the first steps when starting your own business…..
It all begins with an idea. Maybe you want to launch a business. Maybe you want to turn a hobby into something more. Taking those first steps to launch a business can be daunting, where do you start?
These steps keep the sole trader business structure in mind, but you could apply some of this info to other structures.
The Legal “Stuff”
Government
To operate any business structure in Australia you must have an ABN (Australian Business Number) and a TFN (Tax File Number). The good news about the sole trader structure is you already have the TFN because the business uses your personal TFN. You just need to apply for the ABN. An application can be made through the Australian Business Register.
Top Tip
You should never be paying for an ABN, if the site you are on is asking for payment and doesn’t end with .gov.au you're on the wrong site!
Once you have registered an ABN you can then apply to have a “Business Name” linked to your ABN. You don’t need to create a business name if you are going to be sending invoices “From Your Legal Name” but if you want to have fun and get creative with a business name, it needs to be registered. A business name application is handled by ASIC. Before starting the business name registration process you should search ASIC to make sure your business name isn’t taken. ASIC will also show you what businesses have similar names to yours. If you find there are a lot of business names like yours it might be worth considering another option, especially if the name you are thinking of using identifies with a particular industry. Currently a business name costs $42 per year or $98 for 3 years.
Top Tip
When your business name is due for renewal you will be guaranteed to receive correspondence from companies that are not ASIC charging business name renewal. Do not pay for this! The only renewal you need to pay is to ASIC. Check that the site you are paying for has the .gov.au address.
Banking
As a sole trader legally, there are no requirements to set up a business bank account but practically it makes sense to keep your biz money separate from your personal. The easiest option is to go with who you are already banking with because your identity is already verified. But if you aren’t happy with your current bank now is a good time to make the switch.
If you are going to need to accept card payments there are options like using Square (you can even get a card reader), Stripe or Go Cardless. Look for what can integrate with your website and accounting software.
Top Tip
Set up a business savings account to set aside money for tax savings or future equipment investments.
insurance
Like with having a business bank account there is no “rule” you must have business insurance, but if something does go wrong in a sole trader business you can be personally sued. This is where public and professional indemnity insurance can help protect you. If you have employees, you should also have workers compensation insurance (this is a legal must).
The Business “Stuff”
Domains & Websites
After you have locked in the business name, you can buy a domain. That will allow you to build a website and have an email like name@yourbusinessname.com.au, if you want the email address to be @yourbusniess name you need a domain. This is a list of Government accredited domain sellers.
At this point in your business if you don’t have the money or care about website, it is worth thinking about your long-term business goals. If you see yourself in the future wanting a website it would be worth securing the domain for the future benefit of your business.
Business Email
The last thing you are going to want once your business is up and running is to have business emails getting lost in your personal inbox. Gmail and Microsoft 365 are both good options for business email providers. Both can link into your website and your domain name.
The Accounting “stuff”
accounting software
I will always recommend Xero because it’s a product I have been using for nearly 12 years! It’s user friendly and integrates with many apps like Dubsado, Kajabi and Halaxy to name a few. Using accounting software linked to a business bank account helps reduce the risk of forgetting to declare income or expenses that are tax deductions.
At Indigo Business & Accounting services we offer the complete package to set up Xero and train you how to use it properly. If this is something you’re interested in hit this link.
Find an Accountant and Bookkeeper
If you’re in the early days of your business, it might feel too soon to engage with an accountant or bookkeeper. But I have seen many businesses spend a whole year reconciling their Xero file incorrectly to find out at tax time there is a lot of correction work required before they will be “tax ready”. Investing at the start of your business with the right advice can save you time and money into the future. If you’re unsure of the “tax rules” when you are a sole trader, I’d highly recommend booking a Small Biz Brainstorm Session with us.
As your business grows you might find less time you have to spend on the business books. This is a good point to consider outsourcing and hiring a bookkeeper.
Top Tip
Engaging the services of an accountant or bookkeeper is a tax deduction!
The Fun “Stuff”
Now all the tedious stuff is out of the way it’s time to have some fun and get creative. Start marketing your business and get your name out in the world!!! Let your friends and family know your in business and start spreading the word.
Branding
Think of the tone of your business. What colours do you want to use? What suits the industry your in or will speak to your ideal client. Create a board on Pinterst and starting pinning what appeals to you. Depending on your budget you can find branding specialists who will help you build your brand, from font’s and colours to a logo. If you’re on a budget have a look on Fivver. Canva is another good site to help create your branding. Also remember having a registered business name is completely different from owning your own trademark. A trade mark legally protects your company's unique brand, name of a product, or your services. You can register your trademark with IP Australia.
Social Media
Love it, hate it or somewhere in between as a business owner there is no escaping having an online presence is a must. Especially in the start-up phase if your business doesn’t have a website people need to be able to find you. Get onto Instagram and secure the handles you want for your business. Same goes with Facebook and any other apps your comfortable using.
Who is your customer?
You don’t need to be everyone's cleaner/ website developer/ wedding photographer/ hairdresser. Only you know who your ideal client is. This person is the heart of your business. Every marketing and pricing decision needs to keep them in mind. Know who this person is and visualise them when you are making decisions.
Now you’ve done all the hard work building the foundations of your business, it’s time to go out and take over the world!
