In this article, I will explain the proven steps that I recommend to anyone that is interested in starting a small business in Australia.
Before you get started with your small business. you’ve got to make sure you have a concept. You want to make sure that you know what sort of business you want to get into. Some people get really tied up into doing all this crazy detailed business planning. I find a full-on documented business plan is only really important if you need finance or you need to get money. That’s really the only time you need a fully documented process.
It’s great to have cash flow forecasts, and it’s great to have plans, however typically in business it is very rare that everything will go to plan. Especially if you don’t have historical data. So the planning step, I would honestly not spend too much time on it. I’d focus on doing what you need to do to quickly get to market and get selling.
You also need to know what you are really good at. Just analyze yourself, are you good at admin work, you might be great at selling, or you might be great at building things. Whatever you are great at, ensure that you identify your weaknesses so you know them. Be wary of it you are not gonna be great at everything.
The truth is, in business you’ve only got two resources and that is either time or money. It is very rare that you will have both. Probably towards the finish line, you’ll get there however you know it’s the payment of business. Do you know what you want out of the business financially, and what are you in for?
Is this meant to be just a hobby, or is it meant to be just a replacement to a full-time job or you looking to scale and get massive? The answers to these will affect what happens in the startup phase.
I strongly recommend that you also start searching for an appropriate business name and checking for domain names, and that they are available. Down the track, you also need your social media profiles as well. Just make sure that nothing is taken, as you don’t want to go fully into an idea and then realize later on that it is limiting you.
What you also need to do is choose your business structure and type. That’s really important when starting a small business in Australia. If you’re staying really small and something you’re testing out, you might start as a sole trader. As a sole trader, the business is basically your name and you are claiming and trading under your personal income.
However, as a sole trader you’ve got no protection, and it’s fully liable on you. So if anything goes wrong, when you commit to anything over 100 percent, you will be liable.
It’s a great way to start out as a sole trader, just to see if the concept was going to work and then we slowly built up into a company, and then perhaps even a trust, which we’ll talk about later.
So companies are the most common form of business in Australia. The reason being, is it offers some protection and the money you put into the company as a director you get back. You do have responsibilities as a director of a company as well, so you need to know what you can and can’t do, as you can be prosecuted if something goes wrong.
On top of that, you have a trust structure as well. Some people have a trust, just for asset protection, however my recommendation is just to know how big you want to get. If you’re starting small or you’re going to be at sole trader level, then it isn’t worth doing. You can just stay as a small business in Australia without all that company hassle.
If you think going to get big, then get that company level you’re gonna go or if you think you need asset protection speak to an accountant first, before settling on a company or a trust. There’s a lot more costs involved in a trust or company, so maintaining it you’re looking at if you go just maintenance with your accounting bills, legals and processes and stuff.
The next thing you’ll need to do, is you need to get an ABN number. Just google it through the ABR you need to get that ABN number, to get trading. Please always double check as a sole trader, exactly what you need in that regard. Double check online, because those rules are constantly changing and you know check if you need to.
You can’t trade as a small business in Australia without an ABN. You will need that if you’re looking at a company or a structure, or a percent as a sort of trader. You need an ABN to also start bank accounts later on.
You also need to speak to an accountant as well, to get started and set up your accounting structure and choose the right accounting software, and put it all in place. The key element here is to actually know what accounts you want to have, because how you set up your accounts now can really help for your reporting later. You can quickly look at your books and know where your income is coming from, and where your expenses are going out.
Once that’s all done, the next step is to register your business name or trademark. If you need it, a lot of people get really gung-ho on the trademark sort of aspect of it, from what I’ve seen in the past, especially in small business.
To be honest, trademarks do not offer that great of protection with internet stuff coming out. Information is moving so rapidly you know even if you do have a trademark, you may get to a point where you’ll be able to sue or you know get your money.
It is up to you if you do want the legal protection, however you know from what I’ve seen, for the typical small business in Australia, it’s basically worthless – it’s the work that goes into it that makes the name worth something.
While you’re thinking about your website and digital stuff, you should also get your SEO sorted, and social media campaigns underway. Eventually, you will want to do social media marketing more than likely and maybe appoint an agency to run it for you.