There is a lot of steps that go into starting a business. If you do not do it right then you will risk a lot more than a slap on the wrist. There is a number of things you need to do to protect yourself and your business when starting up.
Here are the things you need to do to ensure you are setting yourself up for success.
Decide on Your Business Name
I may share a dedicated article on choosing your business name later but for now it is important to know that whatever you come up with must not conflict with any existing names and trademarks.
Do not get hung up with choosing a business name. The name will become part of you as you grow and evolve.
We settled on the name Lemodus within one day. In a couple of hours of searching for a name that was simple, unique and stood for what we were all about, Lemodus stuck. We could have deliberated for more but realised that it is not important so was happy to run with Lemodus provided it passed the following checks.
Once you think you have come up with a name for your business, make sure you check that it is not already in use by another business. You can check this by doing a search on the ASIC business names website.
Check Social Profiles
If there are no other business names that are similar to your business name then you will want to do some social media searches to check if it is available to use or if anyone else is using it. I recommend searching Facebook, Instagram, Linkedin and Twitter. Those are the four biggest social media sites to really worry about right now.
Sometimes you will find that your desired name has been taken. This means you either settle for adding a prefix or suffix to your social handle like or pick a different name for your business.
There is also the possibility that you will be able to buy the domain from the person that owns it but be prepared to pay big money depending on the perceived value of it. I recommend you do not entertain the idea of buying a social handle. Unless you have huge supplies of money, that money could be put to much better use in your business in the very near future.
And remember, it is just a name. There is a lot more to a business that the name.
Search for any trademarks that may infringe on your business. IP Australia has an Australian Trademark search. Chances are you will be clear from any trademark issues but it is best to check either way.
You will want to check that your chosen business name does not conflict with any trademarks.
Check Domain Availability
Search on a domain name registrars whois to see if your desired domain name for your website has been registered. If you enter your desired domain and it is available then make sure you secure it.
If your business operates in a local area for example only in Australia, then make sure the domain you register is a .com.au domain. You can also register the .com variant to secure it but it isn’t overly necessary unless you wish to completely protect your brand name from potential squatters or competition.
When registering your domain name, the best place to register is with cloudflare.com. They also happen to be the cheapest in price and responsible with your information (Some other cheap registrars will sell your information to overseas website builders. Trust me, you will get spammed!).
Unfortunately cloudflare.com do not yet register .com.au domains so for now I recommend either Ventraip or better yet, their wholesale sister company Synergy Wholesale. Synergy will cost slightly more to set up but is the more affordable option provided you will be owning one or more domain names for several years.
Are All Your Names Available?
If after you have searched the business name, social profiles, necessary trademarks and domain names and everything checks out ok then you are good to register your business.
Lock down every single avenue that could allow someone to steal or impact your brand identity. That includes social profiles even if you do not plan to use these profiles straight away.
Remember you do not need to go overboard on purchasing every single possible domain name especially if your business is completely new and unknown to everyone.
A big mistake I see is people thinking once they launch, they will become a huge success. The saying goes, it takes ten years in the making to become an overnight success. People notice and pay attention to you after a lot of work.
Apply for an ABN
The next step is to register your Australian Business Number (ABN) with the government so that you can legally trade as a business. This is simply a matter of applying online.
You can register for an ABN here. This is a handy portal to register you ABN but you can also register your business name there too.
An Australian Business Number (ABN) is unique to your business. It is what allows government departments to identify you as well as other businesses to look you up and ensure you are an actual legitimate business.
You can do an ABN lookup for other businesses on the business Australia website too.
Additionally, you will want to consider whether you need to register for a Tax file number, GST and PAYG Witholdings. These are a requirement if you will earn more than $75,000 per year. If you are the slightest bit unsure, consult your accountant.
Register an AUSkey
When you are creating your ABN, register for an AUSkey too. An AUSkey is a secure login that identifies you when you use participating government online services on behalf of a business.
You can register the AUSkey all together with your ABN and business name.
Check Trade Licences
Additionally, you will want to check the Australian Business Licence and Information Service (ABLIS) website to check that you do not need to apply for any licences, regulations, council approvals and compliance requirements.
Run through the guided search to check if your business is ok to start.
Apply for a Business Name
A business name is the name your business operates under e.g. Lemodus. You need to register a business name if you conduct business under a name other than your personal name.
If you did not register you business name at the same time as your ABN then you can do this step now. To register your business name, you will need your ABN and the addresses of where your business will be operating as well as an email address.
Go to the business Australia website to register your business name.
Note that there are fees associated with registering a Business Name. You can register your business name for one or three years and it works out to be less per year if you register for three. At the end of the purchased year(s), you will need to renew the business name. This simply means you need to repay the registration fee.
As soon as the business name has been registered, you will be able to start trading.
Remember, you may be able to register or renew your business name with your accountant, your solicitor, or another business that provides online services with ASIC.
