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21 April 2022
Year 1 Challenges for Start Up Businesses by LWA

Many of the issues identified will have easy solutions, achievable with the use of appropriate accounting software that your accountant can help implement and use to help your business grow successfully.

Accounting software is a must but shouldn’t replace your accountant!

A massive 64% of business owners that responded to the poll, said that taking time off was impossible over the first 12 months, with 29% saying they weren’t able to switch off and 40% getting less than six hours of sleep a night. This is where having a support network including a qualified accountant can help.

Many people will assume that by signing up to a cloud accounting software provider such as FreeAgent or Xero, they can manage their bookkeeping and accounts themselves and therefore do not need an accountant – big mistake! Whilst nowadays it is vital to get your business set up on a platform such as Xero where you can keep a track of costs and sales, your accountant will be able to use these statistics together with information gained from face-to-face discussions, to ensure you are not paying excessive tax when it comes to submitting your tax return, and that you are making the most of tax reliefs and adhering to legislation.

Furthermore, by using Xero your accountant can help automate a lot of your bookkeeping needs by setting up bank rules and reducing multiple clicks to single clicks for reports, helping entrepreneurs to save time to do what they do best; run their business.

Keeping on top of paperwork

Receipts for those start-up expenses and supplier invoices, can all begin to pile up when setting up a business, and 23% of respondents said keeping on top of paperwork was a struggle. However, you’ll be pleased to know gone are the days where you need to keep receipts and paperwork in a shoe-box ready to organise until tax-return time! Digital expenses processing company, Dext, allows you to instantly allocate and electronically store all your receipts and invoices with a quick photograph on your smart phone, or via a dedicated email address you can forward invoices to that connects to your Dext and Xero account.

Having very little money

It’s well known that to start up a business, people often use up most or all of their savings, remortgaging their homes or taking out a loan, leaving little money for personal luxuries, and 30% of the entrepreneurs answered that this was a concern. However, starting off on the right foot with forecasting and planning will help improve cashflow and determine if and when your dream business can start generating a profit. Tools such as Futrli Predict have been created to help resolve cashflow issues whilst at the same time generating instant management accounting reports and predictions, to help business owners make vital decisions.

In addition, the Satago app can offer an alternative means of gaining finance where the traditional bank route may not be appropriate. This can be done very quickly as it uses the data in Xero to get personalised finance deals.

In today’s challenging economic climate with rising fuel and energy prices, having software in place such as Reducer, can help businesses save an average of £1,450 per year on their essentials.

Learn from others’ mistakes and it’s not all bad!

Despite the pressures seen in their first years of business, 91% of the entrepreneurs that answered questions were glad they started their companies, and 77% would recommend running a business to others. Six in ten said that they would do things differently now – so, if you’re thinking of starting your own business, perhaps consider getting set up on the accounting software mentioned throughout our blog.

All of the above-mentioned software including Futrli, Dext and Reducer work seamlessly with Xero to make your life as a business owner less stressful. At LWA we are Gold Champion Partners for Xero, Certified Advisors for Futrli, Pioneer Partners with Dext, and Gold Certified Partners with Reducer.

Let us help your start-up dream become a real success story

Our team at LWA are here to help your business grow. Just like the 70% of respondents that

said the best thing about launching an enterprise is being your own boss; the 55% who loved having satisfied customers; and the 48% who said making a profit was great – we want to help you realise your business dream whilst achieving the perfect work-life balance.

If you’d like to learn more about the benefits we could bring to your business or about any of the accounting software mentioned above, please contact our in-house Digital Client Experts Matt Jones and Bradley Allen-McKenna on 0161 905 1801 in South Manchester or in Warrington on 01925 830 830. You can also email mail@lwaltd.com.

To read the original article with the full Entrepreneur poll responses, please click here.