Setting up a business isn’t for the faint-hearted. It requires thorough planning and close consideration of a range of set-up costs you’ll need to cover before you can open your doors. These should be set out in your business plan, so you’ll know exactly how much investment capital or financing you’ll need to turn your million-dollar idea into a sustainable business. Here’s what can expect to pay when starting a small business in Australia.
1. Business registration and insurance
You’ll likely need to register an Australian Business Number (ABN) and a business name. Registering a proprietary limited company (Pty Ltd) will cost you a little under $500, and you’ll also need to organise the appropriate insurances. And don’t forget any permits and licences you’ll need to begin operations – these usually attract a fee as well.
2. Business premises
Unless you’re a sole trader who intends to work from home or a digital nomad, you’ll need a place to do business. This could be a retail store, factory, or offices. If you’re planning to buy your business premises, you’ll need a deposit, and if you’re renting, you’ll need to pay a bond plus at least a month’s rent in advance. You’ll also need to budget for furnishing your new workplace and for utility connection fees.
3. Machinery and equipment
This is also a good time to decide whether it makes more financial sense to buy or lease any machinery or equipment you need to operate your business. While this will be a particularly important step for manufacturers and tradesmen, professional services providers will also need to think about computer equipment, and retailers should look into the costs of point-of-sale technology.
Most businesses require a range of software solutions – from customer relationship management (CRM) platforms to accounting software. The good news is that with many cloud-based software providers such as QuickBooks Online now operating on a subscription model, you can avoid steep up-front software costs in favour of more manageable monthly payments.
5. Inventory and materials
If you’re setting up a retail business, you’ll need to purchase enough supply to fill your bricks-and-mortar or online store prior to your launch. Likewise, manufacturers will need to stockpile materials to fulfil your initial orders.
6. Marketing and advertising
Announcing your new business to your potential customers requires a marketing budget. Depending on your type of industry, you should consider things like website design, hosting costs, and domain name registration. Additionally, online advertising campaigns via Google Ads or relevant social media platforms and other, more traditional forms of advertising can help spread the word more quickly.
7. Recruitment and payroll
Any business is only as good as its people, so investing some coin into recruiting the right employees will pay for itself in the long run. Whether you choose to seek the services of a recruitment company, or decide to advertise directly on job seeker websites, there will be an associated cost. It’s also a good idea to have at least a few months of payroll in the bank, so you are able to pay your recruits while your business builds momentum.
Starting a sustainable small business doesn’t come cheap. However, if you give the proper consideration to the startup costs you’ll need before opening your doors, you’ll be well on your way to achieving small business success.