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Buying a business

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Starting a business from scratch means having no customers,no processes, no assets etc, however on the other hand buying an existing business could mean the hard work has already been done.  Alternatively, buying an existing business can also be a way of expanding a business you already own. In this guide we will look at what you must consider.

WHY should you consider buying a business?

There are many advantages of buying a business, which for some might be buying themselves a job. For example, if you bought a lawn mowing business with all the equipment you immediately start to earn income with existing clients.  Your chances for success are greater as the business already has runs on the board.  Even the process of asking for a loan will be easier as there is a known risk. Ideally, you will buy a business that is undervalued or has the potential to grow through your hard efforts.
There are also disadvantages, like the business was misrepresented by the previous owner, that could be turnover, reputations, debts, etc.

WHAT do you need to consider when buying a business?

It is critical that before buying a business you do your research carefully. The more information you have the better the decision.  Unless you have the skills we strongly suggest you retain the services of at least a business advisor, accountant, or lawyer. The following steps may be helpful

Where the business is conducted through a company
  1. Do a company search to verify the vendor
    ASIC Search
  2. Are all ASIC compliance requirements up-to-date?
  3. Does the company have any overseas operations?
Financial position
  1. Review the last four years’ financial statements for the business.  Analyse liabilities, inventory, and accounts receivable and payable.
  2. Understand who currently owns the business such as shares, options, warrants as well as outstanding debt instruments.
  3. Review an up-to-date copy of the business’ credit report.
  4. Does the business have a loyal customer base? For example, subscriptions, loyalty programs, etc.
  5. Have you considered the financial projections and major growth drivers of the business in the next four years?
Tax considerations
  1. What are the tax obligations of the business to be purchased?
  2. Have you obtained confirmation that all tax obligations – for example, income tax, GST, PAYG withholding, stamp duty, and payroll tax are up-to-date and paid?
  3. Obtain the last four years’ tax returns, including supporting schedules and work papers of the business, such as capital allowance schedules, business activity statements, fringe benefits tax returns, etc.
  4. Check if the business is currently being audited by the ATO or has been audited in the last four years and, if so, what the outcome was.
  5. Have you considered the stamp duty implications of the purchase of the business? (fees payable to the government associated with the purchase)
Assets that you are buying that the business currently owns
  1. Has a fixed asset register been obtained detailing all the assets being sold?
  2. Have you sighted the assets and condition of the assets being sold?
  3. Where assets are leased by the business, have you obtained copies of the leases?
  4. Are the assets adequately insured until the settlement of the purchase?
Employee obligations
  1. Have you obtained a list of the employees, including their salaries and other entitlements?
  2. Do any employees have close contacts with customers that, if they were to leave, the business would be at risk of losing customers?
  3. Are there any key staff who would be imperative to the smooth continued running of the business? Considerations should include special skill sets or knowledge.
  4. Are you aware of all employment conditions, including key workplace agreements, incentive bonus plans, staff rotation policies, disciplinary procedures, etc.?
  5. Have all outstanding employee entitlements, such as superannuation guarantee and annual leave, been accounted for?
  6. Are the WorkCover premiums up-to-date?
Inventory
  1. Does the current inventory include any obsolete stock?
  2. Has the inventory been valued at market value?
Business premises
  1. Do you have copies of all real estate lease agreements, deeds, mortgages, and any documents relevant to the premises?
  2. If the same business premises are to continue, has the vendor facilitated a lease transfer to you?
Miscellaneous
  1. Do you know why the vendor is selling?
  2. Has the vendor attempted to sell the business before?
  3. Is there a documented business plan?
  4. How complex is the business? Do you have the skills required to continue?
  5. Are the business operations subject to any government regulations? If so, are all relevant government licenses, permits or consents up-to-date?
  6. Have you done a competitive analysis?  Do you need a non-compete clause to stop the vendors from setting up in competition?
  7. Does the business have any pending or ongoing lawsuits or any recently finalised litigation cases?
  8. Have you searched the local council and other government agency records to ensure there are no plans or council orders that could disrupt the business or lead to a potential drop in sales?
  9. Have you identified the key customer and supplier contracts, and the likely impact a change of ownership might have on these agreements?
  10. Review the business’s current production, distribution, sales, and marketing strategies (including websites and social media) and the likely impact of a change of ownership.
  11. Have you considered potential issues that could negatively impact the viability of the business (e.g. changing technology, trends, etc.)?
  12. Are there any intellectual property matters to consider? For example, trademarks, licenses, patents, etc.
  13. Seek advise on other questions you should answer

HOW do I buy a business?

Once you have completed all your due diligence and you want to move ahead its time to make an offer.  Be prepared to negotiate.  Once you agree you will need a contract.  We strongly suggest you retain a lawyer in this process.  The written contract ensures that both you and the seller clearly understand what each agrees to, for what cost, and what method of payment.

You should also understand what training will be needed and, if the original owner continues to work in the business, a specified period to do a handover.

HINTS

As the last thought we suggest you:

  • Make sure this is a business you want to buy
  • Don’t assume you will not have to work hard yourself and you are buying a money train
  • Have a clear vision and plan for the future
  • Keep records of all conversations and all documents
  • Do your homework

SUMMARY – Get help from a business consultant

Buying a business can help you grow quickly but be sure to follow some strict due diligence to minimise any nasty surprises.  Your accountant or business advisor would be a good independent advisor for the purchase.

Buying a Franchise guide

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 Have you always wanted to start your own business but never had the confidence or the knowledge to do so? Is this a career change, and is it right for you? Buying a franchise may give you confidence and support in selling a proven offering. This guide will examine the pros and cons of buying a franchise and help you identify the right franchise opportunity.

A franchise is a business opportunity that allows the franchisee (possibly you) to start a business by legally using someone else’s (the Franchisor’s) brand, expertise, ideas, and processes.
Australia has three times as many franchised outlets per capita as the USA. Well-known franchises include McDonald’s, Subway and Jim’s Mowing.

Also, see our essential guides on starting and buying a business.

WHY consider buying a Franchise?

