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A wannabe entrepreneur’s guide to starting a business
Andrew Stubbs • Feb 04, 2019

Starting a business is part science, part art, and a large part hard work! It can get lost in all the excitement but you need to get the balance right. 

Approximately 20 percent of all small businesses fail in their first year; and your chances of your business making it to five years are around 50/50. 

One thing is for sure: leaving your success up to chance is not an option. Get clear on where you want to take your business and how you are going to get there. 

Reasons small businesses fail include the following: 

  • No market need for their products or services
  • Lack of cash flow
  • Not having the right team in place
  • The competition doing it better
  • Pricing and cost issues
  • Lack of a business model to follow
  • Poor sales and marketing ability 

So what are the essentials needed for your business to thrive? How do you ensure your business doesn't fall away due to one of the above - or any other reason? 

By asking the right questions from the start. The following will get you thinking along the right lines from day one… 

  1. How passionate are you about this?  

It sometimes gets lost in all the calculations but you should LOVE what you are about to start. 

Is it something that you can see yourself doing in five or ten years? If not, maybe you need to look elsewhere. 

Passion is what keeps you going through rough times. It sustains you and ensures the necessary energy goes into the venture. There will be difficulties in the years ahead but passion will see you though. 

  1. Do you really need to quit your 'real' job yet?  

A healthy obsession with your business idea is fine. But it can blind you and cause you to make hasty and unnecessary decisions. 

Some business owners give up their jobs before they start their businesses. They may be better advised to keep the job (and the steady salary) and start their business as a small side venture-often referred to these days as 'a side hustle'-at first. 

There are 168 hours in a week. If you're passionate about your new venture, spending a few extra hours a week on it won't seem like extra work! 

Save the financial stresses caused by a business HAVING to support you from day one. 

Who are you partnering with?  

If you are partnering with someone in your business, make sure that it works for you both. If you complement each other and it makes the business stronger, great! 

If not, then why are you going into business together? 

A business is not the place for a 'marriage of convenience'. If you take that path, it won't be long before problems rear their head. 

  1. You can't do everything - who is going to help?  

How are you going to find the people that help you run your business? 

Doing everything yourself might seem like a cost-saver at first but soon you'll realise that it's a false economy - and it will lead to burnout. 

Hire professionals to ease the load: a business accountant (not only a tax accountant), a legal contact, a personal assistant, and a marketing assistant are some basic requirements. To avoid paying full-time salaries, outsource to the right professionals. 

  1. Do you understand your competitors and the market?  

Passion alone won't sustain your business. You need a clear understanding of the niche you are entering. 

Who are your competitors? Is there room for another business like yours? If so, how will you stand out - Service? Price? Quality? 

If you are breaking new ground, have you established that there is a genuine need for what you offer? Be sure that it's not just you who thinks it's a great idea? 

Be clear on your target audience and who is going to buy from you. 

  1. How will you structure your business?  

Establishing the right legal structure for your business is also a basic requirement. 

Your options will vary depending on the type of your business and your family situation, but seek advice from a qualified accountant experienced in providing structuring advice to get the fundamentals in place. 

The business structure you choose will affect taxes, administration, liability, and employee setup, amongst other aspects of your business, so it can be an expensive mistake to not get this right from the outset. 

  1. How will you fund your business?  

Mapping out the capital available to you should be part of any business plan: the start-up money may come from savings, friends, family, business partners, investors, venture capitalists, or through bank loans. 

Get clear on how you will raise enough to get your business going, what your weekly and monthly 'cash burn' will be until you reach cash flow break-even point (after which the business funds itself), and then, establish how you are going to manage your cash flow in the coming months and years. 

  1. How will you market and sell your products or services?  

Sales and marketing are two areas that will help to define the success (or otherwise) of your business. Take advice on the best marketing channels - both online and offline. 

Also, if your sales skills are poor, make sure you hire someone who can close the deals that will bring new customers into your business. 

Many new business owners have already established some relationships to provide initial wins - but what do you do when these dry up? You need a healthy ongoing pipeline of leads and prospects.

  1. Are you getting the right advice from the right accountant?  

Business owners should be on top of their taxes, payments, and accounts; and keep a tight handle on outgoing expenditure. 

A good accountant can advise you on this, as well as helping you identify opportunities to grow your business as you mature. 

Make sure you have chosen an accountant you can work with and who has experience advising businesses like yours, as this will be a crucial relationship that shapes the future of your business.  

Chances of success are actually relatively high if you ask the right questions before you start your new business venture. Many new business owners get caught out by the unexpected because they have not planned properly with cash, personnel, market research or other key factors.  

Start by asking the above questions and go in with your eyes open!

