Nothing beats the feeling of hitting “Go!” on your own business. But business coach Kerry Zarb (above) says clients often come to her after they’ve already launched, and she’ll go back with them to tick the boxes of planning, registering and record-keeping to avoid later stumbles. “My biggest advice to first-time business owners is to understand the action lies with you,” says Kerry, who is based in Melbourne and hosts the podcast The Money Barista. “Lean on as much free information as you can but keep your eyes open. Your life is about to change.” She reveals the answers to all the questions you have on how to start a small business.
How Can I Test Whether My Idea for a Small Business Is Feasible?
This is about doing your research. If your product already exists in the market, who’s delivering it? What service are they providing behind it? How is it getting to the customer? What gives them a point of difference? And reach out to others; it could be [as simple as] posts on local business Facebook groups: “I've got this idea for X. What does everybody think?”
When Do I Write the Business Plan and What Should Be in It?
At the beginning. You’ve had your idea, you’ve done your research. Your business plan is going to bring all the pieces of the puzzle together. You see what you want your business to be, your investment strategies and financial commitments, and who’s on the team. You do your SWOT analysis. I recommend business.gov.au, which gives you the free business plan template and explains how to use it. It’s also important to ask yourself why you want to start your business: Are you looking just to make money or interested in a change of lifestyle? Do you want more financial freedom? Or time freedom?
SEE ALSO: Ask an Expert: How to Write an Effective Business Plan
How Do I Choose a Business Structure?
This is a good time to seek advice from an accountant and/or a financial planner. There are four key business structures in Australia – sole trader, company structure, trust and partnership – and different areas of liability fall within those. A sole trader can be a little [more] exposed when it comes to indemnity insurance and protecting yourself and assets. But if you grow, you move into a company structure, which shouldn’t be feared.
How Do I Get an ABN?
You can’t do anything in your business without ABN registration, a free Australian business number you apply for online that normally comes through quickly. You will need to provide the date your ABN is required, which should be before you start any business activities, such as purchasing stock.
Hot Tip: You are only entitled to an ABN while you are running an enterprise; the government may check occasionally to ensure this is still the case.
What Should I Be Wary of When Starting a Business?
The biggest underestimated factor is your personal life. Starting a small business doesn’t work for everyone. Often people think, “I can work for myself”, but what if you’re working from home and you have small children? What if your extended family means you have lots of social engagements? Consider whether your family is on board.
SEE ALSO: Small Business Success Stories With Pig & Pilgrim
Do I Need Office Space?
Since COVID-19, people are all for technologies like Zoom. You could set up a home office, do video consults and sell a service in your pyjama bottoms and a nice top. But if you want to elevate your professional presence and people are regularly visiting, you need that office environment. Some people also need it to focus and be productive.
Do I Need Legal Representation?
It may be required if you’re going into a partnership or, if you’re a B2B offering a service, you might engage someone to help you with contracts. It’s certainly a good idea to know where it’s available should you ever need it.
Do I Need Insurance at the Start?
Insurance is a must. The Australian Government Business website explains the different types of insurance a business can have and which ones are compulsory. It also recommends you get detailed advice relevant to your particular type of business from a licenced insurance broker, business advisor or insurer.
How Do I Get a Website?
There are many platforms that make it easy to set up in the ecommerce space: Shopify, eBay, Facebook Marketplace and Etsy. If you’re a service-based business, you can go to GoDaddy or Squarespace to DIY your website. Another option is to find a web developer on Airtasker or Fiverr, but keep in mind cheapest doesn’t equal best.
Once live, it is good practice to maintain your website. The simplest way is to attach a blog (for a more casual business, such as a cafe) or a ‘News’ section (for a more professional enterprise, such as an accountancy firm), even if it’s just for posting a short article within your area of expertise once a month. Having one easy-to-update section of your website allows you to engage regularly with your customers, which can build your ranking as there are more frequent visits to your website. It can also boost SEO by giving you a place to add in more keywords, also resulting in more exposure for your brand.
SEE ALSO: DIY Website Checklist: How to Create Your Own Website
What About Social Media?
I recommend getting your social media accounts at the same time as your domain name. It’s important for brand consistency to secure all those handles so you are identifiable in every space that you live online. Don’t copy content across all platforms, because social media algorithms detect copied content and de-rank [decrease] its visibility. Also, your audience will notice. My tip is to not spend a cent on advertising until you’ve tested whether you’ve got engagement with your social media and all your brand elements – colours, logo and key components of your business.
What Records Do I Need for Tax?
For any expense over $82.50, including GST, you must have a receipt or tax invoice and a copy of every invoice to ensure you’re complying with the Australian Tax Office. Make sure you’re keeping your records too for the correct amount of time.
SEE ALSO: Tax Return Tips to Get the Most Out of Your Return in 2023
How Soon Should My Business Make a Profit?
It’s common not to make a profit in the first 12 months, or even two years. But if there’s a real gap in the market and your messaging reaches your target audience, you can do well quickly.
When Can I Quit My Day Job?
It comes down to your personal circumstances and financial position but transitioning is the best way to go. I encourage everyone to start a business as a side hustle because you can test, measure and watch your business evolve and see if it’s viable. I was a full-time employee and saved annual leave so I could use it in the final stages before I hit the button and said, “That’s it. I’m no longer an employee.”
This is general information only and does not constitute financial or legal advice. Other requirements under the law apply. Seek professional financial and/or legal advice to determine the right outcomes for your business.
This article was originally published in 2021 and has been updated.