Franchises are offered in almost every industry in Australia. As an investor, you buy into an existing brand which, if you tried to set yourself up, could take years to get into the same position.

Depending on which franchise you are interested in joining, there is no guarantee that you will be accepted as a franchisee. It can be quite competitive, especially when it comes to location and also due to franchisors selecting the franchisee they believe will make the business a success.

It would help if you considered the following:
Advantages
  • Association with an established brand, reputation, product or service
  • Assistance with lease negotiations, site development, and shop fit-out
  • Assistance with buying equipment
  • Initial management training and ongoing support
  • Advertising and marketing support
  • Access to established standard procedures, operating manuals and stock control systems
  • Access to financial systems
Disadvantages
  • Less autonomy when making business decisions (franchisees generally must operate according to a standard operating manual)
  • You can only operate in a restricted territory
  • Paying ongoing fees to the Franchisor
  • Having to use specified suppliers
  • Less control if you sell your franchise; you will be required to follow certain procedures, including having your buyer approved by the Franchisor
  • Restraint of trade provisions (limiting the actions you can take) when the franchise ends
  • At the end of the agreed period, the Franchisor is not required to renew the franchise, in which case the business and its goodwill go back to the Franchisor

WHAT do I need to know about franchising?

There are three types of franchises:
  1. Business – You have the right to use the Franchisor’s intellectual property in your industry. An example is Boost Juice.
  2. Product – You sell the Franchisor’s product or service from a wholesale or retail outlet with exclusive rights within a specific area, for example, Jim’s Mowing or a Mazda dealership.
  3. Processing or manufacturing – You manufacture the product, and the Franchisor provides an essential ingredient or know-how, such as Coca-Cola.

The Franchising Code of Conduct regulates franchising in Australia. The Code is mandatory and governs the conduct of franchising participants towards one another. It covers:

  • Disclosure requirements – the Franchisor must be provided
    • When interested in acquiring a franchise
      • Information statement – 2-page document covering risks and rewards.
    • If you decide to proceed
      • Disclosure document – costs, supply restrictions, and contract details of existing and former franchisees.
      • Franchise agreement – legally binding document between you and Franchisor.
  • Good faith obligations – how you act to one another
  • Dispute resolution mechanism – if a dispute remains after three weeks, either party can refer the matter to mediation
  • Cooling-off period for potential franchisees – you cannot sign for 14 days after receiving documents, and you can terminate the agreement up to 7 days after signing
  • Procedures for ending a franchise agreement – set out the terms for termination, renewal, end of term and transfer of the franchise

Some franchise systems require their franchisees to buy certain products from them or their specified supplier, known as supply restrictions. You might have no choice about where to buy some products.

The entry price of a franchise may seem like a good deal, but there may be further costs that you have to pay to establish and run your franchise. It’s important to understand the total costs you might have to pay.

HOW do I evaluate before buying a franchise?

If you buy into a franchise, investing in advice from a lawyer, accountant, or business advisor with franchise experience will help you make a better decision. You should, however, consider the following when evaluating a franchise:

  • Consider the effect on your family and lifestyle
  • Question if the business interests you and if you are comfortable with investing
  • Research the business. This may include getting expert advice.
  • Age, size, uniqueness and reputation (including management team) of the franchise
  • Understand all costs and fees beyond the initial outlay
  • Understand franchisor directives around logos, uniforms, and future capital investments like a compulsory store refresh
  • Be aware of what marketing support is provided and what your contribution will be towards that
  • Ask to see demonstrations of processes or technology
  • Understand how area territories work and if they are exclusive; thus, you will understand the competition from your franchise. Location is important.
  • Understand what training is available
  • Is the Franchisor a member of the Franchise Council of Australia, as this imposes certain ethical standards
  • Ensure what you receive in writing matches what you have been told verbally
  • Speak with existing and past franchisees to see if the opportunity has lived up to expectations
    • What’s the work like?
    • Any unexpected costs?
    • How is the supply of products or services?
    • What problems have you encountered?
    • How supportive is the Franchisor?
    • How was the training?
    • Was it a good investment?
  • Ask about compliance checks performed by a franchisor
  • Consider what your exit strategy looks like

HINTS

Don’t assume the franchises will be a success.

Don’t assume you will not have to work hard in the business.

Understand your reputation is affected by the Franchisor, for example, 7Eleven underpaying employees.

Guides from the ACCC to help franchisees and prospective franchisees understand some of their rights and responsibilities under the Franchising Code of Conduct. https://www.accc.gov.au/publications/franchising-what-you-need-to-know

Franchise start-up checklist https://www.accc.gov.au/system/files/The%20franchisee%20manual__Mar%202019.pdf

Free pre-entry franchise education program https://www.franchise-ed.org.au/online-courses/pre-entry-franchise-education/

The Franchise Council of Australia has some further resources on this subject. https://www.franchise.org.au/

The Australian Small Business and Family Enterprise Ombudsman (ASBFEO) can assist in resolving franchising disputes. https://www.asbfeo.gov.au/franchising-disputes

SUMMARY – buying a brand, expertise, and processes

Buying a franchise can be a great way of starting your own small business. It comes with the security of an established brand, expertise, ideas, and processes. However, you will have less autonomy. The mandatory industry franchise code of conduct helps to protect all parties and provides a mechanism to resolve disputes. Before buying a franchise, do your homework carefully and consider using the services of an expert in franchising. 

Wireless Security Camera buying guide

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As a small business owner, you watch over your business carefully. You ensure process is working, you count the money etc. However, do you actually watch over your business literally when you are not there?  In this wireless security camera buying guide, we will look at why you would install one, what you need to know and how to make a buying decision.

A wireless security camera is a surveillance camera that can capture video images and transmit those images with no wires back to a recording devise either on premise or to the cloud. A power cable or battery will be required to provide electricity.

WHY should you consider a surveillance camera?

The ability to watch what is going on remotely within your business means you are always in the know.

Once you may have installed a burglar alarm to protect your business or home, a security camera can do so much more.

