Business Plan

Starting a Business from Scratch

There are too many variables when starting a business to be able to provide a comprehensive checklist that would cover all the actions required for all types of businesses, but here is a list of the general basics. Each of these steps has volumes of further information available, and it’s important to research and have a good understanding of all of them.


  • Decide on your ideal business entity type. The 4 main options are:
    1) Sole Trader
    2) Partnership
    3) Trust
    4) Company (Pty Ltd)
    For more information on the differences between each one, and the pros and cons of each, please get in touch with me, or speak to an accountant.
  • Register your business trading name with ASIC (Australian Securities and Investments Commission This is required for any business name except if using your own personal name (as a sole trader), or the full name of a company.
  • Register an ABN (Australian Business Number) – through the Australian Business Register When doing this, you do not necessarily need to register for GST, which is required only when your turnover (business income) is more than $75,000 per year. Until this point, it is your choice to charge GST or not, and there are pros and cons to each option. If you are a company or trust, this step, as well as the trading name, will be done at the same time by the accountant setting up the entity.
  • Insurance – Broadform Liability (aka public liability) is required, plus any other cover you feel is appropriate. In some industries, professional indemnity insurance is also required.
  • Professional Industry Registration. This varies depending on the industry, but professions such as accountants, car dealers, most tradesmen, etc, will have a governing body that requires a paid membership for you to legally operate as that profession. Many of these governing bodies will require a certain qualification to be obtained and maintained with ongoing professional development.
  • Set up a separate bank account in the business name (CRITICALLY IMPORTANT!!)
  • Establish who the key personnel are in your business. Even if you run this business on your own, there would still be outside people connected to your business that will ensure its success – like your accountant, bookkeeper, website developer, virtual assistant (like a remote online secretary), and any other people that support you in running your business. 


There are 2 things you need in order to be in business. A customer, and a product or service. Sounds obvious enough, but it’s necessary to really clarify who and what this is.

Write down as specifically and accurately and detailed as possible what your business will be selling, and who will be paying you for it. This also includes identifying the geographical area that your business services. At this step, it’s also necessary to keep in mind what problem you will be solving. Every transaction happens as a result of a problem being solved.


  • Decide how you will make your customer aware of what your business offers. Selling at markets? Selling online? Bricks and mortar shop in a shopping strip or centre? What advertising will you do? Social media? Website and SEO? Newspaper, radio, or other advertising? Word of mouth? The important thing here is to identify where and how your customer is most likely to see your ad.
  • Decide on a marketing budget. There are a lot of free marketing options available, but even if you plan to use mostly free marketing channels, establish a budget, no matter how small, for paid advertising – just in case the free marketing isn’t doing enough to get your business going.
  • WEBSITE – Every business in Australia should have an online presence. If not a website, then at the very least, a facebook business page. With setting up a website, be careful. Choose your developer carefully from reviews and recommendations from other clients. Basic rule of thumb is: you get what you pay for, but sometimes, even then, a developer could charge thousands of dollars, and your website will still let you down if certain things are not done right. There are free options like Weebly or Wix that you can do yourself, but just don’t expect many people to find it without being directed there specifically by you. Your website is your online shop front, and it is the first impression that most customers will get of your business. Make it a good one.
  • Set up a marketing campaign. Every marketing activity you do must be planned, carried out, and the results measured, all within the boundaries of a specific marketing campaign. To run an ad in the local newspaper every week for 2 years without knowing how effective it is, is not a marketing campaign. You can still run an ad in the local paper, but do it within a campaign. A campaign will have the following criteria: 1) A Purpose. 2) A Target Result. 3) The Method of Delivery. 4) A Time Frame. 5) A Means to Measure Results. Set up and run one campaign at a time, until you are familiar with the process and the results, then add on another campaign to run at the same time.


