How To Start A New Business in Australia

How To Start A New Business in Australia

If you want to learn how to start a new business, you will find that it is a very rewarding and satisfying process that gives you opportunities for a work-life balance while you are pursuing something you are passionate about.

Many entrepreneurs who desire to start a small business don’t always have the knowledge needed to get their new venture off the ground and running in the right direction.

There is much to consider when beginning a new business, from developing your products to how to market them and from technology issues to finance.

If you can get the basics of starting a business done right the first time such as the basic business registrations and get the right systems in place, you will be prepared for success in business and this leads to performance enhancements.

Here is a checklist of some basic things that you will need to do to start a new business and prepare you for success.

Starting A New Business
Speak to a qualified accountant about meeting your tax obligations and other important details in your new business.

1. Start with your business structure.

Do you wish to run your business as a sole trader or partnership, a trust or a company? Each of these structures has advantages and disadvantages and also come with their own specific tax reporting requirements, work health and safety issues as well as regulatory essentials.

You should speak with an accountant or lawyer before deciding which structure is best for your current situation.

2. How will you fund your new business?

If you need funds you should speak with your accountant about the advantages and disadvantages of the options open to you, such as banks, personal savings, personal loans or venture capital, or many other funding options and sources available.

3. Choose a business name and register it.

When you choose a business name ensure that you can register your company name before you have any letterhead, logos, websites, business cards, or purchase a URL.

Will your company name be accepted by the Australian Securities and Investments Commission (ASIC)? Make sure that it is available for use and begin the process at ASIC Connect.

4. Should you register a trademark for your business name or logo?

If you think you need to protect your business name or logo you should inquire about copyright protection. To understand about intellectual property rights, visit IP Australia.

5. Apply to get an ABN

If your business will be registered to collect GST (have an annual turnover of $75,000 or greater), then you will most definitely need an Australian Business Number or (ABN).

In order to apply for this, you will need to visit the Australian Business Register. If you plan on forming a partnership, company or trust, these will need their own Tax File Number or (TFN) given by the Australian Tax Office (ATO) as well.

6. Get familiar with PAYG withholding.

If you are going to have employees, their salaries will need to have taxable amounts withheld from their pay checks. If you have contractors these payments must also receive similar treatments.

Speak to a qualified accountant about meeting your tax obligations in your new business.

7. Get all the needed permits and licenses.

You should visit business.gov.au to learn about any state, local or national licenses you may be required to have for your new business.

Also, check into the ATO’s fuel scheme to learn whether your business can take the fuel tax credit.

8. Have an Australian business account.

You will need one place where you can take care of all your related business needs such as government regulated permits, registrations and licenses and the rare but welcomed partnership between state, national and local governments. Having an Australian Business Account can save you a lot of time and effort. Speak to a business tax accountant who will be able to assist your business at this step.

9. Have an understanding of your legal requirements.

There are certain laws that will apply to certain businesses, services, and products. A small business owner that is interested in finding out their legal obligations can find this information in the Australian Government Department of Industry.

Knowing about Australian Consumer Law, privacy laws and the Competition and Consumer Act will help you to understand your obligations at the basic level.

10. Get your accounting systems ready.

It does not matter how you get it done, an accounting system that is set up right the first time with business growth built into the system will save you tremendous effort over time. All types of businesses have legal and tax responsibilities involving record keeping.

Equity Or Debt: Which Finance Works The Best For You?

Equity Or Debt: Which Finance Works The Best For You?

Do you want to start a new business or are you looking to expand the one you have already established? You need finance to do either.

Coming up with options for funding your business can take up a significant chunk of your time. To kick start a new business or to light a fire under your existing one, your first option is equity or debt finance.

Zeroing down on finance option that works the best for you is a tough task and you must ensure that you have dug up the last available details about these options.

Here’s a low down of things you must consider while weighing your options of finance:

How much cash do you need?

A great starting point is to know, loud and clear, how much capital it is that you need. Start by adding up the following costs:

-Inventory
-Equipment and installation
-Lease
-Employee wages (including benefits like superannuation)
-Legal and administrative costs.

