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So you have a great idea for an online store, most likely with items you’re either buying, making or having made? We will presume you have got this far and know what you want to sell but we have some great tips on wholesale and manufacturing if you are unsure.
With items stored and ready to sell, or at least in the pipeline, you’ll be itching to look into building your online store. However, there are several planning steps that are really important to undertake before you launch into website creation.
Figuring out your business model and creating a business plan is essential. It’s also a great way to solidify thoughts you have about your business and tackle the areas you haven’t given much thought to. For a business plan it’s important to consider:
If you don’t have the capital required to get your business off the ground, securing funding is a very important early step. We list strategies to launch a business with zero cash investment here. It may be worth considering crowdfunding, fintech loans, investors and Government grants.
If you’re not sure how much money you’ll need, aim to speak to other businesses running a similar model, take a course targeted at your type of business and/or speak to a business adviser.
Your business structure can be important for the purposes of tax administration, salary management and cash flow. According to business.gov.au, the four most common business structures for small Australian businesses are: sole trader; company, partnership; and trust. We explain the difference between the four here. It’s a good idea to discuss which structure would be best for you with your accountant, lawyer or business adviser. (And yes, it’s a good idea to have an accountant, lawyer and/or business adviser!)
If you’re operating as a sole trader, partnership or trust, you need to register your business name with the Australian Securities and Investments Commission (ASIC). If you’re operating as a company, you must register your company and your business name with ASIC, though if they’re the same name you only have to register the company. You can check to see if the business name is available at ABN Lookup. You don’t have to register a business name if you’re operating under your own name (first name and surname).
Once you’ve registered you business name, the Tax Office will issue you with an Australian Business Number (ABN), which needs to be used for all tax matters. If you registered as a company you’ll also be given an Australian Company Number (ACN) which should appear on all company correspondence.
If your business is going to have a turnover of $75,000 you will need to register for GST. If your business is registered for GST, you'll have to collect some extra money (one-eleventh of the sale price) from your customers and pay it to the Australian Taxation Office (ATO) when it is due. According to the Tax Office, if you don’t register for GST, and you become aware that your GST turnover will exceed the $75,000 per year threshold, you’ll have 21 days to register. Once your business is bringing in funds, if you haven’t registered for GST it's a good idea to check each month to ensure you're not likely to go over the limit.
You can apply for a business bank account at any bank. Keeping your business banking separate from your personal banking can give you a much clearer picture of your cash flow from day one, and will make tax time much easier!
It won’t be at the top of your list of priorities, but before you start shipping stock to your door or employing people, for example, it’s important to look into insurance. The insurance you are most likely to require is Public and Product Liability Insurance but there are others worth considering. We outline the insurance products you might need here.
Did you know that with SecurePay Online Payments you don’t need to pay a thing until people start paying you? Learn more here.