Is your inner entrepreneur calling?

With a shift towards working from home and a boom in new small businesses starting up, this article discusses valuable points that new entrepreneurs need to consider before rushing into their new venture. Covering everything from business plans and funding support, to registering your business and acquiring insurance.

Work from home (WFH) arrangements seem to have got our creative juices flowing with more online, home-based businesses springing up every day, providing a limitless variety of goods and services. Home-based micro businesses (0 – 4 employees) and small businesses (5 – 19 employees) offer everything from retail items to construction industry services. According to a report by the Australian Small Business and Family Enterprise Ombudsman, the number of micro and small businesses in Australia increased from 2.06 million in 2016 to 2.3 million in 2020. The Australian Bureau of Statistics also reported at June 30 2021 there were 2,402,254 actively trading businesses in the Australian economy, representing an annual increase of 3.8%, or 87,806, businesses over the previous 12 months[1].

Are you one of the growing number of Australians thinking about setting up a home-based business? Perhaps you have an idea for a home business but don’t know where to start. Here are a few tips to get you underway.

Business plan: Fail to plan and you plan to fail. A business plan is a must-have for business structure, reviewing the competition, and identifying your vital points of difference. Review it regularly and it will grow and evolve as your business grows and evolves. See the websites we’ve listed below for business plan templates.

Note: when seeking finance or government support, a business plan most likely will be required.

Funding support: the government can assist with funding through start-up grants. Check out www.business.gov.au for government support information.

Structure: Will you set up as a Sole Trader, a Company, or another structure? There are pros and cons for each so you should seek advice from a tax accountant, and/or a solicitor experienced in business.

Registrations: Consider the following registrations, they can protect and legitimise your business.

• Business name: go to businessname.com.au for details.
• Australian Business Number (ABN): see abnregistration.com.au.
• Goods and Services Tax (GST), your accountant can help with this.

Insurance: investigate the types of insurance you may need, e.g., Professional Indemnity, Public Liability, etc. Your financial adviser can assist or refer you to an expert to help you work out your business’s needs.

Office equipment and space.

• A dedicated workspace is essential. Those zoom videos of WFH employees with unsuspecting partners in the background may be funny when it’s someone else, but not a good look for your start-up!
• An online presence: website, social media, business domain including a professional email address. Try to keep it professional.
• Dedicated phone: a business phone will help set structured business hours, tailor your voice messaging appropriately and avoid the risk of little people taking important client calls. Further, service providers sometimes offer special deals on business plans.
• Branding: make a statement by having a designer develop an appropriate logo and colour palette. Then brand everything (website, invoices, etc) in the same colours, fonts, and style.

The key to success is in planning and playing to your strengths while knowing when to seek advice from others, including your accountant and financial planner, and:

• Small Business Australia: smallbusinessaustralia.org
• Australian Securities & Investments Commission: asic.gov.au
• Australian Taxation Office: ato.gov.au
• MoneySmart: moneysmart.gov.au

Starting a business is an exciting experience. It’s a lot of work and maybe slow to get going as you establish yourself, but the rewards can be satisfying!

Now, think about an iconic brand your family has known and trusted for years. Well, here’s the thing – it started with an idea.

[1] https://www.abs.gov.au/statistics/economy/business-indicators/counts-australian-businesses-including-entries-and-exits/latest-release