|With so many decisions to make from moment to moment it’s a bit like being at Grand Central Station and looking for the right train to hop aboard. How do you make sure you hop onto the right one from the start? Before your business has its first growth spurt, make sure you’ve got the right structures in place.
Looking for a lawyer? This directory might help: https://lawpath.com.au/lawyer-directory
This firm has put together some pros and cons for each business structure to get you thinking: http://www.distinctbusinesssolutions.com.au/business-plan/pros-cons-different-business-structures-australia/
The Business dot Gov website has got some great articles on different options for funding your business and how to go about them: https://business.gov.au/finance/seeking-finance
Louise: There are so many decisions to make from moment to moment when you’re running your own business. It’s a bit like being a Grand Central Station and looking for the right train to hop aboard, but how do you make sure you hop onto the right one? … I’m Louise Poole
Andy: And I’m Andy Le Roy, and we’re giving you the insights that elevate you as the expert in your field
Louise: In the beginning, there was the spark of an idea
Andy: And before too long, that idea took form
Louise: It grew legs and started to walk
Andy: Then it seemed to develop a mind of its own
Louise: So before this glorious new beast runs off into the sunset with stars in its eyes, we need to think about what it’s going to need.
Andy: I thought we were using the train analogy
Louise: (sigh) OK, driver, choose a platform
Andy: Not a bad start. We all want to get somewhere with what we’re doing, so it’s important to think about our destination and the stops along the way.
Louise: It’s really handy to think about what experienced you’re looking for, and how much time you’re prepared to stay there.
Andy: Ordinarily we’d start out with plan, Plan, PLAN!
Louise: But this time we’re going to look through the tour guide and see what excites us the most.
Andy: Structure is vital. Without the right foundations, your business might outgrow it’s structure really quickly, or take what feels like an eternity to get there.
Louise: Before you jump right on in and register your business, have a think about the different structures available and the implications of each type.
Andy: Operating as a sole trader or partnership are completely legitimate ways to operate your business, but how will this impact on your growth plans?
Louise: If you’re signing contracts with customers and decide to change to a company structure instead, what will be the impact, aside from immediate costs, of novating those contracts?
Andy: That sounds like a fancy term, Louise
Louise: It does, I’ve been chatting to lawyers, and one of them told me about the risks involved with novating contracts, which is just a legal term for updating a contract between your client and your business in its new form
Andy: The things to think about here are not only the cost of drawing up new contracts, but whether the suggestion of new contract will prompt your client to negotiate different terms to what was in place
Louise: Another thing to think about is how you’re going to fund your business
Andy: Cash flow is really important for obvious reasons, so how will you get the money flowing in the first twelve months of trade? Will you boot-strap the funds?
Louise: Which is a fancy way of saying you’ll pay for everything yourself out of your savings
Andy: Or will you seek funding from external sources?
Louise: This might mean fronting up to the bank for a loan, or attracting private investors, who may want to have a say in your decision-making in return for their investment
Andy: So many possibilities before we even start speaking to our first prospective customer!
Louise: The best bet is to speak to as many professionals as you can. Have a chat to a lawyer about the best operating structure for what you want to do into the medium and long terms.
Andy: Speak to a tax specialist about the tax implications for each option available to you
Louise: There are also lots of state and federal resources available to help you navigate the right path for your business.
Andy: So before your train departs, you’ll know you’re going in the right direction, with no unexpected stops
Louise: Starting a new business can seem like a pretty daunting task, but it doesn’t have to be.
Andy: We’ve added some tips and links in the show notes, but let’s quickly double back on the important parts
Louise: Do your research and make sure the structure you choose is going to be the right one for where you want to be in five years time.
Andy: Find a lawyer who specialises in your line of work and chat about the pros and cons for different structures against your vision.
Louise: Tax is also important to think about, and how different funding models might help or hinder your growth.
Andy: Next time on Elevating Experts: Refining your brand voice for different social media platforms
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