How to start a Business – Overview*

If you’re wondering how to start a business, there are some key decisions you will need to make before starting up. As well as your product or service, you may want to choose your business’ name, its structure and how you are going to run it. It is also important to think about how you are going to attract customers and where you will get the money for starting up.

Before you start your business

You may need to research and develop your basic business idea, work out what you are going to name your business and decide on what form it will take. It is important to think carefully about your product or service, audience and what makes you stand out from the crowd.

At this point, it is worth thinking about how you are going to finance your start-up and what effect it will have on your personal finances while waiting for profits to show.

Start-up options

There are a number of options available to you when starting a business. You might want to start your business full-time or part-time, or even in your spare time. You could choose to work from home or at separate premises, to buy an existing business or to invest in a franchise, depending on your experience, lifestyle and resources.

Assess your skills and see where you might need some extra development or support. Innovation Centre Iceland offers free events covering a wide range of business issues, including taxes, marketing, networking and business planning.

Developing new products and services

Table of contents

Overview
Identifying a new idea, product or service
1. Coming up with a new idea
2. Developing your idea
3. Developing new products and services
Is there a market for your idea?
1. Your competition
Plan the development of your idea
1. Judge your progress
Financing your idea
1. Phasing new product development
The product development process
1. The lifecycle of products and services
Test the market
1. Pricing your product or service

Market and customer research

Table of contents

Overview
1. Customer research and market trends
Competitor intelligence
Market reports
Interpreting market information
Quantitative and qualitative field research
Field research planning
Field research tips
1. Ask the right questions
2. Talk to the right people
3. Talk to enough people
4. Keep research impartial
5. Interpret results with care
6. Be realistic
Market research agencies

Write a marketing plan

Table of contents

Overview
Marketing strategy
Marketing plan summary and introduction
Marketing plan analysis and objectives
Marketing tactics
Marketing plan implementation
1. Resources
2. Cost
3. Control

Starting up: common mistakes and how to avoid them

Table of contents

Overview
Poor or inadequate research
1. Lack of in-depth market research
Weak financial planning
1. Lack of funding
2. Lack of a contingency plan
3. A reluctance to seek professional advice
Setting sights too high
1. Over-optimistic forecasts about market size
2. Focusing on sales volume or size not profit
3. Diversifying too soon
4. Poor planning
Taking your eye off the competition
Poor supplier and customer controls
1. Setting up poor supplier contracts
Hiring the wrong people
Poor stock and asset management
1. Poor stock control
2. Over-investing in fixed assets

Choose the right name for your business

Overview
Choosing a business name to create the right impression
Names for limited companies
1. Company names
2. Trade marks
Names for sole proprietors and partnerships
1. Is anyone else using your proposed business name?
Use of sensitive words and expressions in business names
Displaying and disclosing your company name
1. Displaying a name online
Getting your business name on the internet
1. Choosing a domain name
2. Registering your domain name

Intellectual property: the basics

What is intellectual property?
How you can protect your intellectual property
Patents
Copyright
Trade marks
Designs

Start a business from home

Start a Business from home – Overview
Is starting a home-based business right for you?
1. Advantages and disadvantages of home-based business
2. Addressing the disadvantages
Popular home business ideas
1. Popular home business ideas
2. Working ‘five to nine’
3. Your business plan
Start-up costs and your work environment
1. Your work environment
2. Workspace priorities
3. Work equipment and workstation setup
Record keeping
IT and home business
1. Building a website
2. Networking
3. Working away from home
Your growth options
1. Outsourcing
2. Developing relationships
3. Meeting spaces

Starting a part-time business

Overview
Part-time businesses: tax and legal obligations
1. Continuing in paid work?
2. Just running the business?
Part-time businesses: what to consider
1. Are you ready to start up?
2. What legal structure?
3. What about premises?
4. Money matters
5. Professional advice
Support for part-time businesses
Part-time businesses: pros and cons

Finance for start-ups

Different routes to financing your startup
1. Personal savings
2. Friends & family
3. Banks
4. Venture capital
5. Angel Investors
6. Corporate Investments
7. Crowdfunding
8. Grants
Credibility
Financial statements
Personal survival budget
Cash flow forecast
Balance sheet
Profit and Loss Statement (P&L)

Business planning for startups

Business plan
Pitch deck

Starting a business in Iceland - a practical guide

Table of contents

Introduction
1. Personal ID (Kennitala)
2. Electronic Certificate (Auðkenni)
Licensing and permits
1. Brief overview of the most common organisations that issue operating licenses
2. Example of the different agencies that need to be engaged when establishing a restaurant
Business structures and how to register them
1. Individual Company – Einstaklingsfyrirtæki
2. Private Limited – Einkahlutafélög (ehf.)
3. Limited Companies – Hlutafélög (hf.)
4. Partnerships – Sameignarfélög (sf.)
5. Syndicates / Co-operatives – Samlagsfélög (etc.)
6. A self-employed business enterprise – Sjálfseignarstofnun í atvinnurekstri (ses.)
7. Branches of foreign companies in Iceland – Útibú erlendra félaga á Íslandi
8. Registration of companies forms (ehf./hf./sf./slf./ses.)
The process for registering a private limited company
1. Search for company name
2. Apply for registration with Register of Enterprises
3. Deposit initial capital in bank account
4. Obtain a VAT number. Notify tax authorities of employment of workers
Income tax & VAT (Value Added Tax)
1. Income tax
2. Business income tax base
3. Difference in income tax according to business structure
4. VAT (Value Added Tax)

Practical guide to doing business in Europe

Materials from RYE – Rural Youth Entrepreneurship Ⓒ

START

Want to get your idea off the ground? We’ll help unlock your potential, provide you with a range of business resources and insights that will help you avoid the pitfalls and set you on a strong foundation for business success.

Growth

Already running a business? We’ll help you explore the opportunities for growth, develop a growth model just for you and help you take your first steps towards upscaling and trading outside your home country.

Reboot

Struggling to get your business where you want it to be? We’ll provide you with a support path. Gain a greater understanding of why your business may be failing, plan a course of corrective action and get yourself back on track.

*All the text in this english guide, is work of Philip Farren, a former Project Manager at Innovation Centre Iceland(ICI). Philip made this excellent guide for the ICI, shortly before it was shut down but this guide was transferred to University of Iceland, along with other projects.

Please respect Philips work and if you use any text from here in a public manner, please refer to “Philip Farren, How to start a business in Iceland – an English language guide. Innovation center Iceland, 2020.”