  • How will your business deliver your product or service? Do you have a shop? Do you work from home? Are you a mobile service? What are your hours of operation? Consider what the customer experience will be from start to finish, and what will ensure their satisfaction in the end result, where they feel they have received value for their money.
  • What standard do you expect of your products or services? How will this standard be measured and how do you determine your Quality Assurance? A chef will taste each dish. A clothing manufacturer will visibly inspect each garment. A mechanic will test each engine repair. Decide now what your QA process is, and what your minimum standard is.
  • Develop a system that your operations will run to. Even if you make bespoke furniture, and every piece is unique, there would still be a pattern or a system (a set of repeatable steps) that you would follow each and every time. Very important to have a consistent process that gets followed every time. Write down what this system is. You can start with a general overview to start with, but plan to develop this system as you go. Document as much as you can.
  • Set up your HR processes. Whether you plan to hire staff from the first day or not, establish this now, such as the pay cycle, HR policies and procedures, your default super fund, and other considerations. Even if you are running this business on your own from the start and never plan to hire any staff, you need to still treat yourself as an employee. This process gives you structure and rules to follow to ensure that the business is the boss, not the employee. 


  • The biggest killer of any business starting up for the first time is that it doesn’t have enough money to keep running before it can start paying for itself. It takes time to build up a reputation, a customer base, to get known in the marketplace for what you do. Rapid initial growth is possible when you do a big launch, but this is a flash in the pan, it will not last. Expect the initial spike, then a drop, then a slow and steady growth as your business finds its feet. Prepare for this by having outside funds available to invest in the business and prop it up to pay the overheads until the business is making enough in sales to pay for itself. This could be a business bank loan, government grant, personal savings, outside investors (shareholders?) or other means, but there needs to be something. Establish a time frame that this outside source is available, and be reasonable to allow your business time to cover the costs on its own. If time runs out and the business isn’t performing as you’d expected, what will you do then?
  • Step 1: Do your costings. For every product you make or buy, for every service you charge for, every single item that has a price tag on it, every one of them should have a costing done on it. Documented, recorded, and tracked as cost prices increase or fluctuate. If you make products to sell, or charge out your time to provide a service, calculate the cost of your time as though you were paying an employee to do the job, because one day maybe you will be. This is the second biggest killer of new businesses – not charging enough to cover all the costs. Use the Cost Price Calculator to help you (available from: Working out the necessary mark-up and price is the next step, but first, you must have accurate and complete costs to start with. Costs-of-sale, or variable costs, are the expenses that are directly connected to delivering your product or service to your customer. They will rise and fall with the sales.
  • Step 2: Establish what your overheads are. These are fixed costs that will not change or fluctuate with the level of sales, and are required for you to keep your business operating. Things like rent, insurance and registrations, phone, internet, utilities. Work out what these costs will be over 12 months.
  • Step 3: Work out your mark-up, selling prices, and break-even point. In this step, it takes a bit of going back and forth to find the ideal balance. Start with a general mark-up of 50% to 100% of your cost price (depending on the industry and expected overheads) to work out what your selling prices will be. Use the Break-Even Point Calculator (available from: to work out at what point your sales will cover the associated costs and the overheads. Bear in mind that this does not include any profit yet. Decide if the amount required in sales is possible, plausible, and reasonable to achieve. If not, adjust the mark-up and play with the different variables until you reach a figure that you are comfortable with. 
  • Step 4: Decide on your anticipated net profit. A typical satisfactory net profit (over and above personal drawings) of 10% is a good starting point. You will now be able to establish your sales targets, and all the expected figures for overheads etc becomes your expense budget. It’s important to develop and maintain a strict adherence to this budget, to stay within the financial projection you’ve established.

There will be a huge number of additional steps to get your business running smoothly on a consistent basis, and these steps will be unique to your industry, business type, size, geographical area, and your actual business and personal circumstances. But the list above provides a starting point that is applicable to every business, no matter how big or small. There may be other businesses out there that don’t have a specific marketing campaign strategy, or who haven’t done costings on all their products, or who don’t even have an operating system documented. There are lots of these businesses all over the country not doing a lot of these things. But there are also a staggering 50% of businesses that close within the first 5 years. There are no guarantees, but covering all the areas of best-practice business operation is the closest thing you can get to ensuring your business will be on the right side of that statistic.

These steps above, when they are all documented and collated into one collection, will form your business plan. This is the next chapter of running your best business, as a living business plan provides structure, direction, and continual growth and refinement to you and your business.