Protect Your Business IP
Do you need to protect your businesses Intellectual property (IP)? Or perhaps your idea, invention or brand already exists and is not available for you to use. Either way this requires some preparation.
There are a number of ways that you can protect your businesses IP. Here are the most common ways to protect you IP:
- Patents – A patent is a right that is granted for any device, substance, method or process that is new, inventive and useful.
- Trademarks – A trademark is used to distinguish your goods and services from those of another business.
- Design Rights – A design right helps to protect the features that make up the unique appearance of your product.
Before applying for your intellectual property right, you should do a search on the IP Australia website to make sure that it isn’t already registered.
You do not need to apply for a trademark, patent or design rights but your IP will not be protected otherwise. There are fees associated with applying for and registering for IP protection. Visit the IP Australia website to find the latest fees.
Are You Employing Staff?
It is very important to cover yourself and your employees if anything were to go wrong whether it be an accident or not.
Each state of Australia has their own employee insurances (for example: worksafe, SafeWork and Workplace Standards). This is referred to as WorkCover and protects you against any accidents in the workplace.
Search for the WorkCover provided in your state and apply for workers compensation insurance to protect your staff. If you do not have employees then you may not need WorkCover.
Superannuation (Often just called Super for short) in Australia are the arrangements put in place by the Australian Government to encourage people in Australia to accumulate funds to provide them with an income stream when they retire.
Super is compulsory for all employees of a company. If your business is set up under a partnership or sole trader type then you do not need to pay yourself super. If your business is set up as a company and you work in it then you are considered an employee. This is so even if you are the founder.
Confirm with your employee their superannuation fund that they have. If they do not yet have Super then you can choose a default fund provider for your business that your employees can use.
If you are unsure about anything to do with Super then it is best to consult your accountant.
Set up Insurance Policies
Business insurance helps protect you from financial difficulties due to legal liability, interruptions to operations, events leading to financial hardship, and more.
There are many forms of insurance you can get for your business. These insurances protect certain areas of your business. The common types of insurances you should consider getting for your business include:
- Professional liability – also called professional indemnity insurance helps protect professional advice and service-providing individuals and companies from bearing the full cost of defending against a negligence claim made by a client.
- Income protection – pays benefits to policyholders who are unable to work due to illness or accident.
- Product liability – protects against claims of personal injury or property damage caused by products sold or supplied through your business.
- Life insurance – pays out a sum of money to your family/beneficiaries in the event of your death, or if you’re diagnosed with a terminal illness.
- Public liability – protects you if you are found to be legally responsible for personal injury to a third party or damage their property.
- Stock insurance – provides cover against the loss of, or damage to, goods used as part of your stated business activity.
- Key person – life insurance which insures an employer against the death or incapacitation of a so-called key employee, usually an executive or partner.
- Motor vehicle – Insurance that covers personal liability as well as vehicle damage.
- Glass window – cover for the costs of replacing internal or external glass that is accidentally damaged or broken, including windows, mirrors or porcelain.
- Goods in transit – Protects you against financial loss or damage to your property in transit caused by an insured event while in transit by road vehicle owned or operated by you anywhere in Australia.
- Burglary – provides protection against incidents of theft to your property. This policy covers losses or damages to your property and its contents in your property.
As you can see, there are a large number of insurances you can get for your business. Most of the time insurance is optional but choosing the right insurance may mean the difference between being able to continue to operate and not if anything bad were to happen in your business.
Register business insurances through your preferred insurance provider.
Safeguard Important Business Documents
The legal documents prepared for your business are extremely important documents. Documents such as business contracts, business information, employment contracts and anything else legal or financial related should be stored in a safe and secure place.
If you still work off printed documents then it is a good idea to store these documents in a place that is safe from fire and water damage such as a fireproof filing cabinet. It is also a good idea to have multiple copies in two or more locations.
If you are like us and have a paper-less office, then make sure you backup these digital documents both in a secure location and at multiple locations e.g. your office and in the cloud. That way if either location breaks, you will have a safe backup. Do not store the backup on your computer as it can break or get stolen.
Business Is Now Set up the Right Way
Congratulations! After following the steps above, your business should now be set up safely, securely and legally. There is a lot that goes into setting up your business the right way in Australia.
For a start-up or people strapped for cash, it can be an expensive endeavour when you have to pay for all the fees. It may be especially expensive if you get a solicitor and accountant to help you with this along the way.
But fear not. Even though it may be a considerable outlay, there is almost no price to high to pay to ensure you are covered against the rough roller coaster ride you will face along your journey.
Protect yourself to eliminate risks. It is well worth it and you can rest easy that you will be able to continue to operate if anything bad were to happen tomorrow.
Now comes the fun part where you can begin building your business! Don’t forget to sign up for a Lemodus account so you can create your own business procedures and grow your business faster.
Have you followed the steps above? How did you go setting up your own business?