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Hi, friends. Welcome back to Less Chatter More Matter. As always, it's an absolute pleasure to have you on board this podcast train and a special thanks to [00:01:00] those of you who join us every week. I'm so glad you're finding this really useful. And if you're one of those people who is finding this podcast useful, can I ask a small favour. If you haven't already, please take just 30 seconds to rate and review the show. It inspires me to keep going, it helps the podcast become more visible to people like you who are hungry for learning. Speaking of hungry for learning, one of the things I'm asked about all the time is advice on starting a business.

I offer it freely, although brunches often involved not gonna lie. Um, back in episode eight, I shared the five fun things you should consider when you are looking at starting a business, whether that's as a side hustle or a full-time gig. Today's episode is about the five, what I consider boring, it's not boring for everybody, but the five boring things you'll need to consider.

They're really important though. They're really super important actually, things that will set you up for success with your [00:02:00] business and they are the things I think a lot of people don't consider and then learn about the hard way, and I want to help you so you don't have to learn the hard way. Before we kick off, if you haven't already, now's a really good time to head over to my website heymelcomms.training/freebies, and from there you'll be able to download my checklists on starting a business. I'm going to go through one of those checklists today in much more detail, so you may want to have that handy or just download it later as a bit of a refresher. Okay, let's get into it. So the first thing you should do is decide how you're going to structure your business.

So this means will you be a sole trader, will you run a company or a trust or something else altogether? If you are unsure of this, and don't worry, we're all unsure, then definitely speak to your accountant or a lawyer. There's lots of different ways you can cut it and they have different implications around tax and [00:03:00] liability as well.

So I personally started as a sole trader simply because a, I wasn't sure how long this thing was gonna last to be honest. Um, I was just gonna be freelancing, not running a business at that point, I didn't think of myself as running an agency. Also, quite honestly, I'd had the same ABN sitting in the background for years and just couldn't be bothered to change it.

So, I didn't really know much about any other kind of structure, so I'm really glad I got some advice here because I've now got a trust set up and a company that is the trustee for that trust. The reason for this is if for some awful reason someone comes after me, legally, yes, they can sue the trust, but the trust itself has no assets.

So things like my home and personal effects will be safe. There's also tax implications, so a sole trader is essentially you individually, you earn the money, you get taxed an individual rate on that money, which is typically quite high. [00:04:00] When the money goes into a trust, it's meant to be distributed to the company you set up as well as to you individually.

Trusts don't pay tax, but individuals and companies do so you can divide the income between you and your company and pay different tax rates on both, so to speak. There are other things to consider like how easy it is to manage, so setting yourself up as a sole trader is actually super simple and easy. So it is a good way to get started, especially if you're not going to be earning very much initially.

A trust and company structure is obviously a little bit more complicated. Now, I'm not an accountant or a financial advisor, so I'm not going to suggest you go a particular way. And I obviously haven't shared a great deal of information here. This is very high level stuff. There's a lot more to it, so I really encourage you to seek professional advice to help make a decision, but do it sooner rather than later so that you are not paying more tax than you need to. And that you're protecting yourself.

Tip number two, [00:05:00] speaking of protecting yourself, is to have a set of key documents drawn up. This does depend on what kind of business you are running, what services or products you'll be offering, that sort of thing. So in my case, I'm a service-based business. I don't offer physical products as such, so, I worked with my lawyer to get a terms and conditions document drawn up, which I use with clients when I'm onboarding new clients and a privacy policy for my website as well.

That's really, really important because you wanna include that privacy policy on a bunch of things like, uh, when you're asking for details of a client so that you can set them up in, um, to invoice them and those sorts of things. Or in my case, if I'm booking people in for training and I want them to provide some, sometimes it's personal information like address, phone numbers, all that sort of stuff. Having that privacy policy easily accessible is really, really important. Now when I started growing my business and taking [00:06:00] subcontractors on, my lawyer also drew up a subcontractor agreement, which my team members have had to sign.

