Starting your own business can be an exciting prospect, yet a daunting challenge. While having their own company and realizing their unique business idea is many people's dream, it does require a significant amount of work and capital. This is why it is crucial for anyone considering taking this step to understand the initial start-up cost. But do not despair - we have compiled this short guide to the cost of starting a business in Australia.
Costs for starting a company
While there is no cost associated with obtaining a Business Number or a TFN application, there is a fee for registering a new business and obtaining a company name. The former amounts to c. AUD 506, while the latter will cost you c. AUD 37 for one year.
Other costs and expenses
Rent for office space
Of course, this expense will depend on what space you rent and by choosing smaller business premises you can save money. The average rent of office rentals in Australia ranges from c. AUD 1,000 per square metre per annum in Sydney to c. AUD 400 per square metre per annum on the Gold Coast.
This can be several business functions that can become significant business expenses, such as legal and accountancy fees. Of course, these professional fees, while expensive, are crucial in ensuring compliance and building a strong foundation for your business.
Paying your team will be the most significant expense to consider when planning your business finances. While minimum wage is c. AUD 753.80 per week, you are likely to need to pay more to at least some of your staff members.
Of course, new small business owners need to protect their companies and pay for insurance. The most useful types include professional indemnity insurance, public liability insurance, and product liability insurance. Of course, the insurance cost depends on eg your history of claims and the business types.
Other business start-up costs
Several other cost factors are not necessarily fixed monthly costs but need to be covered for your business to succeed. This could be things like office supplies, renting vans or cars for logistics, or costs of marketing. It is crucial to include these important expenses in your business plan as they help establish a robust business structure.
How to navigate initial costs
While the sheer number of costs associated with founding a business can be a daunting perspective, there is a large number of funding options for start-ups in Australia. This includes bank loans, crowdfunding, government grants, venture capital, and equity. Doing market research on the different options can help decide which funding route suits you and your business best. Of course, a steady cash flow is important for any business venture. There are a few things you can do to support a steady cash inflow, such as setting up direct debit payments with customers, so you collect payments automatically on due dates.