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Deciding to launch a new business is an exciting time for any entrepreneur. However, starting a business is demanding and requires a lot of effort and commitment. While it can be a dream come true for many, it’s a long-term process often paved with challenges to overcome. Therefore, before diving in, it’s essential to understand what starting a business entails and how to prepare for it.
Starting a business is a lengthy and challenging process. It can take months to transform an idea into an operational enterprise. Therefore, before embarking on this journey, reflect on your level of motivation, available capital, skills, and ability to drive your business.
Launching a business goes beyond having a unique idea. While a great idea is a solid foundation, building a successful enterprise requires a broader set of skills, including business acumen and interpersonal skills. In its early stages, your business may cost more than it earns, so financial preparedness is crucial. As your business grows, you may need to transition to full-time commitment, leaving your previous employment behind. This transition requires the ability to manage the switch effectively. While being a business owner offers flexibility, it also means you are responsible for every aspect of the business, anytime and anywhere.
First, identify the products or services you want to offer. Ensure it’s something you truly believe in, whether due to passion or a recognized market need. Ask yourself how skilled you are in this area and how profitable it can be. Consider these questions to help generate business ideas:
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Your business idea doesn’t have to be ground-breaking like Apple or Canva. Improving upon an existing product can also lead to success.
Once you have your business idea, gather information about its strengths, weaknesses, opportunities, and threats (SWOT analysis).
Reflect on what differentiates your product from others in the market to identify your Unique Selling Point (USP). This will be your main argument when selling your product to prospective customers. Acknowledge its limits and weaknesses to identify potential threats or opportunities for improvement.Â
Conducting market research will help you identify existing opportunities and threats in the market so you can make realistic assumptions about the potential of your business. Examining your competitors and gathering insights about your target market will help you understand the existing market, pricing, marketing strategies, and industry trends. If your product or service is novel, you can look at similar products to get a market overview.
| Strengths | Weaknesses |
| Internal attributes that are advantageous to achieving your business objectives. Eg.: unique product features, strong brand reputation, loyal customer base, and skilled workforce. | Internal attributes that are detrimental to achieving your business objectives. Eg.: limited financial resources, lack of brand recognition, gaps in capabilities or expertise, and poor location. |
| Opportunities | Threats |
| External factors that the business can capitalize on or use to its advantage.
Eg.: emerging markets, growing trends, technological advancements, changes in regulations, and competitor weaknesses. | External factors that could cause trouble for the business or pose risks.
Eg.: economic downturns, increasing competition, changing customer preferences, and regulatory changes. |
A business plan serves as a roadmap for establishing a new business. It details your vision and helps potential investors, financial institutions, and company management understand your project. Even if you intend to self-finance, a business plan can help you flesh out your idea and spot potential problems.
A business plan should include the following sections:
Selecting the right business structure is crucial for your entrepreneurial journey. The business structure impacts reporting obligations, taxes, personal liability, and ongoing costs. It’s possible to change your structure as the business expands, but careful consideration during the initial setup can prevent unnecessary changes later.
| Structure | Pros | Cons |
| Sole Trader – individual business owner and operator. | Easy to set up, full control and low in cost. | Unlimited liability so personal assets are at risk and doesn’t allow for income splitting so you will be liable for tax on income earned. |
| Partnership – made up of two or more people who share income and losses. | Income will be shared between partners, moderately simple and inexpensive to set up with low reporting requirements. | Liability to each of the partners is unlimited and shared control so risk of disagreements with management. |
| Trust – a trustee conducts the business for the benefit of its beneficiaries. | Assets are protected and there is flexibility in distributing income to beneficiaries. | Can be complex and costly to set up and maintain, may create issues when borrowing. |
| Company – registered separate legal entity. | Limited liability. | Slightly more complex and costly to set up and maintain with greater reporting requirements. |
Starting a business involves numerous administrative tasks, such as registering your business name and domain, setting up bank accounts, obtaining an ABN and TFN, and securing insurance. These tasks are essential for legally establishing and securing your business.
Surround yourself with individuals or companies that bring complementary skills or provide necessary support. Seeking the help of qualified lawyers, accountants, or tax advisors is highly recommended. They can offer industry insights, ensure your business complies with regulations, protect your assets, and help you start your operations on the right foot.
At Breathe Accounting, we alleviate the burden of accounting, bookkeeping, and taxes so that business owners can focus on the operational side of their enterprise. Offering comprehensive support from initial business planning and structure selection to meticulous financial management and tax compliance, our team of experts provides tailored advice and practical solutions to ensure your business is built on a solid foundation. With our dedicated support, you can confidently grow your business, knowing that your financial and administrative tasks are in capable hands.
Once you have completed all the necessary steps and your business is legally registered and ready to operate, it’s time to launch. Activate your promotional activities across various platforms to spread the word. Engage your network, participate in events, post on social media…, and be ready for the journey ahead. You’re ready: let’s go!