Benefits of installing a wireless security camera:

Deterring crime– A thief does not want to be caught on video

Video proof – If an incident does occur, footage can be reviewed, and police can use images

Check up on the business remotely – Is the store busy at the moment

Employee safety– Watch and review staff member behaviour to ensure safety procedures are being followed.

Insurance claims – Camera footage can validate a claim, or the camera may lead to a discount

Notification – Be alerted a customer has entered your showroom

Progress or conditions – What is the weather or progress on a building site.

WHAT do you need to know about wireless security cameras?

There are wireless and wired camera solutions. A wireless camera solution uses a wireless network solution such as your Wi-Fi network to transport the video. A wireless camera may also have a battery enabling it to be completely wireless. A wired camera will require you to install cables running from a central recording box as well as power cables.

A wireless camera will record vision once motion is detected.

Advantages of wireless over wired camera
  • No cables need to be run back to a central recorder
  • Video surveillance can be stored in the cloud. This means images can be easily accessed from anywhere, and even if thieves remove the camera, images are preserved.
  • Installation is simpler, and a completely wireless solution may give you additional placement options to increase visibility.
  • Cables cannot be cut.
  • DIY solution. An electrician or tradesman is unlikely to be required.

Disadvantages include possible limits to live viewing and maximum resolution.

Wireless Cameras come in 3 forms:
  1. Battery operated mobile networked cameras – This product can be placed anywhere with mobile phone reception and will run until its battery runs out. The video vision is transmitted back to the cloud via mobile data.  Perfect for surveillance of a building site with no internet or power.
  2. Battery operated Wi-Fi Cameras – This is the most common type of camera which will use W-Fi to communicate back to the cloud or a base station and a battery to power the unit. This solution is truly wireless.
  3. Mains connected Wi-Fi cameras – Mains power is required, but the video signal is transferred via Wi-Fi. With a power point likely to be close by, this type of camera will allow continuous recording, which requires more electricity.

An optional Solar panel may be available to power and battery-operated charge cameras, potentially removing the need to remove the camera for mains recharging.

Wi-Fi coverage needs to be good – If you mount a camera outdoors, chances are the Wi-Fi coverage will be poor. Wireless cameras need good coverage to work properly. Wi-Fi congestion can also be an issue. Video uses a lot of bandwidth. If there is a lot of other internet traffic, the transfer of video may be interrupted. Some vendors use a dedicated Wi-Fi network to transfer the footage, but most use your shared Wi-Fi network. Most cameras will also have an SD card slot where a storage card can be inserted. This allows for local storage of images and acts as a backup if cloud storage is interrupted or not used.

All wireless cameras will be supported by a free smartphone app. This App will enable you to receive alerts, live view and watch historical recordings. The App will also allow you to customise camera settings.  Depending on features, you can also trigger alarms, turn on a spotlight and engage in a 2-way conversation.

Cloud storage enables recorded footage to be stored off-site and accessed from anywhere.  Vendor-specific, this may be free, or a fee may apply.

HOW do I use and choose a wireless security camera?

Wireless camera setup

The setup of a wireless camera is very much a DIY exercise:

  1. Connect the camera to power with the supplied USB cable. For battery models, this will charge the battery.
  2. Download the App for your smartphone.
  3. Open the App and follow the instructions.
  4. Select suitable locations for your camera, considering whether the camera can capture what you want to record and the Wi-Fi signal is strong enough.
  5. Use the App to customise settings (such as alerts) and enable cloud recording if applicable.
  6. Familiarise yourself with playback settings and how you can view live video versus recorded video.

Features you should consider when buying a wired security camera:

Outdoor or indoor– If the camera is located outside, it will need to be weatherproof|
Wi-Fi vs Mobile of 4G cameras – as discussed above
Camera types – beyond the power choice options (battery or mains power), cameras can be bought as a fixed direction or a pan & tilt model. The fixed version view can only be changed manually versus a pan and tilt model that can be rotated to change the view remotely. Some cameras will offer optical zoom, which will provide an enlarged picture without deteriorating resolution.
Battery – On battery models, what is the expected operating time between recharges
Resolution of the camera – The higher the resolution, the better the quality of the picture and the greater ability to zoom in digitally to see details such as faces and number plates. You can choose between Standard Definition (SD), High definition (Full HD) or Ultra High Definition (UHD or 4K). Each resolution jump is 4 x the number of pixels or dots.
Viewing angle of the camera – This refers to the field of vision of a camera. The larger the number represented in degrees means the camera will record a wider view in tight locations. A camera with a 90-degree viewing angle would see everything 45 degrees left and right from the centre.
Low light – Also referred to as night vision, is the cameras ability to see in the dark.  Most modern cameras will support this but look for the distance from the camera it will see. E.g. 10m.
Technology to stop false alerts – Normally based on measuring a heat source in the camera view, this technology is critical in reducing false alerts, especially on a windy night with moving vegetation. Alerts can also be programmed only to occur at certain times, like outside business hours.
Mounting kits – A magnetic mount will allow easy removal for recharging. Mounting straps allow easy installation on tree branches or poles.
Other –  various other features may be attractive to you like Siren, strobe, 2-way audio or a spotlight
Remote functionality of an App – A smartphone app will allow you to receive security alerts as well as provide live views from anywhere with internet coverage.  This can potentially remove the need for expensive security monitoring with you having the ability to review and call the police if necessary. The App will also notify you of low batteries. Multiple people can be given access to share the responsibility.
Storage – Camera’s or base stations will support an SD card to record vision on-premise. In addition, cloud backup is available from most vendors on various pay per use plans (some free).
Solar Panel – Is it available for your model, and can it be installed to orientate to the north?
Solution price and bundle options – Once you choose a brand, you will have to stay with that brand unless you start again.  Price will increase with functionality, and we do recommend you go with a known brand.  Once you know the number of cameras you need, you may buy a bundle to suit. Different compatible camera types can be purchased and added separately, assuming you have available channels.

HINTS

Once you commit to a specific brand of cameras, you cannot mix and match different brands of cameras as they will not work on the same smartphone App.  You must either start again with a new vendor or run multiple Apps.

