Things to do before you start trading
By the 4W1N team ·
A launch date feels like a finish line. It isn't. It's the day your business becomes real: customers start relying on you, and the tax office and the rules start to apply. The exciting jobs (the website, the announcement, the first post) usually get done. The unglamorous ones are what quietly cause trouble later.
This is a launch checklist for first-time founders: what to sort out before you take your first payment. It's general guidance, not legal or tax advice, so check the specifics for your business with an accountant or solicitor.
Make sure five things are true. The product is ready to sell. The business is set up properly. You're protected if something goes wrong. You know what launch costs and how it's paid for. And you know who your first customers are. Launch when you're ready to be trusted with a customer's money.
Step 1Check the product is ready to sell
"Ready" doesn't mean perfect. It means a stranger can buy it, use it, and get what you promised. Ask yourself:
- Can someone buy it today, from start to finish, without you stepping in?
- What happens when something goes wrong, and who sorts it out?
- Has anyone outside your circle used it?
- What are you leaving out at launch, and are you honest about that?
Launch the smallest version that delivers the promise. You can add the rest once you know what customers actually want.
Done whenA stranger could buy it and get what you promised, and you know what you'll do if they don't.
Step 2Set the business up properly
Decide how the business will be structured, for example as a sole trader, a partnership or a limited company. Each one affects your personal liability, your tax and your paperwork, so this is one decision where it is worth getting advice. The government's own guides are a good place to start: how to set up a business, become a sole trader, or set up a limited company.
- Register what needs registering for your kind of business.
- Keep business income and spending separate from your personal finances. A business bank account makes this much easier, and some banks require one for business use.
- Find out which rules apply to what you do. Some businesses need licences, inspections or specific registrations before they can trade. You can find out which licences you may need.
Done whenYou've chosen a structure, you know which rules apply to you, and your money is separate.
Step 3Protect the business before you launch
This is the least exciting step and the one people most often skip.
- Put things in writing. Your terms for customers, any agreements with suppliers, and, if you have co-founders, who owns what and what happens if someone leaves.
- Check your insurance. What you need depends on what you do. A broker can tell you what applies to your kind of business.
- Protect what you've built. Check whether another business is already using your name, and search the trade mark register. Secure your domain, but remember that owning a domain doesn't give you the right to use a name commercially. If the name matters to your business, get advice before you commit to it. And be clear about who owns anything someone else made for you.
Done whenYour key agreements are written down, you know what cover you need, and the name is yours to use.
Step 4Work out how much money you need
List the one-off costs of getting started, and the running costs that begin on day one. Then add the one most people forget: your own living costs while the business finds its feet.
The question that matters most is how many months you can keep going if sales are slower than you hoped. That number tells you how much room you have to learn.
An illustration: if the business costs £1,000 a month to run and you need £1,500 a month to live on, you need £2,500 a month before any surprises. With £10,000 in savings and no sales, that lasts four months. Every pound of sales stretches it. Use your own figures, not these.
Done whenYou have one list of costs, including your own, and a number of months you can last.
Step 5Work out where the money will come from
Work out where the money is coming from: your savings, early customers, a loan, a grant or an investor. Each has a different cost. Money from customers doesn't have to be paid back, which is why early sales matter so much.
Be honest about the gap between what you need and what you have. A gap you've named is something you can plan around. A gap you haven't named is what ends launches.
Done whenYou can say where each pound is coming from, and how big any gap is.
Step 6Line up your first customers
Don't wait for launch day to find them. Know who your first ten are likely to be, and where you'll reach them. Two of our guides help:
- What to do before you write a business plan: how to talk to the people who have the problem.
- Does a small business need a marketing strategy?: where to find them and what to say.
Done whenYou can name your first ten likely customers, or the exact places you'll find them.
What this looks like: an example
Say you're setting up a small business selling made-to-order cakes. This is what "done" could look like for each step. It's an illustration, so your own business will differ.
For food, the rules include registering your business with the local council. See the government's guide to food business registration. The rules for your own kind of business will be different, so check them.
What order should you do it in?
Not everything takes the same time. Start the slow things first and leave the quick ones for the end. Lead times vary a lot between businesses, so treat this as a guide, not a timetable.
- Registrations and licences for your kind of business
- Insurance quotes and cover
- Written agreements with co-founders and key suppliers
- Lining up the money you'll need
- Your terms for customers
- Your bank account and a costed launch budget
- Letting people outside your circle try the product
- Securing your business name and domain
- Buy your own product from start to finish, as a customer would
- Rehearse what you'll do when something goes wrong
- Have your first customer messages ready to send
The mistakes that cost the most
Most launch problems come from a short list of things that were skipped because they were boring.
- Having no plan for when something goes wrong, so the first problem lands on a customer.
- Mixing personal and business money, which makes everything harder to track and explain.
- Leaving agreements with co-founders unwritten, until someone disagrees or leaves.
- Forgetting your own living costs, so the runway is shorter than you think.
- Finding out about a rule for your kind of business only after you've started trading.
Are you ready to start trading?
Run through this honestly. If a few boxes are empty, that isn't failure. It's your to-do list for the next few weeks.
You don't need every possible feature, channel or process in place. You do need to understand the risks you're accepting and the responsibilities you're taking on.
A few more questions
How far ahead should I start?
Sooner than you think. Some things, such as registrations, insurance and agreements with suppliers or co-founders, take longer than expected. Start the slow ones first and leave the quick ones for launch week.
Do I need everything perfect before I launch?
No. Launch the smallest version that is safe and honest. The things to get right first are the ones involving customers' money, their safety and your legal obligations. Almost everything else can be improved after you've started.
Can I start trading before I've registered my business?
It depends on how you're set up and what you do. A sole trader doesn't form a company, but may still need to register with the tax authorities and meet other obligations, and some activities need a licence or registration before you start. Check the official guidance for your situation before you take your first payment.
Do I need a lawyer or an accountant?
Often a short conversation is worth it, especially for your legal structure and key contracts. This guide helps you arrive at that conversation prepared. It doesn't replace the advice.
What's the difference between a launch plan and a business plan?
A business plan is the whole thinking: the customer, the market, the model and the money. A launch plan is the practical side of being ready to start trading. Is the product ready? Is the business set up? Are you protected? Is the launch costed and funded?
Where 4W1N fits in
A launch checklist tells you what needs sorting out. The harder part is the decisions behind it: what you're selling, who will buy it, how you'll reach them, what it will cost, and whether the idea stands up outside your own head.
That's what 4W1N is for. Its workshops ask you one specific question at a time and build in Reality Checks that get you talking to real people and trying to sell for real. Then the Startup Launch Plan brings the practical side together: where the product stands, getting legally set up, protecting the business, what launch will cost and how it's all being funded.
In Workshop 5 you record your legal structure, compliance, contracts, insurance and how you're protecting your idea, next to your start-up costs, how long your money will last and your funding. The result is a plan you can share with an accountant, a solicitor or a co-founder, so everyone is looking at the same picture.
It doesn't give legal or insurance advice, and it doesn't replace an accountant or solicitor. It helps you arrive at that conversation prepared.
Launch when you're ready to be trusted with your first customer's money.