new business but not sure how to start!

drywash

hi all,

been working as a web designer but have started to develop some issues with my employer. basically he pays me a minimum wage to build a whole site myself, the same guy is computer illiterate, and now I have been having problems getting wages owed to me off him. I've become pretty sick of it and have decided that i can do the exact thing myself from home and keep 100% of the money from the sites i make (we have been charging upwards of €1000 for sites and ive been getting about €300 of this!)

Now for the moment I'm not quite ready to leave him, until I'm set up and running myself. I have all the equipment and software required myself and will be running this myself, and as i have a background in IT, i plan on doing pc repairs and upgrades as part of this. But my question is, where do i start?
Do i need to register for VAT and register a business name?
I have my prices made out, and as i see it, from websites the most i stand to make in a 12 month period is circa €10,000. Repairs would be considerably less. I would estimate about 13-15,000 in the first 12 months.
I work another part time job which would keep me ticking over for money while i was starting off.

Any advice anyone can give me would be greatly appreciated and if i havent been clear on anything ive said just let me know and i can go into more detail.

thanks

Dakor

Ok, first things first, are you a web designer or a web developer? There is a huge difference. If you are a designer and you don't know any programming language then you will need to hire a programmer to do the custom work for each project. If you are a programmer then you will need to hire a designer to work on that part of it. I have been in this business for over 12 years and I have never come across a good designer that can also programme and vice-versa. And of course, if you are a designer then you need to know CSS inside-out. All sites nowadays are built CSS only, no more table, T.G.
Just food for thought there.

Right, now for the business aspect of it. What will your unique selling point be? how will you get your clients? Everybody and their dog thinks they can design and build a website, so you will have a lot of competition out there. Once you decide on that then work out a marketing plan. I'm not trying to scare you here, but you need to think about these things before going into business.

Ok, now that you have given thought to that and you are still going ahead, then it is actually quite easy to set up a web design business. First, of course, buy your domain name and build your website. Then register your business name with CORE If you are going to be making more than €37,500/Year then you need to register for VAT. Once you have that done then you are ready for business.

Good Luck

drywash

thats for your speedy reply. I'm a developer but I do my own designing. I'll completely agree with you as regards my designing skills, but so far i've been doing it all myself! thanks for the rest of your advice though everything is very much appreciated and I'm taking everything in!

Andy_Black

Hi drywash,

Something to consider is the time it takes from looking for a client to an invoice being paid.

Lets say it takes you 5 days to land a contract to build a €1000 website. You knock up the site in 2 days, have revisions over 1 day, and spend 1 day sending out an invoice, chasing payment and lodging the cheque when it comes a month later.

So we're looking at 9 days work to get that €1000, making your daily rate a little over €100 per day.

If you're the guy who gets paid €300 to do the 3 days of website build and revisions then your daily rate is €100 a day.

You have to factor the non-chargeable time into your equation, and this can help you determine whether the guy you're working for can pay you more than €300 for a website he sells for €1000.



I was investigating this myself a while ago before I was forced to take the plunge and I came across an eBook that seemed excellent from the free chapter I downloaded.

You can see it here: http://www.sitepoint.com/kits/freelance2

I didn't actually purchase it, but may do later. I found that once I'd been emailed the free chapter then SitePoint mailed me a couple of more times asking me if I was interested in purchasing and each time they dropped the price. In the end I think the final price was $147 which I think is a bargain for the wealth of knowledge in there.


I hope that helps.

Andy


Grow Your Business With Digital Insight
www.digitalinsight.ie


Quick update: I've just checked out that eBook again, and for the $147 you get "The Principles of Successful Freelancing" too. In fact, they are sent as hardcopy A4 folders with CDs containing sample letters, forms, checklists, and templates. For €100 I've just gone and ordered it... It should be here in 10-14 days.

scottyboy1973

Hey there
Worth looking at Starting a business in Ireland (available in all good bookshops) and also contacting your local county enterprise board. They offer start your own business courses, other skills based courses and networking events that are all pretty heavily subsidised.

As a sole trader you dont have a register a business name (unless you want to). Re VAT, the threshold is €70k ish so I wouldnt worry about that just yet - it's a bit of a balls ache to have to look after. Just keep a track of income and expenditure for your end of year perrsonal tax return.

Per Andy's note it's definitely worth doing the numbers to have a good idea as to what you have to earn/want to earn/need to earn to survive.

if you can get your current employer to make you redundant, the Welfare runs a scheme called he Back to Work Enterprise Scheme where basically they will give you your full jobseekers entitlement whilst allowing you to earn whatever you can from a new startup enterprise. have a look at welfare.ie for more

Hope that helps

drywash

thanks again guys this has all been very useful help. I would imagine that I won't be looking at registering for VAT for quite a while if the threshold is that high, one can dream though

Andy let me know about that book when you get it, it sounds quite interesting and worth its price, I'm going to take a look at the website soon. Next job is to contact the enterprise board as I have still got a few things I'm not sure about but don't want to be bothering you guys any more with it.