By Andrew Stubbs 05 Jun, 2022
Here's some good news if your business sends invoices to business or government customers. Peppol* is on its way. (That's Peppol, not Peppa .) Ever had this conversation in your business? You or one of your team: "Hello, I'm calling to follow up the invoice we emailed to you last month. It hasn't been paid yet." Customer: "Really? We didn't receive that invoice?" In addition to the time and expense of following up, the cash flow delays create stress for you and they hurt your business. Thankfully, the adoption of Peppol will solve this problem. What is Peppol? Peppol is an obscure acronym for Pan-European Public Procurement On-Line. What's more important than what it stands for, is what it enables. Peppol is an international 'eProcurement' framework for the electronic exchange of information. It creates a standard approach for governments and businesses to structure and exchange information such as invoices and other documents. What Peppol means for you and your business Peppol makes electronic ordering, invoicing and shipping between governments and private companies faster, simpler and more secure. This means your business will get paid faster when dealing with government and larger businesses. In 2019, Australia and New Zealand adopted this platform for e-invoicing which, when implemented, will make 'we never received your invoice' issues virtually impossible. The new e-invoicing system is more secure than email and provides many other benefits. Which countries are adopting Peppol? There are currently 40 OpenPeppol member countries: 32 countries in Europe plus Australia, New Zealand, USA, Canada, China, Japan, Mexico and Singapore. Each country has a Peppol authority. For example, in Australia that's the Australian Tax Office (ATO). Is Peppol already in use? Yes it is. For example, the SuperStream system in Australia-which many businesses are currently using to automate the payment of employee superannuation contributions-is based on the Peppol protocol. How does e-invoicing work? The system connects the accounting systems of all businesses and government departments via the secure Peppol network.  Suppliers generate sales invoices in their accounting systems which are sent to Peppol.
By Andrew Stubbs 04 May, 2022
If you're a director of an Australian company-or you plan to be-take 5 minutes now to read this article. All existing directors (and intending directors) of Australian companies need to be aware that the Australian Government has announced the introduction of a new mandatory Director Identification Number (DIN) system. (You'll notice the term director ID is also used for DIN.) This system is the initial step in the Modernising Business Registry (MBR) Program which has been established under the Treasury Laws Amendment Act which was legislated by the Australian Government in 2020. More information on the MBR program can be found here . What is the DIN system trying to achieve? The DIN aims to provide accountability and traceability of a director's relationships over time, across all companies and will provide information on a director's involvement in what may be repeated unlawful activity, including illegal phoenix activity. It should also solve the problem of false or fraudulent director identities. What are the key features? It is mandatory for all directors, foreign directors and alternate directors of Australian companies to hold a DIN. The DIN is a unique 15 digit number. The first 3 digits will be 036 which is the identifier for Australia. The last digit is a check digit to help with accuracy when quoting your DIN. Like your tax file number, you will only be issued with one DIN which you will hold for life - even if you cease acting as a director for any period. To obtain a DIN, you will need to prove your identity so you will not be able to hold multiple DINs. Other office holders (e.g. company secretaries) are not required to register. The director is responsible for updating the DIN records for any changes in personal information within 7 days of the change. The director must apply personally. The process cannot be completed by your accountant, lawyer, spouse or executive assistant. There are significant penalties for non-compliance. How do you apply for a DIN? Directors have 3 options for applying. You can apply online from 1 November 2021. To use this method, you must first establish your identity via myGovID (an app you download on your smart device which is different from myGov). Once set up, your myGovID will make accessing a wide range of government services easier. (It's not just for your DIN application). For information on how to set up a myGovID please go to https://www.mygovid.gov.au/set-up During the DIN application process, you will need additional information such as your tax file number (TFN) and your residential address as per ATO records. It would also be advisable to have other personal details such as bank account details, medicare card or a recent income tax assessment available in case these are required. You can also apply by phone ( 13 62 50 ). During the call, the operator will ask for the identity documents you would have used to obtain your myGovID (passport and driver licence) as well as the additional information listed above. These details will be confirmed with the records held on existing government databases and, assuming the details agree, your DIN will be issued. Or you can apply by mail, but this is not recommended because the process for doing this seems vague ("Write to us") which means you can probably expect a lengthy process of certifying documents and coping with the vagaries of the postal system. One of the other two methods would be a better choice. When will you need to apply for a DIN? Transitional arrangements will allow directors to become familiar with the new requirement. When you need to have a director ID will depend on when you were appointed as a director.
By Andrew Stubbs 07 Apr, 2022
