How to Start a Keepsake Business from Scratch?

How to Start a Keepsake Business from Scratch?

Author : Michelle Williams

If you are just embarking upon your Baby Hand Casting Training or Fingerprint Jewellery Training and are in the early stages of starting a Keepsake Business from scratch, there are many things that you will need to consider to ensure that your Keepsake Business is built on firm foundations and poised for long term prosperity.

When first starting a Keepsake Business, it is easy to get caught up in the initial excitment of learning the different Life Casting Techniques and Keepsake Jewellery Techniques, without giving much thought to the actual steps you will need to take to start a small Keepsake Business, let alone the legal things you need to know before starting a Business. 

There are many things to consider when starting a new Business.  To help you, I have produced a list of things needed to start a business and my top tips on how to start a business from scratch.  This is relevant for any Business, whether that be a Baby Casting Business, Keepake Business, or any other type of small business.

  • Enroll onto the Appropriate Traning - Far to many people decide upon the idea of starting a Baby Life Casting Business or Keepake Jewellery Business without embarking upon the appropriate Baby Casting Training Courses or Keepsake Jewellery Courses.  If this is your strategy you are likely to experience many issues and roadblocks along the way.  You require professional training to start a successful Keepsake Business This article explains why.
  • Find a good Accountant - Don't not be afraid to interview them and question them to assess their experience and suitability. Do they work for a similar sized business?  What makes them better from another Accountant>  How long does it take them to produce Annual Accounts?  How do they want you to record your sales and expenditure? Will they charge your monthly or annually?  You can find a local accountant at www.local-accoutants-uk.co.uk  
  • Determine if you need to be VAT registered? Your accountant will be able to  advise you. However, if you are operating a business from home, as a sole-trader, it is probably unlikely that you will reach the VAT threshold in the early days, but refer to your Business Plan and always take the advice of an accountant.
  • Decide upon your Business Structure & Legal Status - Will you be a Sole Trader? Form a Partnership agreement? Or register a Limited Company? There are advantages and disadvantages of each, as I explain in my recent article; How to choose a Legal Status for your Keepsake Business. 
  • Prepare a Business Plan & Financial Budget - You will need to workout fixed costs and variable costs over 12 months. Fixed costs are rent, heating, insurances, salaries, loans etc. Variable costs are products, supplies, services, and marketing. If you have not yet prepared a Business Plan and need help in knowing how to write a Business Plan for your Keepsake Business, please check out my Masterclass on Business Planning
  • Know your Break Even Figures - your Break Even Figure is the point at which your sales and revenues cover your expenses.  Your break even point should be your minimum target to reach.
  • Keep Control of your Cash Flow - Cash Flow is the net change in your Business's cash position frome one period to the next.  If you bring in more cash than you send out, you have a positive cashflow.  If you have more cash outlow than inflow, you have negative cash flow. Cash flow is important, because it is a key indicator of your business's financial health.  Rembember the saying: "Revenue is vanity, margin is sanity BUT Cash is King!"
  • Choose a Good Bank - make comparisons, check out services and packages on offer, choose a recognised name, and find out if you are allocated an Account Manager.
  • Check if you are eligible for a Business Grant - You may be able to get some help in the form of a grant. For example you might be eligible for an Enterprise Allowance Grant to help you with moving from Benefits to starting your own Business.  You may be eligilge if you are over 18 and either; you or your partner get Universal Credit, Jobseeker's Allowance or Employment and Support Allowance, or you get Income Support and your are a lone Parent, Sick or Disabled.  Alternatively, if you are aged between 18 and 30, you may be eligible for a grant from the Princes Trust. In addition, The Queen Elizabeth Scholarship  is awarded to people who want to improve their craft skills and can be used to fund further study, training and practical experience.
  • Further information on Grants - is available from the Governments Business Finance Support Online Tool.  (Selecting the 'grants' tick box to find Grants that you me be eligible for. The Local Enterprise Partnerships (LEP) Network has been set up to provide business funding, suppport and guidance in their local areas.  They have 38 regional growth hubs in England who may be able to help you to find local Grants that you may be eligible for.  If you are located in Scotland, you can apply for a Business Grant from Scottish Enteprise.  If you are based in Northern Ireland, Enterprise Ireland, lists several ways that you can get finacial help for your small business is already up and running. If your small business is located in Wales, you can search the Welsh Goverment's Funding Locator to find and apply for various grants in your area.  Grant aid varies considerably around the UK and some assistance may be available in your area to help you start your Keepsake Business. In particular, often there
    are grants available to women or lone mothers starting out in Business; therefore it is worth contacting the above Agencies to see what help may be available.
  • New Business Tax Relief - New Businesses can benefit from a variety of tax allowances and relief that may result in a lower tax bill. They include tax allowances for investment in equipment and premises, tax relief and credits for spending on research and development and stamp duty relief in disadvantaged areas. These tax advantages need to be applied for via  www.gov.uk/capital-allowances. This can be complicated for a new business start-up, so I recommend that you seek help and advice from an Accountant. 
  • Develop your Brand Strategy - A well planned and considered Branding Strategy is vital to the sucess of your business, so don't fall into the accidental branding trap.  Branding is about far more than designing a pretty logo. A strong brand identity will enable you to raise brand awareness and built trust, attract your ideal customers, differentiate yourself from the competition, prevent you having to compete on price and will help you to attract more customers who are willing to pay more. 
  • Create your Keepake Website - A well designed and developed e-commerce Keepake Website is vital to the success of your Keepsake Business because; It reflects the quality of your business and brand. If it's professional your customers will think that you are professional and vice versa. It brings in more sales and helps customers to find you when conducting localised searches.  It helps to bring in extra local business. It helps to generate wider national and global business. It can generate media interest.  If you need help with designing and developing your Keepsake Website, check out our 'Done for your Keepsake Branding & Website Start-up Package.'
  • Health and Safety - Health and safety law is enforced by inspectors from the Health and Safety Executive or by inspectors from your local authority. If you operate from a Businesses premesis,  Inspectors have the right to enter any workplace without giving notice, though notice may be given where the inspector thinks it is appropriate. On a normal inspection visit an inspector would expect to look at the workplace, the work activities, your management of health and safety, and to check that you are complying with health and safety law. The inspector may offer guidance or advice to help you. He/she may also talk to employees and their representatives, take photographs and samples, serve improvement notices and take action if there is a risk to health and safety that needs to be dealt with immediately. Visit www.hse.gov.uk for downloadable documents and resources. 
  • Employee Rights - ACAS is an extremely helpful organisation to help with employee rights. ACAS aims to improve organisations and working life through better employment relations. They provide up-to-date information, independent advice,
    high quality training and work with employers and employees to solve problems and improve performance.
  • Payroll - If you plan to employ staff and require a payroll system, we recommend www.thepayrollsite.co.uk. The system produces pay slips, tax summaries and online annual returns, linked to the Inland Revenue website,  for as little as £6.50 per month. They offer step by step instructions and are really helpful with their advice.
  • Consumer Rights Act -  If you sell products or service to consumers from a base in the European Community, then you are obliged to comply with this act. For further information visit:  www.gov.uk 
  • Online and Distance Selling Regulations - If you intend to sell your products by phone, mail order, or online, you will need to comply with Online and Distance Sellng Regulations. 
  • Home or Business Insurance - most standard Home Insurance Policies are unlikely to include kilns in their cover due to restrictions imposed by underwriters. If you find a standard policy, it is likely that surcharges and/or exclusions will be imposed.
    Failure to advise your insurance company that you are operating a Kiln from your home or business could result in a cancelled or invalid insurance policy. This means that any damage caused by the Kiln will not be covered. It also means that the kiln itself will not be covered should it become damaged from other causes. In my experience, most insurance policies automatically exclude the ability to fire a  kiln overnight or when a building is closed or unoccupied. I recommend that you contact a Specialist Insurance Broker,  who understands The Craft and Keepsake Market and who should be able to help you find a suitable policy. I provide further details on insurance, including a list of insurance brokers on my article on Keepsake Business Insurance Requirements.
  • Public Liability Insurance - As well as adequate insurance for your business premises or home, you will also need to take out Public Liability Insurance, especially, since you will be working with members of the public and in particular, babies and young children.
