Five tips for CAs who want to start their own business
Kirsty Dingwall, founder of Angelic Gluten Free, shares her experience of starting her own business, ahead of her appearance at the ICAS Conference on 27 November.
After I graduated from Strathclyde Business School with first class honours in accountancy and completed my training with one of the 'Big Four', not many people expected me to leave a relatively safe job and start baking cookies in the kitchen!
I founded Angelic Gluten Free in 2012 and today our products are available in over 500 outlets in the UK, and we are achieving steady growth in our export markets.
I’ll be sharing my story at the ICAS Conference in Glasgow on 27 November, but in the meantime, here are my top five tips for starting a new business.
1. Be prepared to live and breathe your business
When starting a new business you have to live and breathe it 24/7, and you will have to give it your full energy to get from the idea stage to trading. You need to be passionate about what you’re doing, as this will give you the belief you will need to get you through the difficult times, and you can be sure there will be difficult times along the journey.
When I was setting up my business, I was studying for my TPE exams and working full-time. I had a burning desire to get my business idea to a position where I could leave my full-time job when I qualified as a CA, and would spend my evenings and weekends researching the market, developing my first range of products in the kitchen, and designing packaging. I literally couldn’t stop and because I cared about what I was doing, and had such a passion for my product, I would do whatever it took to launch my business.
2. Research your idea, and write a detailed business plan
Knowing the market that you're about to enter is vital, and you must understand the competition, pricing, and consumer needs. Equally as important, invest time in preparing a detailed and realistic business plan that clearly outlines your objectives, and how you plan on achieving them.
There will be a number of scenarios where you will be asked to present a business plan, whether it’s to a bank, or an enterprise advisor, and demonstrating a sound and cohesive plan will give other parties confidence in your ability to deliver. Preparing a plan will also help you to understand your route to market, which many businesses fail to understand in the early days. Ensure that the plan is concise, and clearly explains how the business plans on making money, and how you will realise the return on your investment.
3. Look at the resources and tools around you
You would be amazed by what you can achieve with limited resources, and for many businesses today, you only need a computer, online access, and a phone. Look at your existing resources, such as a kitchen table, empty garage or bedroom, and think about the possibilities.
I started the business on the kitchen table and delivered a finished product to over 350 independent stores and health shops throughout the UK from in-house. Nowadays I mainly run my business on the go using my smartphone, processing orders, arranging deliveries, and acquiring new customers, with our products manufactured in a commercial bakery employing up to seven members of staff. We mainly operate from the cloud and as we grow, we plan to invest more in updating our technology.
4. Keep your eyes on the cash
For a new business to survive, cash flow is the single most important financial factor. A new business may be able to endure negative cash flow in the short-term, but eventually, it’s vital to focus on creating positive cash flow.
During the early stages of launching the business, controlling cash was a key priority. I put procedures in place to chase outstanding debts, and sought the longest credit terms for our creditors. We operated with an overdraft facility for the first year, however made it an objective to trade without an overdraft in year two. Managing cash on a daily basis is very important, and still remains a key priority.
5. Develop the right mindset, and don’t give up
The biggest challenges of starting a business are the internal ones, such as overcoming fear and self-doubt. You will always come across the doubters and critics, but with hard work, self-belief and determination, you can overcome these negative influences.
My first funding application was declined and I was told by a member of the panel that it would be wrong to offer me a loan. One advisor even suggested that offering finance would be like leading me to a cliff edge, and asking me to jump off. It was very difficult to hear such criticism, however I was determined to prove them wrong. To overcome the knockback, I reflected on my accomplishments and prepared myself for approaching a new lender. The rejection motivated me to work harder and made me even more determined to achieve my goals. Throughout my journey I have, and will continue to, learn from my mistakes and gain strength from my successes.
Kirsty is a judge in the 2016 One Young CA competition, which recognises CAs under 35 who are making a difference to our profession and beyond. Visit oneyoungca.icas.com for further details.