SETTING UP YOUR OWN BUSINESS
Starting your own business – sounds so romantic, doesn’t it? Well it is and it isn’t. In this article we’ll take a look at the steps you need to take when starting and setting up your own business.
First things first. You need to be really, really sure that you want to start the business in the first place and that you’re doing it for the right reasons. Starting a business is tough and not everyone is cut out for it. Check out this article that will give you the third degree before taking this grand dream any further.
Still with me? Good stuff. Now that you’re confident starting a business is the right move for you the next step is to do some planning. A great quote comes to mind attributed to Dwight Eisenhower:
I have always found that plans are useless, but planning is indispensable.
This is definitely something that we agree with here at Generate. It’s the process, not necessarily the result, of planning that is so valuable especially when you’re in the early days of your new business. You can read all about writing business plans in our eBook here. If you prefer to start lean and want a quick and easy business plan, you could do worse than our one-page template which you can grab here and there are instructions on how to complete it here.
Now that you’ve got your plans all sorted out it’s time to take action and get things set up! What follows is an overview of the steps you’ll need to take to set everything up. This is aimed at those starting a company, but if you’re heading down the sole trader route it’s mostly the same, you’ll just skip step 3.
- Appoint a tax accountant and a lawyer. Ask around for referrals and make sure to get ones that are familiar with your industry. Feel free to interview a few different options so you can be sure you’re going to work well with your chosen advisers.
- Make sure your chosen business name is available. You don’t want to spend time and money only to find out 6 months in that you’ve breached somebody’s trademark. Best bet is to perform searches with ASIC, the ABR as well as the trademarks register.
- Setup your company. You can do this on the cheap via one of the various online services, Veromo comes to mind, or you could ask your accountant or lawyer to help you out. They’ll charge a little more, but you’ll get advice around who should be the owners (shareholders) and directors and they’ll help you with the rest of the steps here. Money spent upfront is rarely wasted.
- Get registered with the ATO for your company Tax File Number (TFN), Australian Business Number (ABN) as well as GST if you’re going to be turning over more than $75,000 and PAYGW if you’re going to be employing anyone (which if you have a company you’ll have at least one employee – yourself!).
- Open a company bank account. Best bet is to get two – one for transactions and one for savings. It’s a wise move to move a small amount of every invoice deposited into your account (say 30%) into the savings account so that when it comes time to pay the BAS or tax, you’ve got some money ready to go. Try and get low fees and avoid credit cards where possible.
- Get insured. Speak with an insurance broker that understands small business and can help you get all the cover you need. You’ll likely need to consider workers compensation, public liability, professional indemnity, motor vehicle and more. Get the right advice upfront and don’t risk being caught out.
- Setup your accounting system. You can find more info about this here. Best choose a cloud-based platform and one that your accountant is familiar with. You may choose to do the bookkeeping yourself, but it’s usually wisest to outsource this to a good bookkeeper. Ask your accountant for a referral. If you choose to DIY get yourself some training before getting started.
- Create your invoice template in the software. This is quite straightforward and you’ll find instructions in your chosen software.
- Get a services agreement drafted by your lawyer (or find a suitable template online). A services agreement outlines what services you’ll provide for your customers and what happens if they don’t pay on time. You can find more information here.
With all of this done you should be off to the races! It’s time to start marketing your new business, crafting your business processes, hiring staff, delivering product to clients and learning to live without any spare time for the forseeable future!
If you want more information on starting your own business you can grab our eBook here, but if you want to talk to a real person about your plans why not drop us a line? We work with businesses at all stages of their life and we love helping entrepreneurs realise their business dreams.