RICS APC Lifeline - Mandatory Competency - Business Planning
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With introductions over, let’s dive right in. It seems sensible to start at the beginning so in this post we’ll be looking at the logistics of setting up in practice and the key decisions and considerations you would need to make along the way.
Why is this relevant?
This is a common theme of questioning within the RICS APC, particularly in relation to mandatory competence; conduct rules, ethics and professional practice. It’s also important to understand the business in which you work, plus you may want to work for yourself in the future.
In this article, we will take a top-level look at what you need to do for your RICS APC, covering business planning, RICS requirements and legislation. Future posts in this series will focus on the key considerations in further detail.
Firstly, you need to establish whether there is market demand for your service. Detailed market research will reveal whether there is a gap in the market or whether you could create a new market. Looking at the competition is important to work out things you like, things you don’t and how you could do things better. Ask yourself; what problem are you solving and why does your solution makes your business unique?
You need to decide how to efficiently structure your business depending on your objectives and ownership structure. Common structures include being a sole trader, limited liability partnership (LLP) or limited company. How will your fund your venture and will you require external sources of finance, e.g. bank or venture capital?
This will form the basis of your business plan. You will also need to think about branding, marketing and forecasting cash flows.
Being a RICS regulated firm demonstrates to clients that you are at the top of your game; ethical, trustworthy and transparent. It is the gold standard within the property industry and most clients will expect that their advisors are regulated firms. To benefit from being regulated, you would need to submit a firm details form to the RICS. There is no cost to doing so.
After you become regulated, you must comply with the RICS Rules of Conduct for Firms. These include a number of mandatory requirements such as:
- Having adequate Professional Indemnity Insurance (PII)
- Complying with regulations for holding clients’ money
- Having a written complaints handling procedure
- Ensuring that your staff receive adequate training to enable them to act competently
You also need to consider various statutory requirements:
- Business Names Act 1985
- Companies Act 1985
- Data Protection Act 1998
- Money Laundering Regulations 2003
- Consumer Credit Act 1974 (for certain activities)
- Financial Services and Marketing Act 2000 (for certain activities)
If you intend to employ staff, then you will also need to consider relevant employment legislation.
Setting up a new business can be a minefield of red tape with an endless ‘to do list’ to get you to day 1 of trading. However, it is also a highly rewarding process which helps you to turn your passion and dream into a solid reality. Having an appreciation of the process is essential for the APC, but it will also stand you in good stead to become a better property professional in the future.
Want to know more?
- Check out the RICS website for the official RICS APC guidance, help sheets and further information
- Ask us any questions you have
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Stay tuned for our next blog post to help build a better you
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