Use the QR code to easily find the right App.

Handy features include the ability to mask a section so no video is recorded or no motion alerts triggered within a specific part of the field of view.

Are Wired security camera buying guide can be found here.

SUMMARY – Wireless Security Camera

A wireless security camera allows you to keep an eye on your business 24/7. The system can act as a burglar alarm, evidence of an event or even safety monitoring. The available solutions are simple to install yourself and can be located anywhere you have a Wi-Fi signal. Via a smartphone App you can receive movement alerts and also view cameras in real-time.  This access can be shared with others.

A configurable solution allows you to mix and match different cameras to suit your requirements, including totally wireless products that use the sun for power and the Mobile phone network.

Wireless security cameras can be purchased directly from vendors or from office supply, hardware and electrical retailers.

How to start a small business?

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To start a small business is most likely a labour of love. Sometimes it is turning a hobby or passion into a business. Unfortunately, in some cases, some decisions are made with the heart rather than the head. Poor planning or operational choices made for the wrong reasons can easily see a business end all too quickly.

We certainly do not want to talk you out of this amazing journey, as many successful millionaires grew from a small business. The most important thing you can do here is plan well, understand the effect it will have on you and your family, and understand the implications if it does not work. This guide will give you a process to work through to maximise your chance of success.

There are more than two million small businesses in Australia, most with a turnover of less than $10 million per year and less than 20 staff. The average small business has three staff or fewer.

WHAT is important to consider before you start a small business?

Here at Small Business answers, we want to bring you the best-unbiased advice. To save you visiting many different websites, we have assembled easy-to-read guides on the most common questions and processes you must follow to start a small business. This information is broken down into easy categories, as seen at the top of this page. You can quickly find information on the subject you are looking for by using the quick search box to the right.

The basic steps to start a small business:

  1. Consider if you are really ready
    2. Evaluate your business idea
    3. Build a business plan
    4. Choose how you want your business structured
    5. Check your government/legal obligations
    6. Consider what support you will need from others
    7. Figure out your finances
    8. Promote your business

As part of your research you should visit a handy guide produced by the Australian government. Here you will find information to help you work through the steps such as being ready, making decisions, planning, etc. You can even find information on government grants, events, and training that may help you get started.

A checklist is also available that will guide you through the most important factors you need to consider. This includes checking your rationale for starting the business, determining the right business structure, tax implications, and insurance. There are tick boxes for you to check off, which will put you in a much better and safer position in the long run.
Read our essential guides on business structure, tax, GST, record keeping, marketing, building a website, and insurance, or just explore our many guides designed to make your decision-making easier.

HOW do you write a business plan to help start a business:

What is a business plan?

Starting a business is so much more than a good idea and a business plan is a document that makes you go through the entire process including financials. In many cases, a bank, investor, or maybe your partner will require a business plan to justify supporting you in this new endeavour.

A business plan will normally include the following:
  • A summary of what your business will do
  • Where will it be located
  • If it will employ staff, what will that structure look like?
  • What products and services will you offer, where and for how much?
  • How will you manage risk including insurances?
  • Are there legal considerations?
  • What do you need to buy in the way of fixed equipment like a computer or inventory to sell or make something?
  • What hours will you be open and how will you collect payment?
  • How big is the market potential and do you have competitors?
  • Who is your customer and where are they?
  • A list of Strengths, Weaknesses, Opportunities, and Threats of your business (SWOT).
  • What is your Sales and Marketing Strategy?
  • What is your vision and what objectives need to be met to get there?
  • How much money do you need to start your business?
  • How much revenue do you believe you can make?
  • Will you make a profit or a loss?
  • At what point will you actually pay yourself
  • When do you plan to break even?
  • What information have you used to back up these other questions?

It all sounds a bit daunting! But if you work through these points, you will have a much clearer picture rather than starting a business on a gut reaction. Downloading this government business plan how to guide will really make the whole process that much easier.

HINT

Another great place to consider learning more is via a TAFE course, where you will benefit from a face-to-face discussion on the subject.

The great feature of the Small Business Answers website is we are pulling together the most frequently asked questions in starting or running a small business. Please continue to visit this site as we continually update with new information to help you succeed.

SUMMARY – Gather templates and checklists

Make sure you a ready to start a small business and have done your homework on the opportunity. Use some of the fantastic templates and checklists available to help you build out a business plan.

Starting a business is just the beginning of your journey, and you should be prepared to work hard and deal with the unexpected. There is lots to learn and a high level of responsibility, especially if you hire staff. Owning your own business is not easy, but being your own boss will also bring many rewards and flexibility.

Social Media to engage customers

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Most people are on social media. Indeed for many Australians, it has become an obsession to the point that downtime should almost be renamed social media time. For this reason, social is a big opportunity for small businesses, and this guide will look at it objectively and advise you on how to make the most of it.

Social media refers to websites and applications that allow people to share content quickly, efficiently, and in real-time. Many people define social media as apps on their smartphones. The most common sites today in Australia include Facebook, YouTube, Instagram, LinkedIn and Snapchat.

When the likes of Facebook started their business, they allowed posting with few restrictions and allowed all followers to see those posts. Social sites need to generate income themselves, so if you are a commercial operation, they want you to spend money to talk to your audience. For example, If 100 people follow your business and you write a post saying you have a big sale this weekend, probably only three people will see that message in their social feed. If you pay $100 to boost your post, 3,000 people would have the post in their feed. So, unfortunately, social media is not a free form of advertising.

An organic post is a post that gets its distribution simply by being on the social platform.
Boosted post refers to when money is paid to reach a larger audience for your post.

WHY should I use Social Media?

The key advantage of social media advertising is targeting a customer. If you use traditional advertising like an advertisement in a local newspaper, you are advertising to everyone who reads that newspaper. With social, you can specifically target an audience. For example, you could target females, 18-30, who drive a car and live in your town.

Social media will help build your brand and provide a link to your website, driving additional traffic.

Social media is more cost-effective in reaching a customer than traditional advertising, but it has a very short attention span. If not engaging, your posts can easily be missed.

