According to the Australian Bureau of Statistics, 60 percent of small businesses would fail and cease to operate within the first 3 years of their start-up. Huffington Post published an article in 2015 investigating the causes of failure behind this alarming statistic. The results fell into one or a combination of the following categories:
- Insufficient planning e.g. Fail to conduct appropriate market research.
- Poor management e.g. Unaware of or disregard operational issues.
- Ran out of capital e.g. Relates to the first two points plus having little or no financial control strategies.
If you are thinking about starting a business or currently running a business; don’t let this statistic discourage you.
Whilst it may be impossible to predict the outcome of an innovative idea or venture, business advisory experts in many instances can help you gain another perspective through their industry experience and proven strategies. It is also important to engage business advisors to keep you accountable; an accountability to keep you in a rational mindset and follow simple business principles to avoid major pitfalls in all stages of your business.
At C Advisory, we can provide business advice to help you:
- Consider your best option for starting a business, e.g. Branch out as a sole trader, purchase an existing business or franchise etc.
- Discuss a suitable business structure for financial & legal liability and taxation purposes, e.g. Limited liability companies, unlimited liability companies, proprietary companies, public companies and others.
- Create a business plan.
- Protect your idea through intellectual property copyright.
- Develop a financial/cash flow model to test the feasibility of your business idea.
- Plan your taxes in advance to minimise unnecessary expenses and adhere to legal compliance.
- Understand your record keeping responsibilities and legitimate tax deduction.
- Explore business sustainability and growth strategies in the short, medium and long term.
- Discuss common risks and mitigation measures, e.g. Consider the need for key person insurance.
- Consider exit strategies, e.g. When to sell and succession planning.
- Review your employee’s superannuation guarantee charges compliance with the tax legislation.