Now take this number and compare it to the amount of cash your company has on hand, to arrive at the exact amount you will need to borrow. Remember that the more the higher your debt, the lower will be your control on your own business. To ease some financial pressure, you may consider pumping up your savings, or even continuing with your day job to ensure that income keeps coming in.

Don’t forget to look at grants from the government. Federal, state, and even local governments sometimes offer funding for new businesses.

Finance
To ease some financial pressure, you may consider pumping up your savings.

Debt Finance

The most mainstream type of finance, you borrow money, and agree to pay it back within a time frame with the accrued interest. Examples of debt finance include

-Loans from banks
-Credit cards
-Mortgages
-Overdrafts
-Leasing, hiring, or purchasing equipment

Why debt finance may be good

One, you are not answerable to any investors so you retain control over your assets and your business. Two, your business’s profit is yours to use as you like. Three, interest accrued on business loans may sometimes be tax deductible- ask your accountant about this.

Challenges with debt finance

– Banks ask for financial records, projections, and business plans before approving debt finance. This may be hard for new businesses to put together.
– Interest payments and fees need to be repaid. So, your business must be able to generate cash with the invested capital.
– Interest repayments may eat into your cash-flow.
– Any assets signed on as collateral or security for the loan may be repossessed by the bank if you fail to make repayments.

Equity Finance

This means investing your own or other people’s money into your business. The investors become part owners of your business and need to be paid profit.

Sources of equity capital:

-Friends and family
– Angel investors: individuals investing private funds (usually less than $2 million) into startups.
– Crowdfunding: several people come together to donate to a business.
– Public float: issuing securities like shares to people.
– Venture capitalists: pro investors who put money (usually between $2 million and $10 million) into companies.

Why equity finance is good?

You don’t have to make periodic repayments on interest.

Things to consider about equity finance:

– If your investors are family and friends, your personal relationships with them may be affected.
– You may face competition from similar businesses in attracting an investor.
– You share profits with your investors and they may want to have a say in business matters.

Tips For Small Business Owners

Tips For Small Business Owners

These tips for small business owners can help you to control your own destiny, be your own boss and ultimately be successful and profitable.

Have a Vision and Business Plan

Having a clear vision of what you are trying to achieve can help your business to succeed, by keeping it moving in the right direction. A simple yet clear business plan also helps and should include everything relevant, such as your goals and strategies, marketplace and any competitors, your budget and expected earnings, and any weaknesses or strengths. As your business changes or grows, you should adjust the information in the plan, but it remains one of the most important resources for any small business owner. A business consultant can prepare a plan for you or you can download the template online.

Education

You need to be able to effectively keep up with the constantly changing business environment, rather than simply hoping that everything just falls into place. The SME Business Learning Forum is one recommended course offered by Connecting Southern Gold Coast, along with the SBAA, although there are plenty of other useful and informative online classes from which to choose.

Compliance

You don’t want to have to pay penalties or fines, or even worse have your business close down, and making sure you are compliant with the law is a must. Knowing the latest regulations on health and safety and other important aspects of running a business is a lot easier when you attend one of the short courses regularly offered.

Tips For Small Business Owners
Create a remarkable marketing strategy to achieve a maximum profit and a sustainable business.

Sales and Customer Service

Understanding your target market and knowing how to attract customers and make sales are essential, regardless of the size of your business. Keep up with trends in marketing and retail, and invest sensibly, focusing on your determined target market. Customers also expect the best service and top quality products and you can set yourself apart from the competition by offering the best possible service and products.

Staff and Industrial Relations

You can expect more productivity and better customer service from employees who are treated well and feel appreciated and valued. Increasing sales and lowering costs are two things you are probably concerned with, and both of these things are directly related to the performance of your employees.

Whether you are an experienced marketer, or a new business owner, it’s crucial that you understand how to get your business seen by new people. I hope the above tips will be valuable in helping you become a successful businessman.