Self-employment and Entrepreneurship
Are you full of good ideas and like to make things happen, but you don’t know whether starting-up your own business is for you? About nine percent of students in university run a business as a side hustle and two per cent of UK graduates decide to become their own boss directly after graduation, and many more aspire to run their own business in the longer term.
Whether you already have a clear idea and are taking practical steps towards your dream, or you are just starting to consider self-employment, there are a number of considers to think about before deciding if this is an option for you.
Why consider it?
There are many potential benefits of being an entrepreneur or self-employed, including:
- Independence and flexibility - Having the freedom to set your own hours, where and how you work
- Unrestricted earning potential – you aren’t limited to a fixed salary, you can decide what projects you undertake and what you earn
- Job satisfaction - Reaping the rewards of your hard work can be very satisfying, while you also have the autonomy to do the things you love most.
However, you also need to consider some of the risks:
- Responsibility - You're in charge of your pension, National Insurance and completing your self-assessment tax return and nobody is there to manage you or motivate you when things get tough.
- Unpredictable finances and lack of benefits - Your income can be irregular, especially in the early days and you have to factor in that you won't get sick pay, holiday pay or any other employee benefit.
Would it suit me?
You will need a strong product or service to offer. In addition, having the following personal qualities will help:
- Creativity and innovation
- Confidence and energy
- Decisiveness and (calculated) risk-taking
- Communication and networking skills
What are the options?
- Freelancer/consultant - If you have skills, knowledge and experience in a particular field you can charge for your services. Common jobs for freelancing include actors, artists, musicians, photographers, journalists, web designers.
- Sole trader - This type of business is owned and managed by one individual. There's no legal distinction between the owner and the company, meaning that all debts and after-tax profits are personally yours - this is called 'unlimited liability'. Specialist service providers such as plumbers, hairdressers and electricians are often sole traders.
- Partnership - Similar to sole traders in that they are subject to unlimited liability, partnerships involve two or more people pooling their expertise to own and manage the business. Each partner pays tax and National Insurance on their individual profit. Professional service providers such as dentists, doctors and accountants often fall into this category.
- Limited company - Unlike sole traders and partnerships, these businesses are registered at Companies House and have their own legal rights and obligations. Ownership is divided into equal parts called shares. Anybody who owns one or more shares is a shareholder. Limited companies offer limited liability - which means that the business, rather than its owners or managers, are responsible for the debts and profits of the company
- Social enterprise - This type of business exists to benefit society or the environment. The profits are fully or in-part reinvested into the company to help its aim of doing social good. Social enterprises are different from charities in that they aim to fund their mission through trading activities - selling products and services to customers. Charities focus more on gain their funding from grants and donations. Three well-known social enterprises are The Big Issue, the Eden Project and TOMS.
Where can I get further help?
The Enterprise and Entrepreneurship Team at BCU offer advice and support for students and graduates interested in self-employment and starting-up a commercial or social enterprise. We have a range networking events, workshops, start-up programmes and other activities for UK, EU and International students, graduates and staff across the academic year to reach, engage and help participants. Please email to sign up to their newsletter – enterprise@bcu.ac.uk
Looking for further advice, check out the following resources:
