To start a small business is most likely a labour of love. Some times it is turning a hobby or passion into a business. Unfortunately in some cases, some decisions are made with the heart rather than the head. Poor planning or operational decisions made for the wrong reasons can easily see a business end all too quickly.
Now we certainly do not want to talk you out of this amazing journey as many successful millionaires grew from a small business. The most important thing you can do here is plan well, understand the effect it will have on you and your family, and understand the implications if it does not work. This guide will give you a process to work through to maximise your chance of success.
There are more than two million small businesses in Australia, most with a turnover of less than $10 million per year and less than 20 staff.
WHAT is important to consider before you start a small business?
Here at Small Business answers, we want to bring you the best-unbiased advice and in this case, one of the best resources on this subject is available from the Federal Government website.
The basic steps of starting a business:
- Consider if you are really ready
Small business owner
- Evaluate your business idea
- Build a business plan
- Choose how you want your business structured
Type of businesses, limited liability
- Check your government/legal obligations
- Consider what support will you need from others
- Figure out your finances
- Promote your business
As part of your research you should visit https://www.business.gov.au/guide/starting. Here you will find information to guide you such as, are you ready, making decisions, planning, etc. You can even find information here on government grants, events, and training that may help you get started.
A checklist is also available that will guide you through the most important factors you need to consider. This includes checking your rationale for starting the business, determining the right business structure, tax implications, and insurance. There are tick boxes for you to check off and in the long run, will put you in a much better and safer position. https://www.business.gov.au/Planning/Business-plans/Starting-a-business-Checklist
Be sure to read our essential guides on business structure, tax, GST, record keeping, marketing, building a website, insurance, or just explore our many guides designed to make your decision-making easier.
HOW do you write a business plan
Starting a business is so much more than a good idea and a business plan is a document that makes you go through the entire process including financials. In many cases, a business plan will be required by a bank or investors or maybe even your partner to justify supporting you in this new endeavour.
A business plan will normally include the following:
- A summary of what your business will do
- Where will it be located
- If it will employ staff, what will that structure look like?
- What products and services will you offer, where and for how much?
- How will you manage risk including insurances?
- Are there legal considerations?
- What do you need to buy in the way of fixed equipment like a computer or inventory to sell or make something?
- What hours will you be open and how will you collect payment?
- How big is the market potential and do you have competitors?
- Who is your customer and where are they?
- A list of Strengths, Weaknesses, Opportunities, and Threats of your business (SWOT).
- What is your Sales and Marketing Strategy?
- What is your vision and what objectives need to be met to get there?
- How much money do you need to start your business?
- How much revenue do you believe you can make?
- Will you make a profit or a loss?
- At what point you will actually pay yourself
- When do you plan to break even?
- What information have you used to back up these other questions?
It all sounds a bit daunting! But if you work through these points, rather than starting a business on a gut reaction, you will have a much clearer picture. Downloading the government guides really do make the whole process that much easier. Business plan guide and business plan template available from https://www.business.gov.au/planning/business-plans/how-to-develop-your-business-plan
Another great place to consider learning more is via a TAFE course where you will benefit from a face-to-face discussion on the subject.
The great feature of the Small Business Answers website is we are pulling together the most frequently asked questions in starting or running a small business. Please continue to visit this site as we continually update with new information to help you succeed.
SUMMARY – Start a Small Business templates and checklists
Make sure you a ready to start a small business and have done your homework on the opportunity. Use some of the fantastic templates and checklists available from the government to help you build out a business plan.