Veechi Curtis - Small Business for Dummies

Small Business For Dummies®, 6th Australian Edition

Published by

Wiley Publishing Australia Pty Ltd

42 McDougall Street

Milton, Qld 4064

www.dummies.com

Copyright © 2021 Wiley Publishing Australia Pty Ltd

The moral rights of the author have been asserted.

ISBN: 978-0-730-38484-7

All rights reserved. No part of this book, including interior design, cover design and icons, may be reproduced or transmitted in any form, by any means (electronic, photocopying, recording or otherwise) without the prior written permission of the Publisher. Requests to the Publisher for permission should be addressed to the Contracts & Licensing section of John Wiley & Sons Australia, Ltd, 42 McDougall Street, Milton, Qld 4064, or email auspermissions@wiley.com .

Cover image: © Carlina Teteris/Moment/Getty Images

LIMIT OF LIABILITY/DISCLAIMER OF WARRANTY: THE PUBLISHER AND THE AUTHOR MAKE NO REPRESENTATIONS OR WARRANTIES WITH RESPECT TO THE ACCURACY OR COMPLETENESS OF THE CONTENTS OF THIS WORK AND SPECIFICALLY DISCLAIM ALL WARRANTIES, INCLUDING WITHOUT LIMITATION, WARRANTIES OF FITNESS FOR A PARTICULAR PURPOSE. NO WARRANTY MAY BE CREATED OR EXTENDED BY SALES OR PROMOTIONAL MATERIALS. THE ADVICE AND STRATEGIES CONTAINED HEREIN MAY NOT BE SUITABLE FOR EVERY SITUATION. THIS WORK IS SOLD WITH THE UNDERSTANDING THAT THE PUBLISHER IS NOT ENGAGED IN RENDERING LEGAL, ACCOUNTING, OR OTHER PROFESSIONAL SERVICES. IF PROFESSIONAL ASSISTANCE IS REQUIRED, THE SERVICES OF A COMPETENT PROFESSIONAL PERSON SHOULD BE SOUGHT. NEITHER THE PUBLISHER NOR THE AUTHOR SHALL BE LIABLE FOR DAMAGES ARISING HEREFROM. THE FACT THAT AN ORGANISATION OR WEBSITE IS REFERRED TO IN THIS WORK AS A CITATION AND/OR A POTENTIAL SOURCE OF FURTHER INFORMATION DOES NOT MEAN THAT THE AUTHOR OR THE PUBLISHER ENDORSES THE INFORMATION THE ORGANISATION OR WEBSITE MAY PROVIDE OR RECOMMENDATIONS IT MAY MAKE. FURTHER, READERS SHOULD BE AWARE THAT INTERNET WEBSITES LISTED IN THIS WORK MAY HAVE CHANGED OR DISAPPEARED BETWEEN WHEN THIS WORK WAS WRITTEN AND WHEN IT IS READ.

Trademarks:Wiley, the Wiley logo, For Dummies, the Dummies Man logo, A Reference for the Rest of Us!, The Dummies Way, Making Everything Easier, dummies.com and related trade dress are trademarks or registered trademarks of John Wiley & Sons, Inc. and/or its affiliates in the United States and other countries, and may not be used without written permission. All other trademarks are the property of their respective owners. Wiley Publishing Australia Pty Ltd is not associated with any product or vendor mentioned in this book.

1 Cover

2 Title Page

3 Copyright

4 Introduction About This Book Foolish Assumptions Icons Used in This Book Where to Go from Here

5 Part 1: Getting Started Chapter 1: Is Small Business for You? Working for Yourself — A Dream Come True? Working for Yourself — Reality Strikes Getting the Timing Right Staying Safe or Inventing the Wheel? Getting the Government to Help You Setting Yourself Up for Success Chapter 2: Figuring Out What’s So Special about You (And Your Business) Understanding Strategic Advantage Justifying Why You Can Succeed Understanding How Risk Relates to Gain Figuring Out Who Your Competitors Really Are Choosing Your Competitive Strategy Chapter 3: Starting from Scratch, Buying a Business, or Joining a Franchise Weighing Up the Good and the Bad of Buying a Business Asking the Right Questions Calculating the ‘True’ Earnings of a Business Valuing an Existing Business Dotting Your I’s, Crossing Your T’s Buying a Franchise Exercising Due Diligence