Appreciate all the advice, i'll be back to post an update whenever i have one!

Dakor

Just to let you know that the actual threshold for VAT for your business is €37,500, €75,000 is for people that are selling goods. You will be selling services.

See the Who must register for VAT? on here http://www.revenue.ie/en/tax/vat/full-intro.html

scottyboy1973

Dakor wrote: »

Just to let you know that the actual threshold for VAT for your business is €37,500, €75,000 is for people that are selling goods. You will be selling services.

See the Who must register for VAT? on here http://www.revenue.ie/en/tax/vat/full-intro.html

I stand corrected - numbers never were my strong suit!:D

MOH

scottyboy1973 wrote: »

Hey there
Worth looking at Starting a business in Ireland (available in all good bookshops) and also contacting your local county enterprise board. They offer start your own business courses, other skills based courses and networking events that are all pretty heavily subsidised.

As a sole trader you dont have a register a business name (unless you want to). Re VAT, the threshold is €70k ish so I wouldnt worry about that just yet - it's a bit of a balls ache to have to look after. Just keep a track of income and expenditure for your end of year perrsonal tax return.

Per Andy's note it's definitely worth doing the numbers to have a good idea as to what you have to earn/want to earn/need to earn to survive.

if you can get your current employer to make you redundant, the Welfare runs a scheme called he Back to Work Enterprise Scheme where basically they will give you your full jobseekers entitlement whilst allowing you to earn whatever you can from a new startup enterprise. have a look at welfare.ie for more

Hope that helps

You do have to register a business name if you're carrying out the business in anything but your own name, even as a sole trader.

Dakor

Also, registering a business name will make it a lot easier to purchase a .ie domain name. Once you get your business name certificate, fax it to the company where you purchased the domain name.

drywash

hey again guys, just as a follow on to the business name, would you guys recommend opening a separate bank account for use under the business, or at the start would i be alright just using my own bank account. If im paid by cheque under the business name, can i just lodge that into my own account? sorry I know I'm asking some very silly questions but I'm trying to get to know as much info as possible!

thanks again

kenbrady

drywash wrote: »

hey again guys, just as a follow on to the business name, would you guys recommend opening a separate bank account for use under the business, or at the start would i be alright just using my own bank account. If im paid by cheque under the business name, can i just lodge that into my own account? sorry I know I'm asking some very silly questions but I'm trying to get to know as much info as possible!

thanks again

Cheques made out to the business name will need to be lodged into a business account with that name.

tombull82

+1

Dakor

drywash wrote: »

hey again guys, just as a follow on to the business name, would you guys recommend opening a separate bank account for use under the business, or at the start would i be alright just using my own bank account. If im paid by cheque under the business name, can i just lodge that into my own account? sorry I know I'm asking some very silly questions but I'm trying to get to know as much info as possible!

thanks again

Yes, get a separate bank account for the business. It makes it a lot easier to track your income and sales.

scottyboy1973

And it gets rid of a whole world of pain should Mr Revenue decide he wants to audit you

SB

drywash

ok perfect thanks.

I'm just putting together a list of what I need to get myself started, so far have,
Business Name,
Domain Name,
Bank Account,
Business Cards,

I have all the software and hardware I need, will also have to open a reseller account for hosting as I plan on providing hosting to my customers, I'm looking into advertising as well.
Can anyone see something that I'm missing here?

Thanks again

Tomthepost

drywash wrote: »

ok perfect thanks.

I'm just putting together a list of what I need to get myself started, so far have,
Business Name,
Domain Name,
Bank Account,
Business Cards,

I have all the software and hardware I need, will also have to open a reseller account for hosting as I plan on providing hosting to my customers, I'm looking into advertising as well.
Can anyone see something that I'm missing here?

Thanks again

1, 2 and 3 are important however business cards aint going to make your business.
Good flyers that clearly identify what you do and why people should consider using your services would be a much greater investment then business cards.
Stay away from paid advertising for now. Instead uses the networking sites like Twitter and try to get to free networking events.
Put together a proper business plan and identify what strategics you are going to take to win customers.
You will have to pick up the phone and make appointments, show companies work you have done etc in a sharp presentation.
Advertising and business cards wont do this for you.

If funding is required you will need a good business plan so I would really prioritise that at present.

Im a few weeks ahead of you in the process so I know what its like
Good Luck