When you’re starting a business, capital is thin on the ground. It’s tempting to either cut corners or, on the other hand, to overspend to make a good impression on new customers. Before you get the credit card out, read these expert words of advice.
Timo Brower, managing director, Motorola Mobility ANZPI
What are the must-haves for small businesses starting out?
With SMBs making up 40 percent of Australia’s workforce, and over a quarter of Australia’s small business (11 percent) currently operating without a desktop PC, the future need is clear: mobile connectivity.
Productivity on the go harnesses an ‘always-on’ culture, and can substantially reduce overheads helping drive profitability. At Motorola Mobility, we understand mobility, after all we invented the mobile phone. Our latest service innovations, like Webtop and MotoCast have made it easy for businesses to simultaneously surf the web, take calls and collaborate on a presentation. Running a full-version of Firefox and additional web-based applications literally turns your device into a home office.
What are the new products and services out there they may not have considered to make starting their business easier/cheaper/quicker?
SMBs are embracing technologies to increase levels of mobility, with one-in-five saying they are planning to introduce new products and services in order to grow. When combined with key apps like MOTOPRINT, which enables you to use your device to print from anywhere, your office is wherever you are. Our latest app service offering, MotoCast, allows SMBs to access their main PC wirelessly and stream their entire content straight to their device – it’s the ultimate mobile service.
What do startups neglect to invest in which they really should spend money on to help them in the long-term?
Technology. And when I say technology I mean smart technology and smart products; devices that can do the same as your average PC and more, wherever you need them. Almost half of SMBs say that computers and technology give them more control over their lives and our devices are designed to enable content access and sharing on the go, enhanced by enterprise grade security, allowing everyday business tasks to be completed at speed.
Chris Stallard, senior leader SME portfolio, Suncorp Commercial Insurance
What are the must-haves for small businesses starting out?
Small businesses should protect their assets (premises, equipment, motor vehicles, etc), which should be covered against fire, theft, storm damage and other hazards. This applies to intangibles like public liability and professional indemnity insurance. Public liability covers you against accidental damage to people and their property while they are on your premises.
Professional Indemnity covers businesses that offer advice, like financial advisors and architects. It protects you from lawsuits based on the advice you have offered in good faith.
What are the new products and services out there they may not have considered to make starting their business easier/cheaper/quicker?
Business owners with simple needs can arrange their insurance online. Others may need help and a discussion of options. Larger businesses can opt for the advice of an independent broker or advisor.
What are the most common mistakes you think start-ups make when it comes to choosing what to invest in? How can they avoid them?
Underinsurance is common. It is easy to underestimate the value of assets, especially as the business grows. Has the business added equipment or upgraded vehicles? Has turnover increased? Does it carry extra stock?
Current replacement costs should also be checked. Some owners try to save money on premiums but if they’re underinsured, their policies won’t pay them the right amounts.
What do startups neglect to invest in which they really should spend money on to help them in the long-term?
A protection that all small businesses need (but many neglect) is Business Interruption insurance. This covers you if your business can’t trade because of an insured event like a fire, burglary or storm damage. If a supplier can no longer supply you or access to your premises is prevented, your income could halt. But there are still bills to pay like rent, leases, salaries, suppliers – the list goes on. Business Interruption insurance helps meet your commitments when your business can’t trade. It is affordable and provides great protection. But only around 50 percent of small businesses have it. Statistics say 30 percent of businesses will fail without Business Interruption.
When you’re starting a business, capital is thin on the ground. It’s tempting to either cut corners or, on the other hand, to overspend to make a good impression on new customers. Before you get the credit card out, read these expert words of advice.
Joel Montgomery, Powerbuy
What are the must-haves for small businesses starting out?
A good accountant, lawyer and a line of credit. It’s worth spending the time to get your company structure right, your contracts drawn up correctly and a plan for drawing on additional funds when required. Once you have these three things then all you need is a patience and determination.
What are the new products and services out there they may not have considered to make starting their business easier/cheaper/quicker?
Our service is all about helping start-up businesses save on technology. When I started PowerBuy back in 2008, I stumbled onto some great services to help cut costs. IP Australia’s Head Start is a cheap way to register your trademark and MYOB Atlas is a cheap way to build a web presence. For a small annual fee, the NSW Business Chamber gives me access to an advice hotline that I still use regularly to ask questions about compliance, staffing issues and cashflow.
What are the most common mistakes you think start-ups make when it comes to choosing what to invest in? How can they avoid them?
My advice is not to overinvest in anything until you’ve proven that it works. Common traps include website development and marketing. I put way too much money into my website at launch and I have subsequently made dozens of changes, including a full website rebuild now that I understand what works. The big lesson for me is patience and constant testing and re-testing. We make a lot of mistakes as a small business owner and the key is to learn and avoid making them again!
Cindy Batchelor, executive general manager, Small & Emerging Business, NAB
What are the must-haves for small businesses starting out?
The first piece of advice for small businesses is to develop a business plan. Having an up-to-date business plan will help you focus, crystallise your ideas and identify priorities, saving both time and effort down the track. It also needs to explain your objectives and the actions required to get your small business from where it is now, to where you want it to be.
What are the most common mistakes you think start-ups make? How can they avoid them?
