So it?s important if setting up a business to make every dollar count! Here are a few basic tips for doing just that.
Have a written business plan
Having a written business plan is so important! It can be tempting to rush straight in when we have a business idea because of course it?s the best idea ever, it?s going to set the world on fire, no one have ever had such a perfect idea … It?s exciting! But you need to take a step back, look at the big picture and put a business plan together.
A business plan will map out your goals, strategy, the market competition, the financial realities of what you?re wanting to achieve. And keep in mind, even if you?re not needing to borrow money to set up your business, even if you?re not needing to invest much capital at all, there?s still the opportunity cost of your time. What else could you be doing, how else could you be earning money, if you weren?t devoting yourself to this business? A business plan can help increase the likelihood of business survival. The government?s business.gov.au website has tips on writing a business plan and plan templates that you can download.
Understand your financial obligations
Before setting up your business you?ll need to decide on a business structure, apply for an ABN, register your business name and website, organise any licenses you?ll need and understand your tax responsibilities. It?s a long and complex list!
All of these things, if you do them properly, will save you money in the long run. Get professional advice from your accountant but also learn about it yourself – visit business.gov.au for guidance.
Have good accounting software
Good accounting software helps you produce a detailed and realistic budget, plus an excellent cash flow analysis. Don?t just grab the first software package you see – take the time to talk with a staff member at your place of purchase about what your needs are. Especially for SMEs, time is money and you don?t want to spend a lot of that time trying to sort out your paperwork. It also makes it much easier at tax time if you?ve used a good accounting software system during the year.
Be organised in general
National research conducted by Officeworks found that for 87% of SMEs, an organised office increases productivity. And on the flip side, 77% of SMEs said that a disorganised workspace ultimately leaves them feeling disorganised as a whole. So while it might seem like a minor thing when you?re in the grip of your brilliant business idea, having filing and storage solutions, a shredder to dispose of unwanted paperwork securely, a scanner – all those office basics – can make a big difference to the day to day running of your business.
Know what you can claim on tax
It really goes without saying, but make sure you keep records of anything that might be tax deductible. Your business running costs – electricity, phone and so forth – as well as items such as office furniture, stationery, printers, scanners. Depending on how much you spend, some things may need to be depreciated, some may be an immediate tax deduction. Take a copy of all paperwork to your accountant to seek professional advice.
No matter how organised your physical paperwork is, a digital copy of everything is invaluable. Additionally, scanning important documents and saving to a USB or hard drive may be more economical and environmentally friendly in the long run!
Particularly for micro/small businesses, it?s crucial for customers to be able to contact you – whether by via smartphone, tablet, or laptop. Small business owners and employees often juggle many roles so you may also require a wireless printer and scanner to stay connected on the go. Depending on your business, there could be a need for a mobile point of sale payment device – ask your financial institution for more details.
Think about your insurance needs
All your hard work getting your business off the ground could be ruined without insurance to cover both yourself and your business premises. Talk to your adviser about personal insurance for your life and income, property insurance for your business and liability insurance. You can also find out more about Business Life Insurance here.