Your guide to starting a business
Exciting, rewarding, daunting - these are all words to describe what it can feel like to start a business. But first, there's one question to ask: where do I start?
Businesses always start with an idea. But ideas come in many different shapes and sizes so you need to figure out what suits you and what you want to achieve.
Are you thinking about turning a hobby into a profession? Perhaps you've discovered how to put a new spin on an old idea? Or do you see a gap in the market that you can fill?
What kind of business are you?
Once you settle on your business idea, you should understand whether you are operating as:
| A SOLE TRADER | gives you full control |
| A COMPANY | limits your legal liability, a little more complex to set up |
| A PARTNERSHIP | two or more people who distribute income and losses |
| A TRUST | a trustee is responsible for business operations |
It's important to decide this early because each business type brings different tax obligations, admin responsibilities and legalities. Most new businesses start out as sole traders and expand from there. If you decide your business requires employees, there are other things to consider. Take a look at the Australian government's website for more info.
Making it official
The government needs to know what kind of business you have, so officially registering it is a crucial step. You'll need to register the following:
- Your business name - read our guide for help naming your business
- An Australian Business Number (ABN) - read our guide for help registering for an ABN
- Goods and Services Tax (GST) - read our guide to learn more about GST
With these important bits applied for, you can look into relevant licenses or permits (such as a liquor license) to make sure your business operates legally.
This is also a good time to register the domain name for your website. Although not mandatory, it's possible to trademark a business name to protect your brand in the future.
Budgeting and finances
Once you've made everything official it's time to start thinking about money. There are all sorts of financial responsibilities involved with starting and running a business, such as:
- Insurance
- Funding
- Budgets
- Pricing of goods and services
To help you figure out how much money you'll need and when you'll need it we recommend reading our how to write a business plan resource. It'll help you work out those all important calculations.
Staying on top of the numbers
When you've done the numbers and have a good sense of what your cashflow needs to be in order to run your business it's important to keep a track of things. Without proper bookkeeping, tax returns can be less accurate, which can put a business in trouble.
We recommend investing in accounting software (surprise surprise) as it'll help take the pressure off when it comes to organising invoices, bills, tax and cashflow.
What's next?
Once you've got the building blocks of your business it's important to do your market research, explore ideas for branding your business and learn more about your customers.
We recommend reading our guide on how to write a business plan to help you organise your thoughts and put a plan into action.
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