So that has different things in there about, you know, liabilities and non-competes and all that sort of stuff. You may want to consider other documents like your refund policy. It really comes down to what you do and how you do it. You know, do you have to pay a lawyer? Look, probably not. There's tons of templates out there on the internet, but I'm not a lawyer.

I wouldn't know if something had loopholes in it or not, and I wanted things to be airtight. I didn't wanna put myself and my business at risk. You don't work that hard to build a business, only for it to go away and be taken away from you because of some silly loophole, some silly legal risk that you didn't tie up, right?

So just think that through before you decide to grab a template off the website, somebody else's website. But again, I am not a lawyer, so I [00:07:00] strongly advise you to get some advice on this. And also seek out recommendations for a lawyer as well, someone who charges reasonable fees, not those exorbitant fees that the big companies charge either.

The third thing to do is find out what insurances you might need. So for example, if you are opening a bricks and mortar business, a store, a restaurant, whatever that looks like. You should have some sort of insurance that covers you for loss or damage of the belongings inside of that store, right?

So, um, the products or equipment you have, those sorts of things. If you're leasing, you don't need to worry about the building insurance as such. In my case, I have public liability and professional indemnity insurance. This covers the work that I do. It's also really important because, um, I often work from clients' offices and or bring people together for workshops offsite somewhere.

So I need to be covered for those [00:08:00] things. And every now and then I have a client who asks to see those certificates of currency before they will agree to work with me as well, because their own businesses have their own risk, which is totally okay. It's probably worth doing a quick search online and having a chat to maybe an insurance broker to get an understanding of what insurance you will need for your line of work.

Also, absolutely shop around because the prices I found, uh, they varied considerably. So check in with other business owners, perhaps see what kind of insurances they have, why they have them, if they have any recommendations for providers. All those sorts of things.

Now, the fourth boring thing on this checklist is to set up your financial management systems. Blurgh.

I know I'm not into this stuff at all, but I am so glad I set it up early because my spreadsheets were a hot mess, especially as my business grew really quickly and I took on subcontractors and we were trying [00:09:00] to um, you know, manage invoices, uh, keep track of the time we were spending on different jobs for different clients, all that sort of stuff.

So you'll need a few things here. Firstly, a business bank account. Be aware that you'll have to have some paperwork ready for that, like an ABN, your trust documents if you've structured your business that way. All that stuff. My own experience was, it was a bit of an involved process. Uh, but look, it had to be done.

It took a couple of appointments at the bank, some phone calls, uh, some online stuff to get things set up. But we got there eventually. So that's what's important. Your financial management system should also include bookkeeping software. Now this is where you will track all of your incoming revenue and the outgoing expenses, things like subscriptions, uh, receipts for purchases of things like computers and office equipment.

Uh, fuel if, if that's relevant to you. You'll track the payments of your staff or subcontractors if you have them, suppliers. Now I use [00:10:00] MYOB or MYOB, which is a pretty popular platform. Xero is also a very popular tool for small businesses. A lot of people I know use Xero as well. From what I understand, they're pretty much the same thing. They're just competitors. Now I've set up my software, so it is linked to my business bank accounts, so a lot of transactions are automatically identified and coded, which is great. And I've also given access to that to my accountants so they can easily manage my quarterly tax, my BAS payments, superannuation, do all the end of year reporting, all that sort of stuff.

I personally have a wonderful admin person, Karen, who does a lot of the MYOB management for me. She chases up my team's invoices, she logs them in MYOB, logs all my receipts, invoices my clients at the end of each month, all that sort of stuff. Of course you can do all of that yourself if you want to. And MYOB has some really clever automation tools.

