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thechuckster
Forums Junkie

Location:
Brisbane
Registered:
February 2003

Re: Starting your own Company	Wed, 19 May 2004 12:19

a limited liability company (e.g. Lambo's Inc.) might help isolate you from a business failure or risk (to a point) - but the costs and requirements of establishing and maintaining a company (legally) are significant and possibly cumbersome (and this is just for a private company - going public adds another whole new world of pain and complexity). A simple trading name (e.g. Mr Fred Lambolica trading as Lambo's) allows you to get started with things like business name, bank account, GST & ABN numbers, etc... but exposes you to all the risks (e.g. you loose everything if it tanks). what ever the structure, you're starting from scratch - no credit/trading history, minimal assets, no historical cashflow. Either way, i'd focus on planning your business ... >50% of new businesses fail in their first year because they didn't plan (you'll hear lots of business advisors say that they 'planned to fail'). Work out your cashflow for the year, look at your longer term (assets, liabilities, net position, tax liability, etc), identify where you want business to be down the track, set the milestones you want to measure success/failure against (e.g. at what point do you close up before being forced to sell the family farm - or sell/attract investors the business to recoup your initial investment) Work out your communication and marketing plans - and be able to monitor and measure how you're going with them. Look at your (proposed) business processes and make sure they produce the goods that your business needs (do the things your business needs, do them only and do them well) and be prepared to review and update your plans if they were off target - but identify where and WHY things didn't go according to plan so you don't repeat the mistake. Being a small business requries you to be manager, salesperson and worker - and contracting work has significant risks/overheads you might not find elsewhere... long term contracts restrict cash-flow growth; contracts might expose you to liabailities beyond the initial contract; contracts require maintenance and supervision; etc. talk to a commercial lawyer, accountant, tax advisor, financial planner, banker, etc... get lots of advice and weigh them all up. Look at other business in or related to yours and identify the characteristics of the successes and failures. visit the state small business dept's web site and read up... (in Qld its State Development <www.sd.qld.gov.au>) ...and why do i know this stuff? because i used to be (and sometimes still am) in freelance graphic design - but i prefer being paid each week so i work in gov't and supervise/direct minions ... [Report message to a moderator]

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