WHAT you should know about Social media

When businesses first used social media to reach their customers, there was not much competition. This is very different now, and as it is a bidding-based system, if you have multiple parties bidding for the same audience at the same time, this drives prices up.

Social media is not just about advertising. You can use it to find candidates for your business through sites like LinkedIn and provide video tutorials on using your products like Youtube.

The ideal situation you find yourself in is that after you post some content, your audience is so engaged they repost to their connected audience. If this process goes exceptionally well, it is referred to as a viral post.

Social media is a 2-way platform. Just as you can talk to customers, they can easily talk back. As this is a public medium, everyone will see the comments. Unless the comments are deemed by general society as inappropriate, you cannot delete them. The positive here for your business is you get instant feedback and suggestions. The counter to this is people will speak their mind, especially if they are unhappy with you. You do have the opportunity of turning this around by engaging the customer publically or privately to resolve their issues. The net effect here is if you use social media, you must also monitor it and realise it is not a set and forget medium.

HOW can I promote my business using social media?

Before you start, you need a plan or a social media strategy. This plan will outline how you will use social media, your ideal outcome, and what types of content you will produce. Also very important is to have a schedule of how often and who will do the posting. Remember, it is not the most posts that win. Rather, the posts that are most interesting to the customer and shared by the customer. Other considerations for your strategy should include considering seasonal events like Christmas and whether your efforts will generate sales.

To post on social media, we suggest the following steps.
  1. Decide on which platform you will use
    • Facebook – social sharing
    • YouTube – videos
    • Instagram – pictures
    • LinkedIn – business and recruitment
    • Snapchat – users send and receive self-destructing photos and videos
  2. Visit the platform site and learn about their offering and the free tools they provide to assist you.
  3. Establish a business profile on the platform
  4. Write your first post
  5. Decide if you will amplify the distribution by paying money to boost the post to more people. If you do, you will have the option to target by factors like demographics, location, and interests.
  6. Be ready to respond to comments from your post (if you do not, customers quickly form the opinion you do not care)
  7. Post more content and repeat.

HINT

Always include an image.

You must be active every day with interesting content if you want to keep customers engaged. Interesting content is content the customer would find interesting, not what you might find interesting, and it should also be relevant—no point in posting about International Happy Day if it has no relevance to your product.

Social media is bound by advertising rules, and any false or misleading advertising will be subject to consumer law. See our essential guide on consumer law.

SUMMARY – engaging social content

Social media is great for economically building a brand and promoting your business to a targeted audience. You must commit to the media ongoing and create content that engages the end-user. Boosting content will help you reach a greater audience. You should be aware and available to reply to comments.

Close a business

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We understand this is a difficult time for you, and this guide will take you through the steps you should consider to close a business.

The most common reasons for closing a business include the business is no longer viable, costs exceeding income, or you wish to retire, and the business has no value without you.

WHY should you close a business?

There is a fine balance between the emotional desire to be successful and the reality of financial stability.  A decision to close your business might not be needed if you get some help from a business advisor or an accountant.  Similarly, they may also recommend closing your business is the best action. Unfortunately, the truth can be the most painful thing to accept.

Recognising that it is time to close your business may save you from further debt that will still need to be repaid.

If you are closing your business to retire, this can be an exciting time to start a new chapter in your life.

If you are in doubt, these are key indicators that should encourage you to question your business viability.
  • You feel you should close
  • You are losing money
  • Your goals are not being met
  • Many customers but no profits
  • Your product or service is not needed or wanted
  • Nothing you have tried has worked
  • Marketing is making no difference
  • Competitors dominate your industry
  • No long-term customers
  • Your dream is not the reality
  • Home and work life is suffering
  • Employees are leaving
  • Your health is suffering
  • Trouble sleeping
  • You have become negative and angry

WHAT are the steps to close a business?

Once you have decided to close your business, it is best if you work on a plan to achieve this. 

The first step is to decide on a date that will allow you to accomplish the following tasks:
  1. Notify your employees.  This will be difficult for them as well, and you will need to pay out any outstanding wages and leave. Also, ensure that the employee’s superannuation has been paid.
  2. Suppliers. Let them know the date and plan to pay any outstanding debts.
  3. Notify your customers.  It would be best if you showed those who have been loyal to you the courtesy of letting them know you can no longer supply them.  This could be done with a sign on your website or a phone call.  It may also be an opportunity to sell off any remaining stock or assets.
  4. Pay outstanding bills.
  5. Cancel services, including the Internet, power, bank accounts, web hosting, social media accounts, etc.
  6. Sell your business assets.  These can include stock, fixtures, tools, machinery, intellectual property and domain names.
  7. End lease agreements.  This could be for machinery or property but remember, based on the terms you have in your lease agreement, you may still be obliged to continue payments until the end of the lease term.
  8. Taxation responsibilities.  You must pay outstanding taxation debts, including income tax, GST and capital gains. There is also a requirement for you to post final tax returns and a final GST activity statement.
  9. Cancel your ABN. https://www.abr.gov.au/business-super-funds-charities/updating-or-cancelling-your-abn/cancel-your-abn
  10. Cancel your business name. https://asic.gov.au/for-business/cancel-your-business-name/
  11. Keep business records.  Records should be kept for a minimum of 5 years after you close.

HOW can I get help to liquidate?

The following resources may be useful in helping with this process:

Your accountant and or business advisor can assist you with the decisions to keep, close or sell a business.  Business advisors can be found here https://www.business.gov.au/expertise-and-advice.

Suppose a registered company becomes insolvent and goes into liquidation. In that case, a liquidator must be appointed to take control of the company so that its affairs can be wound up in an orderly and fair way for the benefit of all creditors. More details on this can be found here https://asic.gov.au/regulatory-resources/insolvency/insolvency-information-for-directors-employees-creditors-and-shareholders/.

Auction houses like Grays Online can provide a means to sell off your excess stock and assets.

