Taking the leap and starting your own business can often feel overwhelming or downright scary. But, it doesn’t have to be!
With some prior planning and preparation, you can make an easy transition to self-employment and get to work on building the business (and lifestyle) of your dreams.
Read our top considerations you need to make to become self-employed in 2021!
1. Get into the mindset of being your own boss
Stepping into self-employment takes a lot of decisiveness and courage. Suddenly, you’ll find yourself moving from an environment of being “managed”, to having to make each and every decision (no matter how big or small), for your business.
While you may feel like a fish out of water in the beginning, we recommend spending time reflecting, thinking about the big picture you have for the business, and creating a work environment that helps you remain productive and disciplined throughout the day. Having a support network of friends, family, and other business owners will help you remain calm, collected, and confident in your capabilities as your own boss!
If you’re looking for a great network of small business owners to learn from, be sure to join our Gippsland Entrepreneurs Lunch Club here.
2. Consider tax and superannuation
Tax and super contributions can easily be overlooked when you are new to the world of business. As an employee, tax and super are automatically withheld for you by your employer. But now, you’ll have to do this yourself to avoid any nasty surprises at the end of each financial year.
We suggest you book a no-cost session with the Work My Own Way accountants from Pursuit Advisers to discuss your unique situation. They can help you figure out how much money you should be putting aside for tax and super each week, based on your income and expenses.
3. Decide how much you’ll pay yourself
Another important consideration when starting your own business is deciding how much to pay yourself! Unfortunately it’s not as simple as drawing any leftover money from your business to yourself. We recommend that you think about the business’s money separately from your own.
The first thing to do is to calculate your own personal expenses and living costs, as well as the fixed costs for your business (these are things like website hosting, rent, materials and stock). This will tell you how much money you need to earn in your business to cover these expenses. From here you can look at the profit and sales from your business to determine how much you can afford to pay yourself, and whether you set this up as a salary, an hourly rate, or just pay yourself enough to cover your costs while your business gets off the ground.
While this may sound daunting, remember that it won’t be like this forever. A viable business model along with your hard work and effort can produce fantastic financial results, it may just take a little time to get there.
4. Set your work hours and schedule
Most people start their own businesses because they are looking for something that fits their lifestyle! If this is the case, then you need to consider how you’ll schedule your work around your family and lifestyle.
Firstly, think about the commitments you have each week. Do you need to make school pick up and drop off? Do you have any appointments or hobbies in the evenings?
You can schedule your working hours arounds your activities and personal commitments – that’s the beauty of being your own boss!
Once you have your schedule, break your working week down into the daily and weekly tasks that are necessary for running your business, such as marketing, client emails and phone calls, shipping products, and general admin tasks. You may like to think about the times of day that you are most efficient, and work during your natural peaks in energy. Do you prefer to make your products in the morning, and complete your admin in the afternoon? Or vice versa?
Never underestimate the power of a routine. If you can create a schedule that works for your life, and stick to it, you will find yourself more productive, and able to breeze through your tasks quickly and efficiently.
5. Decide on your non-negotiables
Your non-negotiables are the things that are most important to you and your business – like your values, the key principles that you want to run your business by, and the things that you pledge to do each day. Not only will your non-negotiables help to keep you focussed on what’s most important, but they will guide your decision making and help steer you onto the right path when things get busy.
6. Set up automations and procedures to save you time
One of the most common frustrations we hear from business owners is they get so busy working on the day-to-day operations, that they struggle to find time to work on developing and improving their business.
Setting up automations and procedures can help save you time and energy, so you can focus on what matters most. Some examples of automation are things like pre-scheduling blog posts, social media posts, and email newsletters, using platforms such as Loomly and Mailchimp. You could also create a freebie on your website (such as a guide or checklist), that can help you build your database, or you could add a free bonus on your website when a sale is made, which is sent directly to your customers inbox. While automations such as these can take some time to set up initially, they will help you grow your business organically, without much manual effort from you.
There are other processes available that can help you save time, too. Trello allows you to store your ideas and keep track of your project timelines and priorities, and accounting platforms such as MYOB and Xero, will use automation to generate customer invoices, check for payment, and send payment reminders.
As you can see, there’s a few things you need to think about when it comes to starting your own business. The process can feel that little bit easier when you know what you need to think about and implement to get off the ground.