How to start a business

Before you start your business, you must first ask yourself if you are ready to commit to the effort needed to get your idea off the ground. Evaluate your current circumstances (financially, emotionally, and physically).

Although there may never be a ‘perfect’ time to start a business, you need to assess if you are in the right place to start a business.

Research your idea to learn about your competition. Do an extensive Google search using keywords to make sure there is a market for your idea.

What sets your idea apart from its competitors?

Brainstorm and develop your idea.

Get some advice from friends or family as they can help refine and improve your idea

When setting goals for your business or for yourself, use the SMART acronym:

S – Smart

M – Measurable

A – Attainable

R – Relevant

T – Time-bound

If your goals don’t follow this, you’ll have trouble sticking at them. Goals are only useful if they make your business better.

If you can’t stick at any of them, you’ll only hurt your business.

Your business plan will outline and direct your efforts. Having a plan will help you prioritise your goals, identify where to improve, and get financial backing from investors (if you’re looking for it). It should include:

• How your business is solving a problem for its potential customers
• What your business does (in the form of a one-sentence elevator pitch)
• Who your target audiences are
• SWOT analysis – Strengths, weaknesses, opportunities and threats
• Financial strategy – How you will fund your business
• Marketing strategy – How you will promote your business

Your business plan doesn’t need to be overly long or complex but having it written out will keep you more focused on your goals.

If you aren’t the only person involved in the business, then you need to decide how to split the equity. You should consider the following:

• Whose idea founded the business?
• How each person has or is going to contribute?
• Who wants to be the ‘boss’?
• Who is contributing financially
• What is the amount of time each person has/is committing?
• Who has a vested interest in the continued success of the business (is planning on staying with the business for the foreseeable future)?

Once you have an understanding of the factors above, you can then decide as a group how you will split the equity.

It is crucial in the beginning stages of your business that you know your financial standing.

Do you have the money you need?

Will you self fund or will you need money from investors?

If you need investment, you will need your business plan in order to sell your potential investors on your idea and prove why their investment will be worth it.

You must also be straightforward about your current finances and what you will need from them.

It may also be a good idea to lean on friends and family as they may well be your biggest supporters.

You should always come to an agreement before they get involved to avoid any strain on the relationship.

If required, you can also seek angel investors, apply for bank loans or attempt to crowdsource through websites such a Kickstarter.com.

Every country, state/territory, and industry will require you to have different licenses, registrations and permits to conduct certain activities.

These help to protect the business, employees, or those impacted by the opening of the business.

These include:

• General business licenses to operate in your location
• Zoning permits – these dictate what kinds of businesses can and cannot operate in your area. For example, you may not be able to simply open a bar in a residential street
• Building/Construction permits – if you are planning to make structural changes to the place where you will be running your business, you may need to apply for this permit
• Health permits – these are required if your business handles or prepares food.
• Special/regulated business license – these are generally required for businesses that need to meet state-specific standards, such as liquor licenses.
• Home-based business permits
• Federal/state license – if your industry is regulated by a federal agency, you will need to apply for this license. Examples of these industries include agriculture, alcohol manufacturing, television, mining, transport, and logistics
• Professional/occupational license – certain professions will require special licenses to operate, such as those involved in childcare, law, and medicine
• Sales tax license/permit – if your business will be selling goods online or in-person you will likely be required to collect sales tax, which will mean you need to obtain this permit.

Register your business early on to protect yourself from a legal perspective. Also, consider how to protect your intellectual property (IP) to ensure the ideas and inventions behind the business are protected.

Intellectual Property protections include:

• Patents – protect any new inventions from being used by others
• Trademarks – protect how your business identifies itself, i.e logos, words, symbols, names and other branding
• Copyrights – give the owners the right to copy and make sequels or revisions of their works of authorship such as books, music, software, art etc
• Trade Secret Rights – allow the owners of the right to take action against anyone who shares confidential information, such as recipe formulas, client lists, to computer programs.
• Non-disclosure/Confidentiality Agreements – prevent the sharing of information to a third-party
• Privacy policy and Terms of Use Agreements – are used for businesses who operate online. These agreements limit how users can/cannot use the information provided and informs them of how any information they provide will be used.

Bookkeeping involves recording all transactions made with the business. Bookkeeping will help you manage your cash flow, demonstrate your financial position to investors, lendors and the bank, meet your superannuation and tax requirements, and keep you updated on the health of your business.

Back up your records or keep multiple copies that are locked up/protected by passwords.

By law all recordings must be legible, be able to be explained and kept for five years (some must be kept for longer).

You will need to keep a record of the following:

• Income and Sales Records
• Employment and contractor records
• Bank records
• Purchase and Expense records
• Sales taxes E.g.  Goods and Services Tax (GST) records in Australia
• Year-end records (Who owes you money, or who you owe money to)
• Tax filings

If you are planning on leasing office space or opening an operating space,  do your research to ensure you are getting the best deal possible.

You need to consider:

• The length of the lease
• If the building requires improvements/repairs
• Rent cost
• Flexibility for subletting
• Hiring tenant representative services

A website is a great way for clients to find you and for you to share what your business does for partners or investors.

Here are some tips for building a great website:

• Research the websites of your competitors
• Develop a template/plan to show your website developer
• Ensure the website is Search Engine Optimised (SEO) so that it will show up for potential customers on Google
• Write high-quality, original content
• Ensure the website loads quickly
• Check that it can be viewed on desktop, android and smart phones
• Choose a memorable domain name that ends in .com rather than .org
• Make sure the site is functional
• Have a privacy policy and terms of use agreement
• Make sure the site is easy to navigate, understand and is not cluttered
• Make sure anyone visiting the site can easily contact you or buy the product

If you’re planning on recruiting employees, use this checklist to ensure you are meeting your personal and legal requirements:

• Think about why you are hiring them. What position do you need them to take within the business? What tasks will they be required to do? How long will you need them for? How many days and what hours will they be required for (casual, part-time, full-time or contract)
• Assess the costs of hiring and decide what the business can afford. You need to consider pay rates/wages, allowances, overtime, leave and penalty rates. Also, consider tax, superannuation and works compensation. You may also need to make structural changes to your workplace to make it more accessible or safer.
• You will most likely need to advertise for the job. Websites like jobsearch.gov.au and seek.com.au are great for promoting the role and selecting candidates. Whilst you can have preferences such as amount of experience, education level and qualifications, you must ensure you do not discriminate against characteristics such as sex, race and religion.
• When interviewing for the position, you need to agree upon the job title, dates of employment, salary and responsibilities. You should enquire about their previous roles, reasons for leaving, references and character. If you are looking for certain traits such as ability to work as a team player, ask relevant questions or find out if they have prior experience.
• Make yourself aware of the laws around terminating employees.

Marketing your business can help build your brand, reach existing customers, attract new ones and increase your profit.

The first thing you need to do is think about how you want to position your business.

Think about how you want your business to be seen by others

You could market it as a top-quality service or maybe you are cheaper than your competition.

Next, think about the tactics you want to use.

SEO will greatly increase your businesses chance of being found when googled.

Social media is also a great and often cost-free way to promote your business or products.

Content marketing and engaging with other relevant brands is another excellent way to put your business out there.

Find what suits your business and do it well.

It’s important to keep up with announcements and new developments from your competitors to ensure your business stays relevant.

Updating your website regularly and setting up Google alerts are both great ways to stay on the ball.

Always stay on top of the following questions:

• Who are your main competitors?
• What sets your business apart
• What are your business’s biggest short-comings
• How does your business compare to its competitors?
• How can your business increase its profits?