Mogul Tips

Marketing is a key element of small business survival and expansion. Read how to do it effectively in our guide. Once you decide to go ahead with a new plan for a business or its expansion, you need to put on your salesman hat and start marketing the idea.

YOUR MARKETING STRATEGY
The first thing you need to do is research the market you are targeting.

Who will your competitors be? How is the sector going to fare in the next five years? Is there really a gap in the market that you can exploit? Approach all these questions objectively - don't get carried away with the excitement of a new venture.

Assess who your potential customers are and work out how you are going to reach them. It is also a good idea to know who your most lucrative customers will be.

DO YOUR RESEARCH
There are various forms of market research you can use, such as free Government statistics and business reports, professional paid-for research carried out on your behalf and research done yourself in the form of surveys and fieldwork.

TESTING THE WATERS
If you are testing a new product, ask as many people as possible, from as many different age ranges and walks of life as possible to try it.

Try not to use only family and friends as guinea pigs - they are more likely to give you good feedback, even if they don't like the product!

PROMOTION AND SELLING
How should you promote your products? Options include advertising, direct marketing, exhibiting at trade fairs and online marketing.

How you tell people about your business will be determined by the type of customer you are going for and your advertising budget.

What is the best way of distributing and selling your products? You could sell directly to a few key customers, or go through retailers. Setting up shop online can keep overheads down.

If you are selling a product, you could approach other firms to sell it, or license it to them. But don't talk to them unless they sign a confidentiality agreement (usually drawn up by a specialist solicitor) first, so they don't steal or reveal your idea. For the best chance of success make a prototype and stage a smart presentation.

If they want to buy your idea or license it from you, you both sign an agreement. This usually gives you an upfront fee - often quite small, anything from £500 to £5,000 - and a royalty on sales, usually 2%-7% of the selling or manufacturing price of the invention. Consult a patent agent about what is a fair amount.

OTHER MARKETING OUTLETS
Fairs and exhibitions typically charge around £400 for a stand. You may meet interested companies, get tips from more experienced inventors, garner some publicity or even win a prize for your invention.

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Thousands of people set up their own businesses every year. Some do it because they want to work for themselves, others because they have a great idea and have spotted a gap in the market. And of course there are those that think they can make lots of money.

These are all valid reasons for starting a business. Commitment and motivation are vital and whatever it is that drives you to make it a success good.

Although enthusiasm is important, good planning is a must. Without a good business plan you could struggle to make a go of it.

There are many issues to think about:

What will the business do?
Where can it operate?
Will I need premises?
Do I need people to make it happen, or will
I be flying solo for some time?
Can I fund the business myself, or do I need financial support?
How long will it take to get the business into profit?
Have I got what it takes to make it work?

There is no right or wrong type of person to run a business. If you are determined to make it succeed, and are prepared to work long hours, then you have the ingredients for success.

If you look at top business people, the one thing they have in common is determination. They do not give up at the first hurdle and they keep going until they succeed.

OBSTACLES AND SETBACKS

There will be many of these but how you overcome them will be critical to deciding whether or not you will ultimately succeed. If you are not the sort of person who responds well to setbacks, you ought to ask yourself whether you are the right person to be trying to get a business off the ground.

FINANCES

You need good advisers - usually an accountant and a lawyer - when you are handling complex issues such as finances, tax and business law. All businesses require a certain amount of administration and you will have to spend time going through paperwork. If you tend to bury your head in the sand and ignore detail, you need a good right-hand person who will concentrate on the detail. Not all great business leaders were good at the small print, but all good business people have someone close to them who is.

ADVICE

Our guides will help you through most of the process of starting a business. If you need further help, try organisations such as Business Link, the Federation of Small Business and other bodies such as the Institute for Chartered Accountants in England & Wales (ICAEW) and the Association of Certified Chartered Accountants (ACCA).

It is one thing to day dream about a great idea or invention that will make you millions, but quite another to turn it into a viable business.

But it can be done, as thousands of British entrepreneurs prove each year. If you have a 'eureka' moment, you must protect your idea. If your business centres on an invention, this is done by means of the patenting process. If you run a business along more 'intellectual' lines - for example, selling photography or producing literature - copyright is your protection.

It won't be cheap - but it will be worth it. Vacuum cleaner tycoon James Dyson famously spent many many thousands of pounds on patents long before any of his products came to market, but had he not done so his unique cyclone technology could have been appropriated by rival manufacturers.

PATENTING: THE BASICS

Before you begin the patenting process, you must research whether your idea really is new, otherwise you will not be granted a patent.

Once you establish that your idea is unique, discretion is the key. Keep your plans secret until a patent application has been filed.

You can do this free of charge either on the Patent Office website (see links below) or at a public library with a patent department. If your search brings up nothing you should then go to a registered patent agent or search bureau, although this can be costly. Agents should be part of the Chartered Institute of Patent Agents.

KNOW YOUR MARKET

Check there really is a market for what you are offering: Who wants it? Where are the customers? Will it solve an existing problem better than anything else currently available?

Look at which companies and products are your potential rivals and what market share they have - can your invention compete with what they offer at a competitive price? For example, you may have developed a new paint - but could you compete with ICI? You could, of course, revolutionise the market with your innovative new product. But Patent Agents and the Patent Office should be able to offer advice on this.

DEFINE YOUR IDEA

Write down clearly what your invention is, how it works, how it could be made in bulk and at what cost, and what its advantages are, including a simple drawing if it is mechanical or electrical. Then take out a patent either yourself (very difficult) or via a patent agent.

PATENT PROCESS AND COST

If you apply yourself, Patent Office fees will cost £200 from initial filing to a patent being granted. The process takes about 33 months (the fast track system can take under a year for the same price).

Drawing up patent documents is a skilled job, so it is usually better to use a patent agent - the Chartered Institute of Patent Agents can put you in touch with one.

For a simple invention an agent may charge between £600 and £1,000. Your initial application protects your invention for a year, and although protection can be extended it becomes more expensive, especially for international patents. Try to find a company to buy or license your invention in the first year to save money.

COPYRIGHT: THE BASICS

If you create 'intellectual' works you automatically hold the copyright on them. This lasts for 70 years.

You can't claim copyright on slogans, names or titles, although these can sometimes be trademarked. Copyrighting also gives you the 'moral rights' to your idea. This means you can object to infringements of your idea.

Copyright is automatic in the UK - you don't have to apply for it. However, it is worthwhile appending your work, where possible, with the international copyright symbol (©) followed by the year of creation and your name.

Under international conventions, this protection extends to overseas territory and allows you to control how your work is exploited for money and how it is copied, adapted, published, performed or broadcast. This can be an important source of income for some businesses.

Remember, if you use contractors, they hold the copyright unless you agree otherwise.