Before you start
Before you start a business, you need to be able to answer a few important questions.
Your answers will help you understand whether you are ready to start a business and whether your business idea is likely to succeed:
- Hobby or business?
- Will your business idea work?
- Do you have the right business skills?
- How will you finance your business?
Is what you’re doing actually a business, or just a hobby? Ask yourself:
- Is your activity being carried out for commercial reasons and in a commercially viable manner?
- Do you intend to make a profit or believe that you will make a profit in the long term?
- Is there repetition and regularity to your activity?
- What is the size, scale or permanency of your activity?
- Is the size or scale of your activity consistent with other businesses in your industry?
- Is your activity planned, organised and carried out in a business-like manner such as do you have a business premises, licenses or qualifications and a registered business name?
To find out more information visit the Australian Taxation Office’s website .
Not every idea equals a successful business. Ask yourself:
- What is the market for your product or service like and how big is it?
- Who would your customers be?
- Who would your competitors be?
- How would your product or service be different to your competitors? Why would customers come to you as opposed to your competitors?
- Has anyone tried this business idea before? Did they succeed or fail?
- What regulations will apply to your business?
- What will be the cost involved with your business?
To get assistance with validating your business idea contact the CBR Innovation Network .
Do you have what it takes to run a business? Ask yourself:
- Are you a motivated person? Do you have drive, ambition and initiative?
- Do you interact well with other people?
- Are you a leader?
- Are you an effective decision maker?
- Are you prepared and able to work long hours?
- How do you handle stress?
- How do you handle change? Are you flexible and adaptable?
- Are you an organised person?
Start-up costs for a business can often be quite high so you need to consider how you will finance these. Initially, you may need to pay for business necessitates such as premises, vehicles, stock and equipment. You also need to consider the cost of fees you will need to pay, such as registration, license, insurance, legal and accounting fees as well as staffing costs (including income for yourself).