Not updating their cashflow forecast as frequently as they should. A cashflow forecast can help predict upcoming cash surpluses or shortages to help you make the right decisions. Cash is like oxygen for a business: mismanagement of cashflow can have dire consequences on businesses that are waiting for invoices to be paid as how quickly cash is collected from debtors (or debtor days) pile up and costs continue to rise. Having a healthy cashflow enables a business to cover everyday and unexpected costs, ride out fluctuating economic conditions and plan for growth.
What are the new products and services out there they may not have considered in order to make starting their business easier/cheaper/quicker?
We have recently launched a Business Payments Card which enables businesses to manage expenses more effectively in the early days and beyond. Customers use their own funds and can load different amounts onto different cards ensuring they are in control of their expenses. Plus it enables customers the convenience of making purchases wherever VISA is accepted.
What is your number one piece of advice for startups? Choose a bank that understands your needs. A good business bank should understand you, be responsive and be there when you need them. They should have expertise across business and personal banking products. They will have the authority to make credit decisions for their customers. It’s about supporting you when you need it most and having the knowledge and authority to back it up!
What should startups invest in to help them in the long-term?
Investing in relationships is an important part of successful businesses. From the outset its important small businesses develop strong relationships with their customers, suppliers and service providers such as their accountant, banker or their solicitor. Cultivating and nurturing relationships with those involved in the development of your business will pay dividends over the long-term.
Tim Reed, CEO, MYOB
As a nation we should do all we can to educate, encourage and celebrate start-ups. With assistance from business advisors, good planning and smart technology, they can easily become influential entrepreneurs. At the very least they will be important contributors to our GDP and employment, and therefore to the happiness of many Australian families.
When starting a business – even better, before starting a business – take time to source good advice. An accountant can help you plan your venture, set up key systems and structures, and work through legislation, training and financing. They can also provide valuable insights into the local business environment and help benchmark your operation against others (what they’ve experienced, how they’re set up, and the challenges they face). Then, explore knowledge channels including other business owners, business coaches and small business media channels like online forums, blogs, eNewsletters and magazines.
It’s crucial to set yourself up from day one with a business management software system that makes running your business easier across needs such as your accounting, payroll, client management, website and more. There are many inexpensive options today, both online and on the desktop, so there is no need to start up without one in place. The right software will also help you manage compliance complexities, the single biggest issue in most SME surveys by MYOB.
A key marketing tool that you should absolutely invest in early on is a website. Being found online can make a significant difference by both heightening the awareness of your business and boosting your revenue. It can give you a real competitive advantage – about two-thirds of this country’s population search online first for a product or service.
Manpal Jagpal, commercial product marketing manager, Hewlett Packard Personal Systems Group Australia.
What are the must-haves for small businesses starting out? A good commercial laptop with plenty of processing power, hard disc drive with security (encryption).
What are the new products and services out there they may not have considered to make starting their business easier/cheaper/quicker? Look at productivity gains from selecting the correct products to support a function. For example, dual screens can increase productivity as well as be easier on the eyes.
What are the most common mistakes you think start-ups make when it comes to choosing what to invest in? How can they avoid them?
Some investments may seem a luxury, like additional warranties with accidental damage or same-day servicing, but they give you the peace of mind that in the event of an issue you can still focus on your business.
What do startups spend more than they need to on? On their IT concerns! I suggest working with a local Commercial Computer Reseller. They know your area and will support your growth. They are usually small businesses as well!.
What do startups neglect to invest in which they really should spend money on to help them in the long-term? Commercial IT products versus consumer offerings, as these commercial versions really do have functionality that businesses need like hard drive encryption.
Ben Crosariol, brand manager, Canon
What are the must-haves for small businesses starting out?
You definitely need office equipment to make your business run efficiently and smoothly. For many small to medium sized businesses, starting out, or trying to expand to capture more of the market can be difficult and also be very hard on the budget. However, many businesses make the mistakes of not doing enough research and taking a random salesperson’s recommendation and get stuck with equipment that’s either not designed for the task, can’t handle the office volume or work, not as fast as they need, doesn’t have the functions that are important to any business or even worse, costly to run.
What are the most common mistakes you think start-ups make when it comes to choosing what to invest in? How can they avoid them?
I know many people are time poor, but the more research you can do online, in store or through other businesses on what equipment they use, the better your understanding will be of how certain equipment works in a real life situation. Some products and companies say they will deliver the world, but often fall short. Look for quality products from companies with a long heritage in the field. This will allow you to see their track record, and generally if they have been around for a good while, then you can rest assured consumers are happy with them. Many start-ups purchase printers or scanners that can’t handle the required pages per minute, or per day or per month – which causes the equipment to break down, which in turn gets the users or staff frustrated and not being able to do their work properly.
What do start-ups spend more than they need to on?
Often new start-ups try to impress anyone and everyone to attract new business. You do have to spend money to make money, but don’t go overboard. Get the products and services that are fundamental to the day-to-day fast, clean, secure and efficient running of your business. Make sure you have products that your staff can rely on to make their job that little bit easier. You can always go out and buy more products or expand when needed – but don’t get into massive amounts of debt on buying everything ‘flashy’ to impress and then not being able to pay it back.
What do start-ups neglect to invest in which they really should spend money on to help them in the long-term?
Fast, efficient and environmentally friendly printers, MFDs and scanners that can handle the required workload for that sized businesses. Also have a good understanding of how many pages your company needs to print or scan on a daily, weekly or monthly cycle to ensure you are investing in equipment that can handle the workload you and your staff will throw at it.
