By Tina Zawila
As we quickly approach Christmas most of us are desperately looking forward to some well-deserved downtime spent with friends and family. It’s also a common time of the year for people to review the last year and ponder their future, whether it’s a new year’s resolution, a new hobby, a new job or maybe even a new business!
If you are thinking of diving into the world of business, it’s important to understand exactly what you are getting yourself into and to consider whether you have the ability to manage business risks whilst simultaneously delivering a product or service to the market that meets customer demands.
Unfortunately, the statistics show that an estimated 20% of new small businesses in Australia will fail in their first year, and up to 60% of start-up businesses will not survive beyond five years of launching, according to the ASBFEO (Australian Small Business and Family Ombudsman).
So, what can you do to avoid being a statistic?
1. One of the main reasons businesses fail is due to a lack of funding or working capital. You need to have sufficient savings or access to funding or other income while you establish the business, and this takes time.
2. You need to have access to professional advice and support. You may be passionate about your product or service, but you must also have entrepreneurial skills and business knowledge to ensure your business is viable and sustainable.
3. Know your market. Have you thoroughly researched the existing market, current and future trends in your industry, who your competitors are and how to identify and reach your target market?
4. Have a plan. A business plan doesn’t need to be an onerous document, it should be a succinct, actionable document that clearly outlines your vision, addresses your risks and demonstrates the future potential of the business.
5. Don’t go it alone. Surround yourself with people who can support and assist you but will also tell you how it is.
The above recommendations apply equally to someone who is looking to buy an established business.
The team at UHY Haines Norton is passionate about business and we love to support start-up business owners on their journey to success. If you need more than a traditional accountant and are looking for someone who really cares about you and your business and has the experience to help you ride the ups and downs, call us on 4972 1300.
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