Bankruptcy is a legal process when you are unable to pay your debts. It is a means that allows you a fresh start but may affect your ability to get credit, travel overseas and gain future employment. More details  https://www.afsa.gov.au/insolvency/cant-pay-my-debts/what-bankruptcy

National debt helpline provides free financial counselling  https://ndh.org.au/ or 1800 007 007

Crisis support – Lifeline.org.au  or 13 11 14

Mental health – Beyondblue.org.au or 1300 22 4636

Family dispute resolution – Relationships Australia https://www.relationships.org.au/what-we-do/services/family-dispute-resolution

HINTS

The Australian tax office provides a business viability tool to help determine if a business is still viable.  https://www.ato.gov.au/Calculators-and-tools/Business-viability-assessment-tool/

SUMMARY – a big decision for any small business owner

Closing a business is a big decision for any small business owner. Be sure that you are making the right decisions and not emotional ones. If your business is not going well, be careful in taking on additional debt.  Create a plan around closing your business and make sure you do the best for those who have supported you, like employees, customers and suppliers.  Don’t be afraid of asking for help. There are several free services to support you.

Computer Monitor for small business

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Are you staring at a laptop screen trying to work on a large spreadsheet? An attached monitor may be just the tool you need to increase your productivity. But which one? A good basic monitor sells for around $400, but some the same size might be $1000 more. Why? This guide will explain what you need to know about a computer monitor and help you understand the key features you should consider when making your buying decision.

A computer monitor, screen or display is a piece of hardware that displays the video and graphics information generated by a connected computer. Monitors are like TVs but usually display information at a much higher resolution, showing more detail and making them easier to read.

WHY should I buy a better computer display?

If you have a desktop, then you need one. If you buy a laptop, it is a handy addition (for more information on choosing a desktop or laptop, see our PC guide).

Most laptops and desktop computers can run more than one display, and the display can be spanned across several external monitors. Additionally, a laptop display can be mirrored or “cloned” to appear on an external monitor.

Having one or several monitors expands the workspace for a variety of tasks. An external monitor can deliver improved image quality and much more screen real estate if you have a small laptop.

Getting a new monitor is a bit like getting a new TV. It will look better than the old one with a sharper picture and better colours. Generally speaking, the more you pay for a monitor, the better-quality image you will get.

WHAT do I need to know about computer screens?

The size of a monitor is measured in inches from one corner of the screen to the other, not including the outer casing.

The monitor will require its own power supply and will need a connection cable to connect to a computer.

The connection options include:
  • HDMI – preferred method, same modern standard as a TV. Both a modern PC and monitor should have one. It will carry video and audio and support up to 4K video.
  • DVI – older standard for HD video
  • VGA – old standard using those blue plugs with pins
  • Thunderbolt 3 (USB Type C) – high-speed cable with a very small connector that will carry data, ethernet, power, video, and audio. Sometimes the only video connection port on a smaller laptop. 
  • USB – USB 3.0 is the modern standard, and although it can carry video, it generally does not.
  • Wireless – normally referred to as screen sharing or Miracast.  It uses a direct Wi-Fi connection to stream your PC image normally to a TV.

A monitor may not run to its best ability if you do not load the drivers on your PC for that monitor. Look for some instructions in the box.

You can adjust the settings of the monitor display, although most don’t. If you work with graphics, photos or video, you should explore these adjustments.

Some monitor brands provide software that will turn one monitor into many. When using a very big screen, you can trick the PC into thinking it is looking at different screens even though they are on one screen. Useful when you need to keep certain apps open all the time, and you don’t want to be resizing windows.

HOW do I choose a computer monitor?

Computer monitors can be bought online, at Officeworks and the likes of JB-HiFi and Harvey Norman. Not knowing your particular needs, it is hard to recommend a monitor beyond suggesting a 27-inch monitor with Full HD resolution.

When choosing, you should consider:
  • Size – measured in inches. The screen becomes a much longer rectangle the larger the size. It allows you to do more on one screen. As an alternative, some people may buy two screens to get the same effect.
  • Resolution – The more pixels, the better the picture. 1920 pixels by 1080 pixels is Full HD (1K) or FHD, double that is QHD (2K) and four times is 4K
  • Response times – (preferred by gamers) is the time it takes to change a pixel colour. Shorter is better, and it reduces the blur effect when watching fast action like sport on the screen.
  • Colour reproduction – Panel and processor quality will affect colour reproduction. Better is more expensive but simply look at quality instore before buying. It is important for those working with images that consider a monitor certified as colour accurate.
  • Base Mount – is the base adjustable, and how will that work with the way you will look at it.
  • Thunderbolt 3 laptop power – Some monitors support powering your laptop from the monitor. This same cable will carry the video and USB traffic (keyboard, mouse, USB drive etc.) Thus, only one cable is required for everything simplifying laptop power and connection to all your other devices.
  • Touchscreen – If the monitor supports this feature, you can control actions with your fingers on the screen.
  • Inbuilt speakers – allows sound to be projected from inbuilt speakers in the monitor.
  • Microphone and Camera – If installed it helps with video calling.

HINTS

Visit the Gadgetguy website to see reviews and recommendations on various monitors.

If you need to connect an older cable to a newer port (such as HDMI to VGA), there are adapters for this purpose.

Watch out for specials. As this is such a competitive market they are always around and will save you some money.

SUMMARY – best computer monitor for your small business

Having a good computer monitor will help you be more productive and enable you to see more clearly. When buying, you should have some sort of budget in mind then see the size you can get for the quality and resolution of the picture you need for your job. Ensure you have the right cables and that the display stand will work with your needs.

Bad debt – How to avoid it!

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You gave your customer 30 days to pay, but now 60 days have passed without payment. Maybe there is a dispute. Are your cash reserves running dry because the invoices are not being paid? This guide will look at the importance of worrying about getting paid on time and how you can chase up and avoid bad debt.

Bad debt occurs when the payment of an invoice is estimated to be uncollectible. Bad debt is a contingency that must be accounted for by small businesses that extend credit terms to customers when they issue an invoice, as there is always a risk that payment will not be received.

WHY should I worry about unpaid invoices?

