How to Start a Business in Australia: 8 – Step Checklist

Australia’s economy is well known for its strength, competitiveness, openness and flexibility. It had stood strong against recent global challenges, and welcomed 406,365 new businesses in 2022-23.

Setting up a small business in Australia is an exciting opportunity to start something new and to pursuit your passion. Our checklist will guide you through the key things you should consider when deciding to set up shop in Australia.

1. Research

It starts with a great idea; the next challenge is to suss out the market to see if your business offerings are viable. You may need to do a bit of market research to find out what your competitors are doing and what other similar products and services may be available.

Here are some other things to consider when in those early research phases:

• What do potential customers want and need? What products and services fulfil those needs?
• Who is the target audience and how to reach them?
• Where is going to be the ideal location to set up a physical store or office?
• How can a business stand out from the competition? Find your point of difference and try to tap into niche markets to really edge out from the crowd

2. Business plan

A business plan is a document that outlines the goals, strategies, market analysis, financial forecasts, and operational structure for a business. It serves as a roadmap for the growth of a business, while also helps secure funding from investors.

A well-crafted business plan covers key things:

Executive summary

This is an overview of the business plan, highlighting the company’s mission statement, the product or service it offers, key financial information, and growth prospects.

Business description

This section provides detailed information about the business, including the business’s goals, target market, legal structure and location.

Products and services

This section describes in detail the products or services offered by the business, the benefits to customers, the product life cycle, and any research and development that might lead to new products or improvements.

Market analysis

This involves research on the industry, market size, expected growth, customer segments, and buying patterns.

3. Choose your business structure

Your business structure will determine your business’s future operational structure, tax obligations and legal responsibilities. Each structure has its pros and cons, so it’s important to consider your business needs, risk appetite, as well as your tax and financial preferences when making your choice.

Here’s a breakdown of the main types of business structures in Australia:

• Sole Trader: This structure is the simplest and involves one individual who owns and runs the business. It’s a great low-cost option for those starting out, offering full control to the owner. However, business owners are also held personally liable for business debts.
• Partnership: Involves two or more people (or entities) who run a business together. Partners share the income, losses, and control of the business.
• Company: A more complex structure, a company is a legal entity separate from its owners (shareholders). This separation provides limited liability to the owners but comes with stricter regulatory requirements.
• Trust: An entity where a trustee operates the business on behalf of the beneficiaries. A trust can provide tax benefits and asset protection but is more complex and costly to set up and run.

4. Register your business

Before you can start a business in Australia there are a few administrative things you will need to do like registering your business. You can find out more about what is required and involved with the process by visiting the Australian Securities and Investments Commission.

You can secure your brand further by trademarking your business name, logo, or even specific product names. A trademark ensures your brand identity is protected Australia-wide and cannot be legally used by others in your industry. Additionally, check the necessary licenses and permits relevant to your business type, as these vary widely depending on the industry and location.

Other required admin tasks that you may need to complete include getting your Australian Business Number and registering for GST if required.

5. Get business insurance

After putting in all this effort to start your own small business, the next logical step is to ensure you are protecting your small business from unwanted risks with Business Insurance*. Business insurance is an important defense against potential financial setbacks.

There are plenty of different types of business insurance options available so make sure you take the time to assess the kind of risks your business may be exposed to and what types of insurance are going to be appropriate.

6. Establish your capital

Chances are like most small businesses you will require some form of funding to help launch your small business. These funds will help to pay for things like your marketing, lease if renting a space and general operational costs. Different businesses will have different expenses and may source their capital from different places.

Understanding your business’s financial needs involves breaking down costs into fixed and variable categories. Fixed costs remain constant regardless of your business activities, such as rent and salaries. Meanwhile, variable costs fluctuate with your business operation, like raw materials and utility bills.

To secure your startup capital, you might consider exploring sources beyond traditional options. Crowdfunding platforms offer a way to raise funds by pitching your business idea to potential backers online. Another method is bootstrapping, or using your personal savings. This approach keeps you in full control of your business but requires careful financial management.

These are some of the typical places you may look to raise capital for your small business:

• Check out if your business is eligible for grants and funding
• Consider the financial assistance of investors
• Loans from financial institutions
• Accessing your own personal savings

If you are unsure about which option is going to suit your business best, it is always wise to seek out the advice of a financial professional like your accountant to give you the appropriate advice.

Recommended reading: Cash flow management tips for small business

7. Set up a business bank account

Having a business bank account provides a secure destination for your earnings and business expenditures.

Consider your business’s specific needs, including transaction volume, the types of transactions you expect to make, and any additional banking services you might need.

Maintaining separate accounts for your business and personal finances is not only smart, but often necessary for clearer financial management. It simplifies accounting, allows for more accurate tax filing, and maintains a professional separation between personal and business finances.

8. Launch your business

Launching your business is just the beginning. Nurturing it through marketing and growth strategies is where the real journey starts. This phase is about making your business known, reaching out to your target audience, and scaling up.

Having an online presence is non-negotiable in today’s digital world. Your website acts as the digital front door to your business, welcoming potential customers and introducing them to what you offer. Ensure you have a professional, user-friendly website that reflects your brand identity and effectively communicates your value proposition.

BizCover offers easy, affordable insurance in minutes, allowing you to focus on your business with confidence. Jump online or give us a call today and get your business insurance sorted in minutes.