Achiever Talk: Getting Your YE Company Going
The First Few Weeks
This piece is from an excellent blog called Achiever Talk which provides advice for Young Enterprise participants. Here the author introduces himself:
My name is Paul Davies. I have been a business advisor to Young Enterprise companies for two years, and was named Young Enterprise Business Advisor of the Year 2009 for the East Midlands region. I work for HP in the UK as an Information System Architect. HP are a global supporter of the Young Enterprise and Junior Achievement organisations and kindly allow me to volunteer and attend achiever meetings during my working week.
From working with a few Young Enterprise companies I have noticed that the more successful companies are those that get an early start on the key tasks. Once you have your company formed, and a product idea decided the quicker you can get your product or service to market, the sooner you start making money.
Here is a list of tasks to get you started.
Like writing an essay, or a session at the gym, the hardest part is starting. The first couple of weeks can feel heavy going, but once you get into it the milestones fly by. What you don’t want to do is faff around for weeks on end and find out that you have missed the crucial Christmas sales period.
So here is my list of what kind of things need to doing in the start-up phase. The topics are not listed in any special order and don’t need to be done in sequence; in fact to get up and running as quickly as possible it makes sense to divide the work out between the company directors and work on it concurrently. You don’t have to do them all – some of them might not apply to you. But whatever you do, make sure you start doing something on this list as soon as you have decided on your product / service.
To ensure your company is set up properly and registered with Young Enterprise so you are eligible for the competition and covered by insurance. Setting up templates and processes early will help keep good records which will save time and mistakes later!
Set up company as per YE instructions / process
Make sure all students registered on Company Programme web site and can access it
Schedule board meetings
Set up Agenda and meeting minutes templates
Set up attendance recording (e.g. spread sheet)
Arrange somewhere to store cash, materials, stock
Business Plan & Funding
Writing a business plan will make sure you have thought of everything you need to do and help potential investors understand what your company is about. Some area boards run a competition for the best business plan.
You will need money (capital) to start up your business – to pay for materials, company registration etc. To raise money, you need to sell shares.
Determine how many share you need to sell (with Financial Director)
Set up shareholders’ register (e.g. spread sheet)
Organise all company members to sell shares
To determine who is going to buy your product (if at all!), how much they are prepared to pay for it and what they would like your product to be like.
Research other companies selling products or services like yours – how much do they charge, how much do they sell, how do they sell?
Find out from your potential customers (by questionnaire, survey or focus group) what their ideal product would look like.
Confirm that your product is worth making, will sell, and will make you a profit. If it does not, you have time to do something else.
Decide how your product will stand out in marketplace against similar products. How will it be different?
To turn your idea into a product or service you will have to create prototypes of different designs, colours etc. and experiment with manufacturing methods to determine the best way of making your product.
Write prototype designs and specifications.
Make prototypes and test them with your target customers. Repeat until you are happy with the product.
Once you have a final design, list the “bill of materials” for the procurement activity.
Decide on packaging / labelling.
Determining how, where and when you can sell your product to reach your target market and maximise sales. A sales plan will also help the Operations Director plan how many of your product to make and when.
Decide route to market. Through shops or retailers? Online? Direct sales to public (for example car boot sales, craft fairs, school events, markets etc.)
Book stands at fairs, markets etc.
Set up web site and (Young Enterprise approved) electronic payments
Write sales pitch and brief / train other team members.
Decide pricing strategies. Will you have volume discounts? Different pack sizes?
Working out where to buy your raw materials from balancing the amount you need, cost and ease of purchase.
Document what materials you need and when.
Decide on volumes. Do you want to bulk purchase at the start, or buy smaller quantities as you go?
Where will you buy your stock? Research potential suppliers – Internet based, local shops, trade wholesalers.
Get samples to check the materials work for you. Use them to build a prototype.
Making sure you have all the skills and tools needed to make your product safely at the lowest cost and effort.
Decide if you are going to manufacture yourselves, or outsource to someone else.
Create a set of instructions for manufacturing your product consistently and safely.
Make any decisions about manufacturing method – for example if you are painting something will you use a brush, spray can or other method?
Decide on a manufacturing schedule. Who is going to make your product, where and when?
What facilities do you need? Do you need specialist equipment from school or outside suppliers? Do you need to book access to facilities? Can you make it at home?
Health & Safety Plan
You need to make sure your company members are safe and don’t get injured (or worse) when making and selling your product. To make sure your product complies with any legal health & safety requirements.
Conduct and a risk assessment of your manufacturing process (if applicable).
Write a health & safety policy.
Study the Young Enterprise and trading standards guidance on product safety and legal requirements and make sure your product complies.
Cost Price Analysis
This one is important! Making sure you sell your product at a high enough price to make a profit!
Determine / estimate your fixed and variable overheads
Determine the unit cost of each product you make.
Decide on a selling price (in conjunction with Sales Director)
Make sure you profit margin is acceptable.
Look for cost savings.
Create a brand and image for your company suited to the product you are selling. A strong, consistent brand will boost sales and inspire confidence in your product.
Write your mission statement. Why does your company exist? How will it benefit or change the world?
Design logo and branding (colour scheme, fonts etc.)
Produce posters and point of sale material
Set up a web site
Design your stall (if selling direct to public)
Hope that’s useful… anything I have missed? Let us know in the comments.