It does not matter if it is your best friend that has not paid you or it is a large corporation. If you cannot collect payment promptly, it will affect your cash flow and profitability, and your business will suffer. This situation is further compounded if you have already paid your costs associated with the invoice, such as materials of wages. Essentially you are lending money to your customer, and if you do not have the cash flow yourself, you may be paying interest on a bank overdraft/loan until this invoice is paid, further eating into your profits.

WHAT can I do to prevent bad debt?

When deciding to offer credit to customers, any action you can take upfront to reduce the chance of bad debt is a much simpler process than collecting money from someone who does not want to or cannot pay you.

To prevent bad debts and protect your business ideally you should:
  • Only send out goods or provide services after customers pay their bill
  • Provide simple and clear payment options
  • Invoice customers quickly and properly
  • Give discounts for paying on time or early
  • If you intend to provide credit you should research the customer:
    • Do a credit check (try Equifax, Onedeck or creditorwatch) and ask the customer for references
    • Create a business contract with clear terms and conditions using the help of legal advice
    • Set up effective payment terms
Have a process to manage payments and debt recovery, a good accounting package will help with this:
  • Check contract terms to see when payments are due
  • Ensure you have the right contact details
  • Contact the customer in writing to request payment
  • Keep records of all customer correspondence
  • Set up regular payment reminders (some accounting packages will have an automated system for this)
  • Telephone the customer
  • Send a formal letter of demand

Most important is to create sensible limits on the credit you offer to your customers that they will be able to repay easily.

To prevent bad debts, a factoring company will buy your outstanding invoices from you for a reduced cost and then chase up the debt themselves. It is a fast way to get cash but at a high price as they take on the bad debt risk. (It is unlikely they will not just buy the bad ones)

HOW to deal with bad debt?

The first step is to understand the cause of the debt:
  • How long has it been outstanding?
  • How much is owed?
  • What is the invoice for?
  • Is the invoice disputed?
  •  Is the debtor still trading?
  • How long have you been doing business together?
  • Does the debtor have a history of late payment, is this different to normal?
  • What credit agreement do you have with them and did they sign a Director’s Guarantee?

The sooner you take action to recover your overdue debt, the more likely you will recover your money.

If a customer has not paid you after various attempts, you must decide if the debt owed is worth the additional effort to collect it. For example, $100 is possibly not worth it, but $10,000 is. You must consider your time and cost to recover as well as the likelihood of the debtor paying.

The following avenues can help recover debt:
  • Debt collection agencies – will attempt to collect the debt on your behalf for a percentage of the debt owed.
  • Legal action – a lawyer can issue a lawyers’ letter of demand or start court proceedings.  An online letter service is relatively cheap but going to court is not, however, the recovery costs can be added to the debt.  Court proceedings will enforce an outcome and affect a debtor’s credit rating.
  • Small claims tribunal – provides mediation and a legally binding solution without having to involve lawyers and courts. Is good for resolving disputes. https://www.accc.gov.au/contact-us/other-helpful-agencies/small-claims-tribunals
  • Court – courts will decide on disputes where the amount owed is too high for a small claims tribunal. Consider using a lawyer if your case goes to courts as procedures are more formal and complicated.
  • Community legal centres – can assist with letter writing and filling out court forms https://clcs.org.au/
  • Small Business Commissioner or Ombudsman – advice on how to recover debts and subsidised or low-cost dispute resolution https://www.asbfeo.gov.au/disputesupport

As a small business, you can also take out Trade Credit Insurance which allows a business to insure themselves against bad debts.

As a business owner, you should consider some sort of provision (put money aside) for bad debts, and this is essentially self-insurance. From an accounting perspective, unpaid bad debt can be an allowable deduction as long as it was included as assessable income in the present or even a previous income year and that it is written off as “uncollectable” in the same year that a deduction is claimed.

HINTS

Unfortunately, some scammers ask your clients to pay your recent invoice into a new bank account, being the scammers’ account. Ensure your clients understand that you would not change your payment details, and in the unlikely event you did that, there would be a very clear and robust process in writing and over the phone.

If the business you are dealing with is in administration, liquidation or deregistered, they may not have the ability to pay you. Check whether a company is in liquidation or deregistered on ASIC Registers. https://asic.gov.au/online-services/search-asics-registers/

Let your customer know you plan to take legal action or use a debt collector. This may have an effect without the cost.

SUMMARY – fast action to recover debts

If you decide to offer credit to your customers, you can find yourself in a situation where a customer is refusing or cannot pay your invoice. This is known as bad debt. It is best to have a plan to avoid bad debt, but if it occurs, fast action brings the best results. Your best chance of recovery after your efforts have failed is via a small claims tribunal, using a debt collector or the services of a lawyer.

Register a Business Name

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Your business name is your reputation, and hopefully, it is worth something over time. The last thing you want is to lose it or find someone else who owns it. This guide will cover the process of registering a business name in Australia.

A business name is a name your business operates under. You need to register a name if you conduct business under a name other than your own.

WHY do I need to Register my Business name?

If you do not register your name, you may find someone is already using it, or someone else could register it. Then you would have to find a new name and waste any effort you have already taken establishing your name. There is also the potential for legal action against you.

WHAT you need to do first – Search business names

After you have chosen a potential name, your first port of call should be the Australian Business Name index. ttps://connectonline.asic.gov.au/RegistrySearch/faces/landing/bn/SearchBnRegisters.jspx?_adf.ctrl-state=q7ueeovpl_45

Here you must select “business names index” then enter your potential name in a search box. You will then be presented with a search result. Here you will see if the name is already taken or available.

Your next step should be a simple search on the internet to see if anyone else is using your name and, if so, in what way.

Assuming no one has already used it and your name is not close to someone else’s, you can now apply to register that name. Note some words like “Bank” or “Royal” cannot be used as they might mislead people about your activities.

