A Business Startup Checklist Carefully Followed
will get your new venture off to a great start.
Coming up with a single "business startup checklist" is a bit ambitious. Just how long and detailed should it
be? It's the proverbial piece of string - as long and as detailed as it needs to be.
In truth there is no such thing as a single list.
But it's also true that a business which is well-planned will have a much better chance of succeeding, and a good
business startup checklist will get you off to the best start.
Attaching time-lines to the list, turns it to an action plan.
Preparation
Research your idea
Research the market, and determine whether your business idea is feasible.
Are YOU ready?
Do you have the skills and experience to startup and manage a business?
Nobody knows everything about everything. What additional skills and resources will you need to enable you to
carry out your plans?
So put this item on your business startup checklist: "Choose your key advisers, and determine how you will
manage their input - accountant, solicitor, insurance adviser."
Determine your funding requirementsYou will have startup business finance requirements, including capital expenditure, and then ongoing
requirements until the business becomes self-funding. Construct cash flow forecasts which will let you understand what the funding requirements will be for
the first few years.
Test your funding plans by assuming for a moment that your business startup DOESN'T go according to plan.
Make sure you understand the effect of delays on your cash flow, the cost of finance, and whether you will have
enough buffer to carry you through. This means stress-testing your cash forecasts with high and low "what-if" assumptions.
Determine your funding sourcesOnce you know your likely funding requirements , then work out where the
money is going to come from. Business funding has three sources:
- Equity (including your own funds)
- Borrowing
- Grants
The sources of funding will have a bearing on your costs, and should be reflected in your cash flow forecasts.
Consider also the possibility of having to re-finance down the track, if/when any of your lenders requires
repayment.
Your business startup checklist should tick off all possible funding sources, as well as discussing your
financing plans with a business finance broker, to get an understanding of what's possible, and the best mix of
loans, leasing and other funding methods.
There's not much in the way of direct cash business grants for business startups, as government support schemes
are mainly advisory, although there are some specialist funding arrangements in specific industries. Your business
startup checklist should remind you to check whether your business has any entitlement.
RegulationsResearch the regulations covering your industry, and (if applicable) commence registration
processes. Almost all industries these days are affected by some form of business or consumer registration. Develop
a list, and start applications as soon as practicable. Working with children? Offering credit? Operating machinery?
Your business startup checklist should remind you to check with your state government business advice office for
details.
Business planAn essential business startup checklist item: Prepare a business plan. Just do it, you won't regret it.
This will assist your fund-raising, and serve as your own guidance document for setting up and running the
business.
Legal structureVisit your accountant and or/legal adviser.
Work out the best legal structure (sole trader, company, partnership, trust) and have documents prepared, and where
applicable, names registered.
(Tip: the cheapest structure is not always the best. There are many competing factors, be prepared to accept
your adviser's recommendations).
This is a big area. Your structure must not only serve your immediate purposes, but also link in with any
retirement plans, future capital raising, and a range of (often conflicting) tax and personal considerations.
Determine tax registration requirements, and note for your business startup checklist the person who will
attend to this (usually you or your accountant).
Determine and set up your financial accounting and software requirements, based on:
- your need for management information and:
- statutory reporting (state and federal taxes) obligations.
Be prepared to accept guidance, your accountant has seen untold instances of businesses being damaged by poor
bookkeeping.
Intellectual propertyDiscuss the protection of your intangible assets with your legal adviser and
accountant. Take steps to protect your names, trade marks, ideas, methods, goodwill and any other property of
value.
PremisesLocation of suitable premises, negotiation of a suitable lease, and attending to the fit out
requirements usually take a great deal of time and energy.
Make a time based action list linked to (or contained in) your business plan, and be prepared to relentlessly
chase tradesmen and anyone else you are relying on to meet your opening deadlines.
Ordering equipment and inventoriesContact suppliers of choice, to get an understanding of your major
supply terms, and the implications for your cash flow. Businesses without a credit record may need to pay on
delivery for a period of time. The business plan financial forecasts should reflect this working capital
requirement.
Human resourcesYour business plan will include an assessment of your staffing needs. There are a range of
issues relating to the employment of staff. Consider:
- training, cost and lead time
- registration or licensing (if any) requirements
- channels for sourcing the best people
- recruiting timetable
- detailed job descriptions
- proposed remuneration packages and on-costs
- interview procedure and checklist
- pre-employment checks (e.g. medical, police clearance) & who pays
- forms of employment contract you intend to use
- employment policies - e.g. non-discrimination, internet use, leave entitlements and negotiation,
non-smoking
- uniforms
- PAYG registrations
- workers compensation insurance requirements
InsuranceA specialist area where you must get professional advice to ensure that legal and professional
requirements are met, and that business risks are adequately covered. As a minimum, you will need to consider:
- Business assets, profits and motor vehicle insurance
- Public liability insurances, product liability
- Employee (workers compensation) insurance
- Professional indemnity
- What else? Take advice.
Web siteRelatively high internet usage now being the norm, means that many businesses can benefit
significantly from a carefully structured internet presence. You would need to consider:
- development of the website marketing plan
- setup of the website - who? and what time frame?
- traffic generation strategies, and ensuring the financial plan reflects the costs
- research the legalities - e.g. trade marks, privacy, anti-spam laws
- hardware and software requirements
- arrangements to accept on-line payments
Marketing and sales
- Obtain legal advice regarding labelling and advertising
- Develop a list and production time-frame for your marketing tools, including logo, stationery, brochures,
signwriting, advertising production and bookings.
Banking requirementsEstablish loans and bank accounts in accordance with your business plan.
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