  • Employers Liability - This is a legal requirement if you employee anyone, even on a casual basis. Please also remember to inform your Insurance Company of any work that you do away from your Business Premises. For example, Demonstrations, Exhibitions, Craft-Fairs and Home Appointments etc. This is because few insurers automatically provide this cover, so you must be clear on your requirements when you speak to them. Any Business that employs staff is at risk of possible legal action for damages by an employee who can prove to have suffered injury or illness while carrying out their workplace duties. It is a legal requirement for all companies with employees to hold Employer’s Liability (EL) Insurance.  
  • Data protection - If you store data about individuals; employees, customers, the public, then European Businesses are required to comply with the Data Protection Act and GDPR.
  • Financial Planning and Accounts - Financial Planning is important to help you determine and meet your short and long term goals.  This involves creating a budgeting process to keep yur busines andit's finances on track. Although there are several other elements that you will need to incorporate into your Financial Planning. 
  • Playing Music in Public  - Under UK copyright law licenses are required if music is to be played in public.  PPL PRS issue licenses to the owner of premises who wish to play music. 
  • PPL PRS Music License -  PPL PRS is a music industry organization collecting and distributing airplay and public performance royalties in the UK on behalf of over 3,500 record companies and 40,000 performers.
    Whether your business is a small independent retail outlet using a CD player, or a large department store using specialist in-store radio, you will need a PPL PRS Music License. 
  • Planning Applications – Make sure you have gained Planning Approval for any changes you wish to make in order to run your Business from home. If you are uncertain if you will need planning permission go to www.planningportal.co.uk or www.gov.uk/run-business-from-home
  •  Business Rates -  You do not usually have to pay business rates for small home-based businesses if you: use a small part of your home for your business, for example your bedroom as an office.  But you may have to pay business rates, as well as council tax, if your property is part business and part domestic, for example, if you live above your shop, you employ other people who work at your property, or you’ve made changes to your home to accommodate your business.  You can check if you are eligible to pay business rates at: www.gov.uk/introduction-to-business-rates
  • Small Business Rates Relief – Some business properties are eligible for discounts from the local council on their business rates. This is called Business Rate Relief. There are different types of Business Rate Relief, including; small business relief, rural rate relief, enterprize zone relief, retail discount. Go to: www.gov.uk/apply-for-business-rate-relief for more information and contact your local council to find out if you are eligible.
  • VAT - You do not need to register for VAT unless you have or expect to have a turnover in excess of the VAT threshold (£85,000 as of August 2020). However, you can choose to voluntarily register for VAT if you have a lower turnover below the VAT threshold.  If you do decide to register for VAT, it is worth noting, that you can apply for up to three years on any VAT expended on capital equipment.
  • Customer Service Disclaimers - Think about your processes for disatisfied customers. What will your Returns or Customer Satisfaction Policy be? Will you offer a free replacement, credit or refunds?
  • Working Captial - Working Capital represents the lifeblood of any healthy business. Many promising businesses, have over the years, found themselves insolvent, despite significant assets and healthy profitability. The problem here, is usually lack of operating capital, without which, no business can survive. Make sure that you have sufficient working capital, not only to cover your initial start up costs, but also to cover the additional costs, necessary to support the day-to-day operation of your business.
    This starts out with solid Business and Financial Planning and securing the services of a good Accountant to help you plan and stay on track.

I hope that this article has been helpful to you in understanding the legal things to know and steps to start a small business.  If you need advice and guidance on starting and developing your Keepsake Business, I'd love to help.  I have over 20 years experience running my own successful Keepsake Business and offer a market-leading series of Life Casting Courses and Keepsake Jewellery Courses, along with a growing collection of Business and Marketing e-courses, designed to help you with each stage of starting, launching and growing your Keepsake Business.

If you need any help with writing a Business Planning, developing your Brand Strategy or designing your Keepsake Website, I have a range of services to help you with that too!

If you are right at the begining of your journey of considering starting a Baby Hand Casting Business or Fingerprint Jewellery Business, check out the additional links and resources below and register for my FREE Mini Course on "How to Start your own Creative Home Business."


 

 

Links

http://go.thecraftecademy.co.uk/creative-home-business

http://go.thecraftecademy.co.uk/timeandfreedom