HOW to register a business name:

  1. Determine your business structure.  Be sure to read our essential guide on choosing a Business structure
  2. Apply for an ABN (Australian Business Number) https://asic.gov.au/for-business/registering-a-business-name/before-you-register-a-business-name/australian-business-number/
    You may have 2 or more business names registered to the same ABN as long as the business structure does not change.
  3. Sign into ASIC Connect. Steps to register can be found here https://asic.gov.au/online-services/business-names/#steps-to-register
  4.  Once logged in Select ‘Business name’ from the drop-down box
  5.  You will now be required to enter your ABN, the proposed name, how many years you want to register for, and your details
  6. Review the information you have entered, most importantly did you enter your proposed name correctly?
  7. Pay for the application and wait for your registration to be processed

HINTS

Make sure you have the right spelling!

The cost of registering a business name can be found here. tps://asic.gov.au/for-business/payments-fees-and-invoices/payment-options/business-name-fees-and-payment-options/

You must have an Australian registered business name if you wish to register an Australian internet domain name like yourbusiness@com.au.

SUMMARY – Your Brand

Selecting a business name gives you an identity. Registering means you are the sole owner of the name and can also register an Australian internet domain name.

Video Production and Editing

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Video is a very powerful medium. We spend so much time consuming it ourselves and the internet has only increased that.  A video can tell a story so much better and can help your business stand out from the crowd. In this guide, we will look at why you should consider using video. What is involved in video production and editing and how you might go about producing a video.

Corporate or business video production is the end-to-end process of making a professional video for communication to external or internal audiences. Content may be used as promotional videos and video marketing, recruiting videos, and for learning and development, or sales.

WHY should you consider using video?

The exponential rise in video adoption across the internet – especially on social media – has inspired businesses to implement video in ever-new and exciting ways. From sales and marketing, right through to internal communications, training and human resources, organisational functions are transforming the way teams communicate with engaging, effective business videos.

Viewers retain 95% of a message when they watch it in a video, compared to only 10% when reading text. (Source: Insivia)
78% of people watch online videos every week, with 55% of viewers watching videos every day. (Source: HubSpot)
By 2022, online videos will make up over 82% of all consumer internet traffic – 15 times higher than in 2017. (Source: Cisco)
90% of users say that product videos are helpful in the decision process. (Source: HubSpot)

Videos can be made to help convey the following:
  • How-to videos
  • Tips & tricks content
  • Recorded webinars
  • Behind the scenes videos
  • Customer testimonials
  • Stories that showcase your products or services
  • Business overview

WHAT is involved in video production and editing?

The thought of filming a video can be quite intimidating whether it be a camera pointed in your face or all the equipment perceived to be needed to make it look professional.

To end up with a successful video that will help your business there are 4 key steps:

  1. Planning (or preproduction)
  2. Shooting
  3. Editing
  4. Distributing
Planning

This is the most important step. Long before a camera is even switched on you need to be clear on why you want a video and then come up with the idea for the video. Part of this planning process is also understanding how you will enable people to see the video which might affect how long it is and the creative idea. Next step is to create a storyboard or video plan template which may or may not contain a script depending on how structured the video will be.  This process will help you determine what shots you need to ensure you record everything you need to convey your message. Download a video plan template here.

Shooting

This is where you will shoot or record what you have outlined in your video plan template. Ensure your presenters or interview subjects know what is expected of them and at your selected location look for an interesting backdrop.  Another key consideration is lighting which can be provided by natural light or using artificial lighting.  Never put the sun behind your subject.

Your talent may not even be the star of your video it may be a product or a process. Gathering what is referred to as B roll footage enables other shots to be inserted during editing whilst you still hear the presenters voice.  Stock B roll footage may also be purchased if it is impractical to get the shot.

Before you finish filming ensure both your video and sound is good by playing it back as it will be much easier and potentially cheaper to do a second take then, as not all mistakes can be corrected in editing.

Editing

Editing is the process of taking all the footage you have taken and assembling them in a logical sequence to convey your message. To edit video a video editing software package is required. Free trials are available to help you find one that suits. If you have no experience then you can learn to do this but it does take a certain skill to deliver a professional result.  Be careful not to over-edit with too many transitions between shots and effects. 

The soundtrack is just as important as the video, music and effects can be a useful addition to the recorded speech. Additional voice overs can also be added at this time.

Distribution

Now that you have a video it is time to get people to watch it.  This might be used only for a private audience like training through to anyone on the internet.  Consider who will see it and who should not.  If making the video public consider your audience and where best to display the video which may be multiple places. Some ideas include your website, Facebook, YouTube, Instagram, Twitter and LinkedIn.

HOW do I create a video?

Now that you understand what is involved you may be feeling confident and you may not. You have some options.

The first option is to outsource the entire project.  A video production company can do everything for you and a short corporate video will probably cost around $5,000 to $10,000.

If you have experience or are feeling confident you can have a go at doing the entire production yourself.  You will need a camera (a modern high-end smartphone has an excellent camera for recording video) and a tripod. If your budget allows a wired or wireless microphone and video light will immediately improve your results. As discussed above video editing software and a reasonably powerful PC will be needed. More details can be found in our guide on buying a PC. Editing a video yourself will take time to learn how to edit then time and patience in to produce the final video.

A third option is available through an innovative Australian company Shootsta who offer a service to provide you with equipment and guidance to shoot the video yourself and then they will edit it professionally within a few days.  They also will take your video footage from your smartphone and edit it. They also offer many instructional videos to help you get that professional result.

HINTS

Great video guides to learn how to make videos can be found here.

According to HubSpot the ideal length of a video used for social media should be:

  • Instagram: 30 seconds
  • Twitter: 45 seconds
  • Facebook: 1 minute
  • YouTube: 2 minutes

You may love a popular song but putting it in your video without permission may put you in court.  Ensure you use royalty-free music and sound effects in your productions.

SUMMARY – Video Production and Editing

Video footage has been proven to enhance a business message. They not only can be used in sales and marketing but also for training.  Always start with a solid plan on how the video will be used and turn that into a checklist to get to that outcome in the video’s production. Your steps of video production include Planning, Shooting, Editing and Distribution.

Having professional help or support in the process will raise the level of your production and increase your chances of the video delivering on the reason you made it in the first place.