Starting a business involves planning, making financial decisions, doing market research, and acquiring knowledge in areas you never thought you would learn about before. This article details a few of the first things you must consider in order to start off on the right foot.
There are a few questions you must ask yourself prior to starting a business such as:
- Is there a want or need for your product or service?
- How hard will it be to develop your idea?
- Is your idea financially viable?
- How will you protect your idea?
- Who are your competitors?
Once you have determined what you want to do and have an idea about who your target market is, it’s extremely crucial to determine the best structure to operate out of.
1. What is the best structure to operate out of?
This is the million dollar question which people must consultant an accountant about prior to setting sail. The four main structures that you can operate out of are:
- Family Trust
- Sole Trader
With this, the main things you will need to take into consideration are the asset protection and the tax effects of operating out of each structure. There are certain points you can reach from a net profit perspective which can trigger when it is economically viable to move from one structure to another. It is best to consult with your accountant when it is appropriate to move.
A company is the most frequent trading vehicle that you will come across. People use companies as they are classified as a separate legal entity meaning that you are separate from the business. With this, if something goes wrong in the business (and you have not broken the rules of being a director), it is usually quarantined within the business, leaving your personal assets safe.
2. What is your business name?
You will need to register a business name with ASIC if you carry on business within Australia and are not trading under your own name. You can always check the availability of Business Names on ASIC’s website. You cannot trade as a business name that is already in existence, you can always ask the current owner if they will transfer the name to you if it is occupied.
3. What is your domain name?
It is usually best practice to get your businesses trading name as it’s domain name i.e. if your businesses name was Brisbane Accountants, you would look to get www.brisbaneaccountants.com.au. With this, people are clued on to the idea of securing domains even when they aren’t using them. This is known as “domain parking” and you can stop people doing this by registering a complaint with the relevant authority. The best place to find a domain name is a place like www.domainpilot.com.au They have a great user interface and very competitive pricing.
In summary, it is an extremely complex task to consider what you are going to do with your business. With this you must also consider your structure, business name and domain name as a few of the core essentials to getting the ball rolling. Contact Link if you are after some ideas about business names or domain names, or if you would like to have a strategy session for some best practice business advice.