I just hate admin and I'm really useless at it. I lose receipts, um, and by the end of the financial year, it's [00:11:00] just a bit of a nightmare. So Karen is the person who helps me to help myself and I love her so much. Also, if you're in the business of hiring staff or subcontractors, or you work on a time-based schedule, so for example, an hourly rate for clients, consider a tool like Clockify to help track and budget the hours that you are working for clients.

So all of my team are on Clockify, so at the end of the week, I can see exactly how long we've spent on particular clients or on particular projects. Really important for our retainer clients particularly, and I can make sure we're staying within the hours that I've budgeted for.

A bit of a side note here as well, if you earn over a certain amount in Australia, you will have to pay GST at some point, so just think about that and you'll need to get yourself set up for paying GST. Again, I just got my accountant to help with that. I tried doing it online. I just found the system just completely incomprehensible, so I just threw money at that problem.

Um, but you will have to get yourself set up with [00:12:00] GST once you earn over a certain threshold, you will have to pay that unfortunately. And uh, the other piece is too, that if you are in the business of hiring subcontractors rather than staff, don't think you can get away with not paying superannuation. So there is a test here that you can take online to see if you are eligible to pay superannuation to your subcontractors.

And if you are, you absolutely need to make sure you are doing that. And again, your accountant can provide you with advice on that, and my accountant helps to, um, sort out exactly how much I owe in superannuation for my guys each quarter, and then I pay that to their nominated super account.

Now, the other thing to think about is templates.

Again, bookkeeping software like MYOB already has built in templates for quotes and invoices, and it will help you build those out and you can customise those. If you are only doing the odd invoice here and there though, you can probably just create your own invoice template and there are plenty online as well.

You might also want to set up [00:13:00] a series of email templates to just whip out when you need, so responses to frequently asked questions, an email you send when you onboard a new client. For example, we have a weekly wrap email that we sent at the end of each week to, our retainer clients, to update them on how we've used their hours for the week, what's with them for review or to action, and what's on the board for the week ahead.

And that just gives them some confidence that, yep, your hours are being well spent, that we're achieving what we said we were going to achieve, and reminds them of the things that they need to action. So have a think about the things you'll be writing or sending out regularly and how you can make your life easier by templating as much of that as possible.

Okay, so as always, a quick episode recap of the key points I've covered. Number one, decide on how to structure your business. And I really reiterate here, get some advice from a good accountant or lawyer. Number two, get key agreements or documents drawn up that you will [00:14:00] need to protect yourself and your business.

So things like terms and conditions, subcontractor conditions, privacy policies, et cetera. Find out what insurance you're going to need to protect yourself and your business, and the types of insurance your customers or your clients might expect you to have as well.

Set up your financial management systems. So bookkeeping software is a priority, but also things like time sheeting and rostering, and set up your common processes and templates so that everything is documented and to make it much easier for you to run your business. I heard something the other day from Don Miller, some of you might have heard of him before, he's quite well known as a marketer and has a podcast himself and a whole bunch of books, and what he said was, nobody starts a business to run a business. And he's absolutely right. You know, what he's saying is people start a business because they're passionate about something. They love an idea or a product they want to offer.

They want a [00:15:00] little bit more freedom or flexibility or, you know, those sorts of things. They don't actually, you don't start a business because you love running businesses. Look, maybe you do, but typically speaking, that's not the case. So all these other things may not come naturally to us and they're things I've had to learn and shape and change over the last couple of years as I've, you know, really settled into that role of running a business, not just working for my clients, but running a business.

So really, I'm trying to help you here, like to set yourself up for success and of course, if you are a business owner and have any items to add to this list, by all means, please reach out. And once again, you can head to my website, heymelcomms.training/freebies, and download my business startup checklist for free.

The links are in the show notes as well, and if you ever have any questions, of course, please reach out. I would be well behind where I am today if it weren't for the generosity of other business owners and consultants sharing their [00:16:00] time and knowledge with me. So I'm more than happy to pay it forward and do the same for you.

In the meantime, keep doing amazing things and I'll see you all back here next week.