On IS at present can I get help to start my own business?

the_butterfly

Hi I'm a single mother on IS. I was made redundant from my job after 25 years there. I was very down when it happened but now I have had enough of the struggle and want to start my own business. Is it possible to get help to do this? I am a book-keeper so would not need an accountant to do books so this will save me money. I want to offer a service (hair, beauty and holistic therapies) to people at prices they can afford on benefits. These are not luxuries these are needs. When your hairs a mess you feel bad. If your feeling down a little bit of pampering will cheer you up. I have never experienced such despair as being unemployed and having your "comfortable life" taken away and having to learn to budget with nothing.

InsideInsurance

What "help" are you talking about? Business advice or ?

the_butterfly

I am talking about financial help. Are there any DWP incentives? Are there any grants available to single parents with small children? I am totally in the dark with regards to this type of help.

paulwf

Hi Butterfly,

A good first place to start is the Business Link website https://www.businesslink.gov.uk . The guides are well written so dedicate some quality time to going through the relevant sections of the site. You should be able to call your regional centre and unless things have changed they offer free local startup courses.

Also check out the business section of your local paper (ours publishes one monthly) and you should be able to find out details of any local enterprise agencies, council initiatives and that sort of thing. It has to be said a lot of support and grants have been pulled recently but do some digging and a lot of free advice should be available.

Personally at this stage I would write a brief business plan fleshing out the details of how you will operate (do you need premises or a vehicle?), what training you may need, how much equipment and stock will cost, any insurances and that sort of thing. You will also need to do cashflow projections and most importantly profit projections and have some way of backing those up. Without having a rough plan in place it is impossible to look for assistance (financial or otherwise) as you won't have a clue what you will be requiring.

Do you intend to run this as a conventional business or a type of not for profit or social enterprise setup? Whilst I think you have a great motivation you need to be honest about what types of customers are likely to be most profitable unless you intend to run it as more of a community scheme. Most businesses also require about 70 hours a week input from the owner each and every week for the first year, how much time can you realistically spend away from your child at the moment?

There are ways you can make this work (and you certainly have the passion) but until you have a little bit more structure it is hard to advise on the best route to take so get started on your business plan!

palomapicasso

Hi The Butterfly, I am on IS too and would love to start my own business so I had a look on the DWP site and there is an Enterprise Allowance Scheme and apparantley this is new. It says that you can be mentored and if your idea/business is viable you could receive £65 per week for 13 weeks then for the next 13 weeks £33. If your business plan is accepted you could also receive a start up grant of £1000. Get to work girl! I will be making an appointment to see someone with regards to this.

chalkie99

palomapicasso wrote: »

you could also receive a start up grant of £1000.

What it actually says is "loan" not "grant" so not quite the freebie you might think.

As to the OP - she talks about offering a service

to people at prices they can afford on benefits

which probably means it won't be seen as a viable business plan.

motorguy

the_butterfly wrote: »

Hi I'm a single mother on IS. I was made redundant from my job after 25 years there. I was very down when it happened but now I have had enough of the struggle and want to start my own business. Is it possible to get help to do this? I am a book-keeper so would not need an accountant to do books so this will save me money. I want to offer a service (hair, beauty and holistic therapies) to people at prices they can afford on benefits. These are not luxuries these are needs. When your hairs a mess you feel bad. If your feeling down a little bit of pampering will cheer you up. I have never experienced such despair as being unemployed and having your "comfortable life" taken away and having to learn to budget with nothing.

Are people on benefits going to be able to afford ANY money for hair beauty and holistic therapies? And if they can, is it going to be enough for you to take a wage from?

I would honestly suggest not.

the_butterfly

Hi, my business would not be exclusively for people on benefits but it will offer services at prices that will not be OTT like most salons. People could have money from birthdays, christmas or they could join "the club" where they can put money away each week to cover these costs. We all want to feel good and unfortunately when our roots need doing, or we are in desperate need of a cut/colour/perm etc this makes us feel 100 times worse - speaking from my own and friends experiences only. I know I will be able to make a decent wage without ripping people off. I've got an appointment to speak to someone in 2 weeks time as the person who deals with this is on holiday.

chalkie99

The problem with that is:

a) You cannot alienate the better off customers by making them subsidise those on benefits so you have to give low prices to all.

b) It is a trade, like most others, that is oversubscribed, i.e. there are already too many businesses chasing too few customers. The result of that, in free trade, is that competition forces prices down to a level. I am just wondering if the prices which you think are "OTT" are actually more realistic than you might think as there are usually hidden overheads in a business which are not immediately obvious.

However, I am sure someone will assess your business plan carefully so I will wish you good luck.

motorguy

chalkie99 wrote: »

The problem with that is:

a) You cannot alienate the better off customers by making them subsidise those on benefits so you have to give low prices to all.

b) It is a trade, like most others, that is oversubscribed, i.e. there are already too many businesses chasing too few customers. The result of that, in free trade, is that competition forces prices down to a level. I am just wondering if the prices which you think are "OTT" are actually more realistic than you might think as there are usually hidden overheads in a business which are not immediately obvious.

However, I am sure someone will assess your business plan carefully so I will wish you good luck.

+1

Rent / lease, rates, electric, phone, advertising, heating, etc all adds up. I dont think i've seen too many very affluent single seat hair dressers either. Makes me think theres not the margins in it the O/P is expecting.

paulwf

The further points raised by Butterfly and the responses to this demonstrate even more the need for a firm business plan. There are perhaps ways this could work like renting out space in a community centre or going mobile but a viable model has to be thought about in detail as there is no way this is going to work as a conventional salon setup. If you have a meeting without having a plan it won't be very productive.

Butterfly, you need to be realistic and accept that gross profit doesn't equate to net profit, for example there are lots of cafes selling a 20p cup of coffee for £2 that are struggling to pay their bills. When you list all the business overheads the money soon gets swallowed up. You may also be competing against the local college and salons with apprentices, my last haircut with a traineee was £4.

I would also suggest volunteering with some charities cutting the hair of their clients to see what the reality will be. The town I live in has lots of people on benefits and many aren't the nice sort like you that have unfortunately lost their job after years of working and need a break. If they come in to your salon you can forget ever attracting any full fee paying clients!