If you're a small business owner, you're always on the lookout for better ways to go about routine tasks to boost growth and underpin reliability. So, yes, you have the will; now, what are the ways? What are those consistent routines you can instill that will have the most benefits? This article looks at the top 6 things you can do to help your business thrive. We're going to cover finances, goals, marketing, technology and you ! So, let's take a look… 1. Your finances are a scorecard … and a predictor Boil it all down and dollars in the bank are the report card on the health of your business operations. Surprising then that so many people don't really pay much attention to how much they've earned, nor how much they're likely to earn. As much as it might feel like a chore, reviewing your sales and financial projections and then using them to ascertain if you need business financing is a discipline worth cultivating . If you suspect that your cash flow is precarious, you should be checking out your options today. First metric to check: your credit score. If it is too low, you need to take steps to shore it up. Next, check in with your bank or finance broker about what loans are available. 2. Goal setting, goal achieving, goal celebrating So, if you're using current and future dollars in the bank to keep score, the next thing is to do something about it. This is where goal setting comes in. If thoughtfully set and persistently pursued, goals help you orientate your willpower and your energy at each moment of the business day. This is the hidden power of goals: giving you a good sense of direction and a way to channel your instincts towards wise objectives. Constantly checking in with your goals makes them a benchmarking tool to keep your business pointed in the right direction. Yes, just having goals helps. Actually achieving a goal helps too, of course! 3. Increasing the impact of your marketing Marketing is not magic. It is not a mystery. It is not an art. However, many less-than-reputable marketers will try to claim that it is. They do so to gain wiggle room to pad their invoices and cover up their lack of skill. What this means is that it is easy to waste money on ineffective marketing. The good news is that there are many low-budget marketing strategies that actually work to help grow your brand and reputation. Scout around on the internet and choose one or two new tactics. Deploy them and test them. If they work, double down. If they don't, try something else. If you can't tell if they're working, also try something else. Social media is the obvious starting place for these low-stakes experiments and the old classics of LinkedIn, Facebook and Twitter are where to trial them. 4. Bringing your business up to date technologically The ability of modern productivity and project-management tools to give small players the same capabilities as the big boys simply cannot be ignored. Harness them properly and they'll let your small businesses operate with the same productivity as the titans of your sector. And, if your business is in the services sector, the increased controls that business technologies can yield also lets you be highly agile - that's something the big boys can't do. So, ask yourself: are you taking full advantage of what's out there? Don't worry, the answer to this question is always 'no' - the field is simply moving too fast for anyone to be able to take full advantage. However, if you have a realistic view of your needs, then you have a yardstick to help assess all the solutions out there. When you know what you need the technology to do, then you can wisely choose what hardware, software, platforms and techniques to introduce. 5. SEO has changed and it is going to change again Google - indeed all platforms offering broad search functions, from Youtube to Facebook - are constantly altering and optimising their algorithms. This, in turn, means SEO practice must constantly evolve to keep pace. So, if your SEO approach hasn't been overhauled in a few years, the time has come to give it some attention. Do a review of best practice and score how you cater to SEO in your online presences. Yet, because the underlying concept of SEO has not changed, the corrective actions you need to take may not be major. Then again, they might be! It is better to know unpleasant news sooner than outright bad news later. 6. Download the right new apps The remote work trend has gone mega and this means mobile productivity apps are very much of-the-moment. See, you can get a surprising amount done with just your phone and tablet. And apps are how it all happens … plus connectivity and a full battery, of course! Usually, apps are best for keeping an eye on things, boosting effectiveness on the "busy" tasks and enabling you to give your stamp of approval to work that needs your say-so to progress. In general, these are not value-adding tasks, just the value-neutral tasks that get in the way of the value-adding tasks. Now, there is no end of apps out there. So, as always, don't bother looking until you have some idea of what you need. 7. You are the ultimate business tool Health is the single most important aspect to consider for anyone running a business. It's the non-negotiable factor that governs everything else you are capable of. To adapt a quote from Arnold Schwarzenegger, being fit and healthy is "a status symbol. It reflects you worked hard for it; no money can buy it. You cannot borrow it, you cannot inherit it, you cannot steal it". This means that you must get enough sleep every night (most people need 7 hours or more). This means a healthy diet must become your preferred way of eating. This means that you should exercise every single day (except when sick). This means you must give your mind a rest too . Meditation isn't some mystic monkish thing, it's simply the practice of letting your thoughts come and go while you - the observer - stay peaceful and undisturbed by them. Think of it like this, meditating is mediating your mind. Take stock, choose wisely, make small steps in the right direction In this article, we've talked about some improvements you can make to what you're already doing. You don't have to do all of these at once. Start with the one that seems easiest and then stick with it to see if it works. Remember, it's not always about big changes. Often, you can make major improvements in outcome by making small changes to input. Doing the little things better. So take stock, choose wisely and be sure to make those small steps in the right direction for success today, tomorrow and the next day.
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