How to Start a Business in Australia

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

1. Do your research

All it takes is one great idea. After that, the challenge is to investigate 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 questions to ask yourself 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.Visa requirements (for non-Australian business owners)

If you’re not an Australian citizen or permanent resident, you’ll need the right visa to legally start and operate a business in Australia. Options include Business Innovation and Investment visas or Entrepreneur visas, depending on your business model and capital.

More details are available at business.gov.au.

3. Create a 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 helping to 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.

4. 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.

5. 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 include applying for an Australian Business Number (ABN) and registering for GST if your business has an annual turnover of $75,000 or more.

6. Estimate startup costs and forecast cash flow

Before launching, calculate your estimated startup costs. Common startup expenses include:

• Operational costs, like rent, utilities and office supplies.
• Marketing budget, such as advertising, branding and website setup.
• Equipment, including tools, machinery and smart devices.
• Wages for staff and contractors (if applicable).
• Insurance

In addition to estimating costs, it’s important to forecast your cash flow. Create a monthly projection of income and expenses so you can identify shortfalls early and plan for sustainability.

7. Consider business insurance

Business insurance can help to protect you from financial loss caused by unexpected events such as property damage, lawsuits, theft or interruptions to your operations. If an unexpected event occurs during the early days of your business, then this could significantly impact your finances and fledgling reputation.

Some of the common types of insurance you may wish to consider include Professional Indemnity, Public Liability, Cyber Liability, and Personal Accident and Illness insurance.

8. Establish your capital

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.

For more information, read BizCover’s cash flow management tips.

9. Set up a business bank account

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

Separate accounts simplify your tax reporting, budgeting, and bookkeeping. They also lend credibility to your business and make it easier to access funding or credit later on.

8. Launch your business

Launching your business is a major milestone — but it’s just the beginning. The success of your business depends on how well you promote it, connect with your target audience, and adapt as you grow.

Here are a few essential steps to consider during your launch phase:

1. Build a strong online presence: This starts with creating a professional and user-friendly website. Make sure that your domain name is available and makes sense for your business.
2. Set up your marketing channels: This includes social media channels, email marketing, local marketing (such as flyers and signage) and potentially paid advertising.
3. Establish your brand identity: Settle on your brand colours and logo as well as tone of voice.
4. Network: Seek out local business networks or chambers of commerce, and list your business on Google Business Profile and other relevant directories.
5. Track performance and iterate: Keep a close eye on your metrics, such as Sales, website traffic, conversion rates, customer reviews, and social media engagement. Use analytics tools (such as Google Analytics and Meta Insights) to help you track these figures. This will help you uncover what works and what doesn’t.

Are you ready to launch your business?

Launching a business is an ongoing process of learning, improving and growing. With the right research, positioning and mindset, you can ensure that your business has everything it needs to thrive in the modern Australian economy.

To help protect what you’ve built, BizCover offers a range of business insurance options from some of Australia’s leading providers. Through our online platform, you can quote and compare policies in minutes. For on the go cover, go BizCover.