Business Advantage FAQs
Starting/Buying a Business
Do I need a registered business name? If you use anything other than your own name, yes. Even companies, if they use another name.
Do I need a business licence? Not as such, but many particular industries need a licence or registration. Check with us.
How much should I set aside for starting my business? There's no magic number. We strongly recommend preparing a realistic budget or cash flow projection to gauge. That will allow for tax, GST, purchasing stock etc.
What risks are involved in starting my own business Many. If you haven't worked in that industry before, many more. It takes a certain personality to cope with the change, to ask for help in things you're not skilled at. Your homework may be optimistic. There will be laws you didn't know about. You've got to change from the mindset of a technician making the product, to manager of the business.
Is it better to be a sole proprietor or to be incorporated? The answer to this question depends on the individual circumstance. It may be simpler to be a sole proprietor, and in other cases it may make more sense to incorporate because of risk. You really should seek advice, there are stamp duty and capital gains tax implications to change.
What should I be aware of when buying a business? We have a checklist of many pages when clients buy a business. No two are the same. Be wary of promises of cash - buy only on figures in tax returns etc. Do as much homework on the vendor as you can too. Will he/she really retire, is there another business that could inflate figures, Watch for cost cutting too - stock being run down, advertising not being renewed.
What government subsidies are there to help me start up? No government will put money into your business to get it going. There are specific programmes however, such as export. Check out The Government Business Entry website for more
How can I cut costs in a recession? This is not easy. Its tempting to run down stock, run down marketing. And cut margins to compete. But you won't have a business left. You must have sufficient working capital to start with. A business living on borrowed money will get in trouble.
We believe in focussing on income, not cutting costs, because income can grow indefinitely, but there's a limit to how many costs can be cut.
What are the warning signs of fraud in my business? Its best to prevent fraud by implementing documented systems and procedures to deter, or make difficult, any opportunities for fraud. Or at least, require collusion between employees to implement.
Watch for anyone who won't take leave. Unusual stock returns. High debtors writeoffs, or high cancelled sales. These all point to someone who doesn't want to be found out, taking stock off the shelves, & pocketing cash from customers. Talk to us about those systems to prevent fraud.
How do I develop a USP for my business? A Unique Selling Point is essential to stand out from your competitors. Otherwise you're just competing on price. There are too many possibilities to cover here. But you think your product is similar to your competitors, then focus on the service before & after the sale. Can that be made different?
How do I get my staff to perform? Every team situation is unique, but here a few tips: Hire on attitude. You can always teach the function. People really are your biggest asset. Staff turnover is very costly in downtime & retraining. Make the positions as interesting and varied as possible. Define responsibilities and expectations. Monitor this performance. Your staff need to understand what's expected. Be clear with instructions. Its not their fault if they don't understand, its yours. Trust them. Allow for some mistakes. Staff do respond to trust. Be clear when delegating. Set the boundaries of what to do, how to do it, when to do it and what not to do. Don't take over when problems happen. Don't fix the problem, show them how to fix it. Give regular feedback. Its human nature to criticise, but not to compliment. Good work is "expected" So keep them informed. Lastly, always remember, if you pay peanuts you get monkeys.
What interview questions should I ask potential employees?When candidates are nervous, they may not be at their best.
So, ask questions that will get them to talk.. Ask them to go over the resume in their own words. Ask about problem solving situations. Explore some particular examples given. Ask some questions that will flush out their personality. Work in a team vs working independently. Deadline pressure. Future aspirations & how this job will assist. How would friends describe them, even what's a favourite book & why.
How do I get new clients/customers Are you sure that is the only answer? The cost of acquiring new clients is many times higher than working with or retaining existing clients. Ask us about your Profit Improvement Potential to highlight some differences.
New client/customer strategies differ from business to business.
You need to plan, & test the results. Some things to think about are
1 Just sell: Make calls, have meetings, put in tender proposals, whatever
2. Marketing: Too many techniques to cover here, but remember to test & measure each strategy
3. Referrals: Don't be frightened to ask for referrals. Of the clients you want to have
4. Partner with others. Look for those alliances
Why is a business plan important Fail to plan, plan to fail.. Its so true. If you have a vision, a goal, you can either drift along & see what happens, or plan to get there.
The failure rate of small business is 50% in the first year, 80% are gone after 5 years. Do you want to fail, drift, or succeed? Most successful businesses have a plan.
What should it contain? Business plans are often provided to financiers, so look at it from there point of view. A history, product/service outline, market share, placement in the market, market trends, targets, constraints to growth, what's needed to grow, Details of management, production IT etc capabilities.strategies & time lines. A SWOT analysis.
What's an exit strategy? Why is it important? Sooner or later you'll retire. Sell to partners or the open market. Maximising that sale price the name of the game. How you hand over, & what you hand over need to be planned well ahead.
Too many business just close the doors. Make sure yours is valuable because it's a turn-key operation.
We recommend you seek specific advice about your specific issues. The information here is necessarily general in nature and neither purports nor is intended to be advice on any particular matter that is appropriate to your circumstances.
Neither Crown Accounting Pty Limited or any member or employee assumes any responsibility in any way whatsoever to any person in respect of the information contained on this website, including any errors or omissions herein how so ever caused.
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