Looking to take the leap and start your own business as a sole trader, but have no idea where or how to start? Here are the steps you need to take to get you on your road to sole trader success!
Research, research, research!
Before starting your journey as a sole trader, it is important to research and gain background knowledge on not only how to start a business in your industry, but also what it takes to work independently as a sole trader.
You may also need to evaluate whether or not your business idea is one that will work well in the market, and if there is already a service or product that is too similar and more successful than yours. While hard to admit, it is definitely worthwhile to research and find the answers to such questions before committing your time and hard-earned money into your business idea.
A few tips to help you research the market for your business include:
- Focus on your competitors. Look for which existing businesses you feel may be competing for your intended audience, and make sure your business idea reaches an audience that they do not.
- Establish your target market. Make sure you know exactly who it is that you want to sell your product or service to, and that you have the ability to access such a target market. Whether through social media, manual outreach, or widespread marketing campaigns, make sure your target market can find your business.
Keep your finances in check
You will need to prepare a budget for your business, both before starting on and during your operations, as well as account for taxes and superannuation. As you will be needing to manage all your finances yourself (and not have a higher-up to manage it for you), you will need to get familiar with bookkeeping and invoicing.
In the case that you find such tasks too difficult, it may also be wise to invest in an accountant or a financial advisor to help you sort your taxes out and keep a record of your financial information. This way, you won’t have to learn an entirely new skill set and can spend your time developing and growing your business instead.
Plan your business for the long term
When starting out as a sole trader, you should always have a solid business plan, made to help your business last a long time. Without a business plan and set goals, your business may quickly become disorganised.
To help you create a long-lasting business, here is what your business plan should contain:
- A profile of your business. This includes potential business names, logos, slogans, etc.
- Your goals. What does your business want to accomplish?
- Target market. Who is the target market for your business’ products?
- Practicability. How will you get your business up and running?
- Time. Give yourself certain realistic timeframes for business goals. This way, you will know if your business is progressing on track or not.
- Equipment. What equipment will your business need, and that you need to purchase? Do you have the money for them?
- Marketing. How will you be marketing your business is that you can comfortably reach your target market.
- Funding. Who will be investing in your business, or where you will be getting your initial business funds from?
Make sure you have all the answers to these questions in your business plan before committing to starting up your business. Have any more questions regarding the steps to becoming a successful sole trader? Be sure to discuss your financial queries with a qualified business accountant!
