Welcome to our recommendations for setting up your business. This is a step by step guide to assist you can use to assess if you are ready to turn your hobby into a successful business.
PREPARE
Research
Operating a business comes with a range of responsibilities. Are you ready for a change in lifestyle, a change from comfortable routines, or change in income? Think carefully about these, and assess if you will get the satisfaction you hope for?
Prepare yourself ahead of time so that you are not overwhelmed when the business takes off. All the best!
Are you ready for a little bit of homework? Have you assessed your business idea to see if there is a viable market for your product or service? Have you considered your business location or how you will sell to your customers? Well, now is the time to compare your expectations with the reality of your competitors.
Decide
Plan
Now that you have a bit more information about your product or service from the marketplace, it is time to make the crucial decision. Should you maintain status quo, or do you turn your business into a hobby? Be honest and realistic during this process to avoid future financial loss.
Write up a Business Plan to ensure you understand your business objectives (why are you in business), strategies (how will you remain in business), marketing plan (how to get and keep customers) and financial forecasts (what are your outgoing and incoming finances).
As part of your Business Plan conduct a SWOT Analysis, to help you decide whether to proceed with setting up your business.
Register
Before you officially register your business, you need to consider the structure that best suits your business – sole trader, partnership, company or trust.
For Australian business structures and their implications visit www.ato.gov.au
As a minimum legal requirement, most businesses will need to apply for the following:
- Australian Business Number
- register a business name
- Tax File Number
All businesses need a Tax File Number, this can be the same for a sole trader, however other business structures need a separate one for the business. Take note of which taxes you need to register for.
If your expected turnover is $75 000 or more, you need to register for GST. Keep the right records and seek advice from a registered Tax Agent when lodging tax.
Applying for any registration required by the ATO is free, however, your accountant may charge a fee to assist with this arduous process.
Compliance
Be aware of the local, state and Australian government laws that may affect your business. These include licences, permits and regulations, codes of practice and policies. To find out licenses that are unique to your business activity or location, such as disposal of trade waste, storing and preparing food, or running a business from home – use the free online Business License Finder.
Some businesses, even when operating from home will require an operating license or permit issued by your local council.
Finance
Prepare your finances adequately. Businesses fail because of lack of financial planning. Use latest digital tools to organise your records. Keep a close look on your prices of goods or services and revise when necessary. Look out for grants and financial assistance from the government. Consult with a professional Business Analyst to discuss the viability of your business and map out a financial plan to keep your business afloat.
PRotect
Based on your business type, activities and industry you must determine what type of insurance you may need. Insurance is complex so make sure you research and understand the fine print, specifically to ensure your will be covered sufficiently. Be patient with the insurance broker and provide as much detail as possible so that you are insured adequately.
Buy & Sell
Now that you have set up business, it is time to make money. If you are buying and selling products, take time to understand your suppliers and search for quality products. If you are intending to import and export products, familiarize yourself with Australian customs and quarantine regulations. Also check the freight and customs processing times to avoid delays.
Refer to your marketing plan and build your customer base. Advertising and selling are a snippet of running a successful business, now you need to tell people about your business. This is your opportunity to convince customers why they should come to you for your products or services?
You may have heard of the adage; “customer is key”, yes that’s true. You will need extra customer service skills to maintain customer satisfaction and loyalty. Grow your business, diversify your products or service, employ workers if need be, collaborate with other business owners and make money.
Keep learning
The trick to running a business successfully is acquiring knowledge, you do not stop learning. Read industry publications, attend training workshops and other networking events to keep up with the business trends. Surround yourself with trusted and reliable professionals who can help you grow your business.
Starting a business is easy, but keeping it successful is yet another challenge that will require you to consult with your Business Development specialist.