6 Part 2: Finding Your Entrepreneurial Spirit Chapter 4: Separating Yourself from Your Business Deciding What Path You Want to Take Wearing Different Hats Building a Business with a Life of its Own Appreciating the Limitations of Your Business Chapter 5: Staying One Step Ahead Taking an Eagle-Eye View Rating Your Capabilities Identifying Opportunities and Threats Doing a SWOT Analysis Creating a Plan for Change Chapter 6: Creating a Business Plan Getting Started with Your Plan Charting a True Course Assessing the Environment Declaring Your Battle Plan Outlining Your Marketing Plan Describing Your Dream Team Presenting Financials Chapter 7: Getting the Legals Right Picking a Business Structure Matching the Name to the Game Protecting Your Brand Registering with the Powers That Be Working with Contracts Negotiating Lease Contracts

7 Part 3: Planning for Profit Chapter 8: Figuring Out Prices and Predicting Sales Choosing a Pricing Strategy Building a Hybrid-Pricing Plan Forming Your Final Plan of Attack Monitoring and Changing Your Price Building Your Sales Forecast Creating Your Month-by-Month Forecast Chapter 9: Building Profit Projections Understanding the Cost of Your Sales Forecasting Expenses Building Profit Projections Understanding the Whole Deal Factoring Personal Expenses into the Equation Chapter 10: Calculating Your Break-Even Point Identifying Your Tipping Point Changing Your Break-Even Point Looking at Things from a Cash Perspective Chapter 11: Creating Your Marketing Plan Laying Down the Elements of Your Plan Defining Who Your Customers Are Analysing Your Competitors Setting Sales Targets Building Sales Strategies Expanding Your Reach Offline Keeping Yourself Honest

8 Part 4: People Power Chapter 12: Making Service Your Business Creating a customer service culture Going the Extra Mile Evaluating Your Performance Showing That You Care Dealing with Complaints Chapter 13: Becoming an Employer Becoming an Employer: The First Steps Meeting Minimum Pay and Conditions Playing Safe and Playing Fair Chapter 14: The Art of Management Drawing Up a Position Description Playing the Recruitment Game Picking the Best Offering Someone a Job Learning to Lead Don’t Worry, Be Happy Managing Difficult Employees

9 Part 5: High Finance Chapter 15: Financing Your Business Budgeting Enough for Start-Up Separating Start-up Expenses from Operating Expenses Sizing Up Your Finance Options Choosing Your Lender Chapter 16: Cooking the Books Figuring How Often to Do the Deed Choosing Software that Fits Creating Recordkeeping Systems Keeping Track of How Much You’re Owed Meeting Bookkeeping Deadlines Chapter 17: Understanding Financial Statements Discovering What Reports You Need (and When) Telling a Story with Your Profit & Loss Report Taking a Snapshot with Your Balance Sheet Why Profit Doesn’t Always Mean Cash Budgeting As If You Mean It Looking at Cashflow Chapter 18: Taming the Tax Tyrant Getting a Grip on GST Growing Some Recordkeeping Smarts Planning Ahead Staying Out of Trouble Budgeting for Tax

10 Part 6: The Part of Tens Chapter 19: Ten Things to Do If You Hit Hard Times Work Out How Bad Things Really Are Get Breathing Space Innovate! Slash Those Expenses Pull Back Personal Spending Get Rid of Dead Weight Chase Up Overdue Accounts Run Special Offers Re-Jig Your Margins Don’t Be a Shag on a Rock Chapter 20: Ten Tips for Selling Your Business Start with a Game Plan Prepare Well in Advance Give Your Financials a Make-Over Get a Professional Valuation Go for the Max Plan for a Few Bills Woo the Buyer Do Due Diligence in Advance Be Straight Up with Employees Spread the Word