For example, if your business is called Balham Silver Forks Direct limited and it turns out that your key market and revenue lies in delivering spoons in Liverpool, then until you get around to changing your business name and model you are going to have an uphill struggle explaining why you named your company what you did.  The message is really to be very flexible in the first few months and years of trading; be prepared to radically re-examine what you are doing very regularly.  After all, to adapt is to survive.

Networking

There are no end of networks that can be accessed in the Uk’s leading cities.  BNI, BRE, NRG, Ecademy, Chambers of Commerce, the Federation of Small Business, Institute of Directors, Business Link and many more. Again, be critical as to what you spend your marketing budget on initially.  Some products and services sell best by referrals, others can be promoted effectively through public relations, direct mail or advertising. It is very easy to over commit to attending events and then spend too much time talking to people who will be of very little use in developing your business.  I would recommend joining at least one group which meets regularly. The benefit of this is that during the tough times when business is quiet or you have issues that are difficult to resolve, you have the discipline of turning up to an event and putting on your “best selling” self. As well as motivating you, this also provides an opportunity to source some friendly and supportive advice. Generall, members of the above organizations have either been where you are or are in the same situation, so are in a good position to offer empathy and support.

Insurance

Directors Indemnity (if you are trading as a Ltd company). 
Professional Indemnity (if you are an accountant, lawyer, dentist surveyor etc) 
Employer’s liability (if you have employees). 

Insurance companies increasingly take a dim view if it turns out that you have been operating without the adequate levels of insurance.

Generally, in starting your own business you should expect to work harder and for longer than you have ever worked before. That said, if it is your passion and you are enjoying the process it will also be the most rewarding thing you have ever done as you watch your business grow against all the odds and scepticism that others may put in your way.

For futher information on DG Law please visit: www.dg-law.co.uk