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Improving the odds for success

Small business is not a job or a career, it is, in most cases a lifestyle choice. In fact it could be considered a family member

  • Small business is not predictable - it may be successful or it may not, the reasons for success or failure are unlimited
  • The odds for success in small business are improved by:
  2. Good planning
  3. Attention to detail
  4. Good staff
  5. A strong relationship with customers and suppliers (often forgotten)
  6. A good relationship with bank selected by the business
  7. A clear understanding of the business goals
  8. The owner/s must enjoy being involved - not necessary that everyday is wonderful, but on balance, that 80% of the time it is fulfilling and enjoyable.
  9. The owners family is supportive
  10. The owner must be flexible - enjoy the good times, however able to pull back in the bad times

Business Failure is more likely when the following occurs:

  1. Over commitment – eg. Too many cars
  2. The owners spend too much - eg. The GST collected is not yours, it belongs to the Government
  3. Other people’s money is not put aside:

-       Tax from employee’s wages

-       Superannuation

-       GST

  • The owners spend the profit/surplus/drawings and forget that that this is their NETT income, not gross- what about the tax!
  • Don’t be the big man about town, ego kills small businesses, generous donations of cash or goods is wonderful, but it should be done from achieved profits!
  • Bookkeeping and record keeping are a legal requirement, but more importantly – you must know where you are financially, as every decision you make has financial impacts.