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Some small business accounting hints in starting up in Sydney

Top Tips for small business

Wherever you are based in Australia, starting your own small business can be right up there with having children for many people in terms of major life events. Now while we all know where baby’s come from, at least I hope you do by now, not everyone is as certain on how to get a small business from idea to inception. There are several ways to “create” your own small business and working out which one suits you is the key to early success.

1. Start from scratch. If your idea for a small business is a unique product or service it is unlikely that any other option is going to work for you. Keeping complete control over your business is going to be your highest priority so getting a business that is already in place and trying to modify it to suit you is only going to cause dramas as you seek to fit your round peg into an existing square hole.

2. Buy into an existing business. If you have an acquaintance that is already in business and your personal and professional goals align well then buying part of an existing business is a way of getting into the business world without needing to invest 100% of the capital required to start your desired business. This process needs to be thought through carefully as conflicts can often arise, so ensure the legal aspects are well documented in the event of a sour relationship

3. Buy out an existing business. Often this is best applied to retail and local shop based businesses with a history of trading well and generating repeat business from a built up clientele. Of course be careful that the existing customers base isn’t too emotionally attached to the existing business owner, which can often be the case with businesses such as hairdressers. Whilst it can’t always be easy to tell, careful research should be undertaken to make sure it’s the brand name and product that is what customers are being loyal to.

4. Buy a franchise licence. Franchise models are becoming increasingly popular as a way of entering the small business arena. Many are quite successful, as with any small business, do your research, know exactly what the franchisors future plans are and what support you will receive from head office. Franchise fees can be up to 20% of your gross turnover, which can significantly hamper growth prospects. Also, many franchises have area restrictions which may lock you into a specific geographic area, of course, on the upside it give you the reassurance that no new franchisees will open up in your designated area.

Whilst this is only a brief analysis of the different methods of starting your very own small business, you must also give careful consideration to your business type and personality type to ensure your business model aligns with your personal goals and business goals. Of course you then also need to consider your legal structure, which can be heavily influenced by which of the above paths you choose to follow.

For more information on starting your very own small business, check out the rest of our blogs and articles, or just drop us a line at our small business accountants office in Sydney we’d be happy to discuss your needs with you. Just don’t ask us where baby’s come from, there are plenty of books you can read for that.

 
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