To think opening your own business isn't as plain sailing as dp is hoping.

[MarmiteAndCheeseRolls]

So.
Dp is mega enthusiastic about opening his own business in a field he's had lots of years doing and has all qualifications and general equipment. The loan would be for the ground rent and some large equipment
He's now saying about looking at a business loan.. Of 100k.
It terrifies me.
He does honestly know what he's talking about but I honestly think he don't realise it's not just set hours. It will be much more and would be bringing the work home with him and stressing himself out.

I'd love for it to work for him. However I think its a huge risk.

I feel IABU putting a ' downer on it' but I'm a worrier.

Toilet paper, soap. Website rent? IT platform. Phone / fax / stuff from DVLA for MOT’s etc?

Isn’t there an IT system that most garages use that tel you times for search car’s service and certain jobs etc? I imagine that is not cheap?

I don't know how it works in the UK, but here in the US a friend just started up a business and the electricity company wanted a $15k deposit before they would put in a connection.

Maybe worth checking.

Advertising costs - find out how much they will be. Things like Google Ads you can end up spending a LOT of money on to bring in business, especially early on.

Could he start out as mobile? With a van? Pop up gazebo to work under? That'd cut out a lot of basic expenses such as rental, rates, electricity etc etc. and would establish the business and hopefully earn enough money before getting premises and expanding such that he has the basic costs covered and an active customer base he can expand from before moving into premises? Admittedly he'd perhaps have to reduce the range of services he can offer eg if it's a motor repair business, eg he'd not be able to offer MOTs but could offer pre-MOT checks for example.

LOLER compliance examinations for the ramps
Servicing of equipment
Safety plans - will he be employing more than 5 people?
Pensions for employees
Sickness cover
H&S training for your DH - does he actually know what he's doing? No disrespect, but most people claim its common sense, then it transpires they don't know the chemical they've been using extensively for a decade is a known carcinogen and they've been exposed to it daily when a pair of gloves and a mask could have protected them: www.hse.gov.uk/mvr/index.htm

Also...when is he going to have the time to do
Insurance
Set up payroll
Do the accounts
Do the payrun
Do the processes and procedures
Do the invoicing
Chase payments
Repair and maintenance of equipment
Quotes and chase potential customers
Do the mandatory paperwork

A friend set himself up doing MOTs a few years ago and has done pretty well out of it, so it certainly can be done.

It took me 8 very long years to even make a profit but it was worth it in the end

He will need a prfessional accountant, someone to create the website and do advertising, before he starts he will need to fork out for market analysis (no point in opening up in a saturated market) and pote tally a business plan (if he can't do it himself). He will also need a lawyer to draft customer contracts and employment contracts (if he employs others), if he is sued or threatened with legal action again he will need a lawyer. If he does manage to secure a loan make sure that he does it as a limited company and not as an individual (this will protect him and his assets in the event that the bus ess goes bust provided that he doesn't commit fraud/wrongful trading).

Corporation tax
Employers NI contributions as well as his own
Company phone number and line/mobile
Said above, but insurance is critical (3rd party, liability, health/loss of earnings)
Pension

Self employed or sole trader isn't a great idea, needs to set up a limited company otherwise his personal assets (e.g. your house!) are at risk.

My DH is self employed, he's never had a loan though. He started off doing some work for people after his workplace closed down. He's in automation / electrical engineering.

Then over time got an industrial unit for storage, it is £500 a month - but saved some first and then pays for it from his costs. I would have felt worried about a loan as we have a mortgage as well. It is stressful enough without that.

Could he start off small and build up a bit? Also, you can get some thing on the computer to help with accounts, run by the bank, it has saved some of the money he used to spend on an accountant.

So, I think start small, build up

yes limited company might be better,

Although I suppose it depends what he is doing..

.

Pension contributions now too if he's planning on having staff.
MOT registration
Training Courses
Payroll software subscription (may be cheaper to pay someone else, accountants usually have a payroll service too)

Has he met with an accountant to discuss it?

Is he buying an existing business
or starting from scratch?
(please say the former)

A book keeping course and a health and safety course ( to the level required) would be a start before he takes the plunge because he won’t have time after.
Chat/advice re tax with a qualified accountant with experience in the industry so he can set up a limited company in advance. Tax and VAT are usually the reason why most new businesses fail.
Read up on all areas of employment law and consumer law. Employing staff is a minefield. Once he’s done his homework he may change his mind!
Oh and a good filing system for paperwork. Never throw anything away because you will need it when you ultimately sell the business or when HMRC decide to do a tax investigation. Which leads on to the need of a home office.

What area are you on OP?
I would definitely suggest a business start up support company. They usually give free advise to new startups along with help getting loads etc. They will help go through a business plan and let you know what costs you are looking at etc

Found myself in the same position a few months ago, DH wanted to open a business. He has the knowledge in his field and is such a Hard worker, he wanted me to help run it. We are both grafters but just the thought that it could go wrong and we could be left with nothing was terrifying. We didn’t go ahead in the end, I wish I could say we will consider it again but I feel we would have too much to lose if it went wrong.

Oh and GDPR training & data protection registration.

First Aid... risk assessments for each task, risk assessments for each potential client group, risk assessments for each location...

Reasonable measures documented for each risk...

PPE...

Sorry - did this myself and in the first year of business, we realised just how much 'non-work' work we were doing...the list was endless.

Does he have potential customers already? Cash flow is everything with new businesses.

He only needs written risk assessments if he has 5 employees or more.
He does need COSHH assessments though.

Speaking as an accountant and business advisor
the level of scare mongering on this thread is a cracker

FFS
hire a good accountancy firm and pay them to do all that carp

but make the business sound first

Don't do a downer on him, ask some pertinent questions such as:

how many years would he have paid off this debt (according to his business plan)?

How much turnover would he be expected to make to make enough profit to pay himself a salary?

Etc.