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By miguel-ingles
- In Uncategorized
It may seem that forming a company in the UK would require large sums of capitals, especially during its early stages. However, if the directors apply the right strategies, it is possible to set up a corporation with minimal funds. In this article, I explain how to start a business in UK from scratch with no money.
Why Starting a Business in UK from Scratch with no Money
The UK is a hub for companies of all types from Europe and the rest of the world. Mainly, this is because the country has signed numerous trade agreements with markets from all around the world, while offering many facilities to both domestic and foreign entrepreneurs.
For enterprises starting from scratch and without investment, it is also appropriate to operate in the UK. On the one hand, the costs of registering at the Companies House do not exceed 50 GBP (60 EUR) and the constitution process may last less than 24 hours. On the other, the taxes in force in the British country are lower than in neighbouring nations, and the way to declare them is also simpler and more agile.
Steps to Start a Business in UK from Scratch with no Money
1. Defining the Business Idea and Model
Firstly, it will be useful to conduct a study of the British market. In this way, you can analyse your competition and potential consumers and discover uncovered market niches.
Then, according to the results of the study, you can choose your business idea. It is important to provide innovative solutions to problems that nobody has resolved. You should also consider the objectives of the company, the possibilities for future expansion, how the corporation will advertise its products or the attraction of funding, among other issues.
Additionally, you have to select a legal structure. The best option (and the most popular in the UK) is private limited company. This is because no minimum social capital is required and can be formed with a single person. Moreover, unlike creating a business as a sole trader, the liability is limited and allows hiring employees. Therefore it makes it a more suitable type of structure for small companies that intend to expand themselves in the future.
2. Finding Funding
There are many options with which a company can raise additional capital in the British country. In the private funding part, we have angel investors and venture capital funds. In both cases, in exchange for the money they contribute, they receive shares of the company.
On the other hand, the national government also offers subsidies, such as the Seed Enterprise Investment Scheme (SEIS) or the Enterprise Investment Scheme (EIS).
Although, perhaps, the best alternative for businesses in the UK starting from scratch and without investment is crowdfunding. This way of obtaining funds consist of raising capital without having to resort to large financial intermediaries, such as banks. Instead, they are replaced by anonymous individual donors (also called backers in this field). In exchange, they will receive a number of advantages for contributing monetarily to the financing of a project.
3. Using Free and Online Resources
To launch a business without investment, it is key to take advantage of free resources. Some examples are web page builders, graphic design programs, or accounting applications.
On the other hand, you can use social networks such as Instagram, Facebook or YouTube to promote the products and services of the company for free. In addition, they can also serve to conduct customer satisfaction surveys. In this way, you will obtain feedback that you can use to improve the quality of the articles or to find new business opportunities.
Finally, if the business is going to be selling assets online, it will be a good idea to use digital portals such as Etsy, Amazon or eBay. They concentrate much of the British traffic in terms of digital commerce. Additionally, the fees that the applications will demand to sell inside them will be small. On this website, you can check how to use these platforms.
In ukstartcompany, you will find information about how to establish, register and operate companies with different legal structures and business activities in the UK.