Enterprise - Finance

We calculated our overheads based on standard expenditure costs including rent (at £399/month at Duke Studios); software - Adobe Creative Suite, MS Office and various studio equipment, travel and research costs and so on.  

Based on an initial £25,000 salary for year 1 (£17,127 after national insurance and income tax), our annual income required is £100,000 alongside the total overhead costs of £17609.05. Using these values, and based on 244 available work days, our minimum daily charge rate as 'Craft' is £482.  

As we intend to make a profit in the first year to account for various contingency costs (including small business loans and dividends), our actual daily charge rate is £600. This will provide an annual pre-tax profit of £28,792 and a total net profit of £23,033.60. However, as we want to offer the best and most affordable service as possible, the amount we can charge can be anything above £482.

Enterprise - Website design

I decided to design some initial website design ideas to experiment with applying our brand to other forms of media. Our website will be a useful tool in creating an online presence - advertising through social media including Twitter and LinkedIn and various online networking tools. As we have consistently kept a minimal / monochrome aesthetic, I kept the design concise, focusing primarily on type layout.

Using the copy created by Max, as featured on our publication, I decided to create a piece of text which will be presented to the viewer upon the first load. It will provide a brief insight into who we are, what we do and what we can offer to suit their needs.

Enterprise - Publication / Handout

For our final presentation, we decided to create a publication / paper portfolio that would provide a brief insight into our business accompanied by some samples of our work. A4 format to fit in an A4 sealable plastic wallet - printed on A3.

We each sourced our own logo design work to incorporate into the portfolio accompanied by a short description as to who the client was (dependent on whether it was live or not') and what deliverables it was applied to (business card, packaging etc).

Enterprise - Start up business loans

Small business loan

I initially looked at Natwest due to its reputation it has with helping start-up businesses - plus Luke had a brief chat with the business manager. A small business loan is ideally suited to small businesses like ours. Based on ongoing overhead cost estimates (£17,609.05), this choice seemed the most plausible as this service is for loans up to £25,000. 

Start-up package

Natwest offer a start-up package for upcoming businesses who are either beginning to trade or have been trading for less than a year. It offers two years free business banking, a fee-free overdraft 

Business plan

Natwest also offer a service where we can create an online business plan, as seen below. The layout is easy to navigate, clear and concise, and provides all the necessary information for a start-up business. However, I have used the business plan provided by BusinessLink as a basis of our own. This service could prove useful, however.

Enterprise - Finance / Accounts

Salary

Based on our initial cost of living costs, we decided to give ourselves an initial start up salary of £25,000 before NIC and tax. The after tax net salary amounts to £19,362, based on the 2011-12 tax year.

Enterprise - More expenditure costs

Business insurance

Using www.moneysupermarket.com, we decided to draw up a quick estimate as to what insurance we may have to pay. However, as we initially chose a partnership structure to base our business on, the amount may differ from the one below. In this case, they provided an estimate of £265.

Based on a limited company

As you can see, the quote is around £120 more than if we were a partnership.

Other equipment costs not accounted for

Although we initially disregarded the following, we decided it would be beneficial adding these to the existing equipment costs to provide a more accurate estimate. 

Accountant

Luke got in touch with a friend of his who trades as an accountant and he provided a rough estimate of around £350 - £400 for a small, start-up business like ours; based on what we intend to turnover.

Enterprise - Limited Company

We are now... a limited company with equal shareholding between all four members.

We initially decided to run as a partnership due to the equal opportunities it offers. However, after looking back at my research and requesting advice from my parents (as my dad has set up his own business), we decided to look at becoming a limited company due to the multiple benefits it offers.

Reasons why:

- Liability is limited, which protects your personal assets from your company's debts, and means that your company can apply for credit, loans and mortgages in its own name.
- Because limited companies have records with Companies House, they are often seen as a more reliable and secure option than non-limited companies.
- The availability of your company's records may help creditors and customers build up a sense of trust and faith in your business.
- Being a limited company also protects your company name so that no other company can use it.

Source: duport.co.uk