Starting and selling a business
Complex economic outlook
Anyone contemplating starting a new business, especially a bricks and mortar one, needs to factor in current economic conditions. The UK economy performed better than expected for the first quarter of 2024, and inflation has now fallen to 2% (May 2024); half what it was at the start of the year. Against this backdrop must be set the uncertainty of having a new Labour administration, although the clear outcome of the election could return the UK to a steadier footing. However many self-employed businesses, in particular, are still struggling with higher costs, and customers, generally, have less money to spend.
High energy costs have been a huge problem for many businesses for more than two years now, and there is no indication that prices will be significantly lower throughout the remainder of 2024. This is far from ideal for a new business which will want to plan at least two or three years ahead.
Your plans will also need to factor the general skills shortages across the UK, meaning salary expectations could be considerably higher than you are expecting. Related to this, the Labour government has said that they will increase the minimum wage and also remove age bands so that all adults are entitled to the same minimum wage; this will add to your costs.
When it comes to selling a business, it doesn’t matter whether you are developing a business idea to quickly cash in before starting all over again (the typical serial entrepreneur), planning a smart career move (with the successful sale of a selfstarted business looking very good on your resum.) or are in for the long haul – planning your exit strategy at an early stage will ensure you don’t pay more tax than necessary. This might be just the time to do that planning.