Introduction 1
About This Book 1
Foolish Assumptions 2
Icons Used in This Book 2
Where to Go from Here 3
Part 1: First Steps 5
Chapter 1: Is Small Business for You? 7
Working for Yourself A Dream Come True? 8
Doing what you love to do 8
Earning pots of money (heres hoping) 8
Being your own boss 9
Staying home 10
Working for Yourself Reality Strikes 11
Teetering on the edge 12
Working night and day for little pay 12
Weathering feast and famine 13
Getting the Timing Right 13
Timing it right for your idea 14
Timing it right for you 15
Timing it right for the economy 16
Staying Safe or Inventing the Wheel? 17
Playing it safe 17
Finding your own niche 18
Going out on a limb 18
Getting the Government to Help You 19
Chapter 2: Buying a Business 23
Weighing Up the Good and the Bad 24
Buying an existing business the upside 24
Buying an existing business the downside 25
Asking the Right Questions 26
Finding out who owns the intellectual property 27
Analysing sales trends, profit and break-even 27
Clarifying what the purchase price includes 28
Building a Relationship with the Seller 30
Dotting Your Is, Crossing Your Ts 31
Part 2: Jump In, Get Wet 35
Chapter 3: Planning for Success37
Getting Started with Your Plan 38
Hunting for online resources 39
Using specialised planning software 40
Assessing the Environment 40
Analysing outside influences 41
Testing the waters (dont get too wet) 43
Defining your customers 44
Checking out the competition 44
Declaring Your Battle Plan 46
Looking at your strengths and weaknesses 46
Choosing a strategy 48
Expressing your competitive advantage 49
Building your online business strategy 51
Developing your marketing plan 52
Creating a team 53
Charting a True Course 53
Setting off on your mission 53
Saying what youre about 54
Matching goals to your mission 55
Presenting Financials 56
Balancing dreams against reality 56
Building on history to create a picture of the future 57
Staying real with benchmarks 58
Chapter 4: Getting the Legals Right61
Picking a Business Structure 62
Independent and single 63
Tea for two 64
Weve got company 65
Matching the Name to the Game 65
Using your own name 67
Making sure youre not on someone elses patch 67
Registering your business name (Australia only) 70
Avoiding trouble (Australia only) 71
Protecting Your Ideas and Your Name 71
Registering with the Powers That Be 73
Getting that babys number 73
Signing up for taxes (unavoidable, Im afraid) 74
Checking out what else you need 75
Chapter 5: Creating Your Marketing Plan77
Laying Down the Elements of Your Plan 78
Writing a decent introduction 79
Identifying what it is that makes you different 79
Defining Your Target Market 80
Analysing your customers 81
Researching the market 81
Analysing Your Competitors 82
Setting Sales Targets 84
Slicing goals into bite-sized chunks 84
Expressing goals in other ways 85
Creating Strategies to Support Your Targets 87
Building a brand that people want 87
Getting the products and the price right 88
Planning an advertising strategy 90
Working your networks 91
Part 3: The Nitty-Gritty 95
Chapter 6: Becoming an Employer97
Becoming an Employer: The First Steps 98
Getting employees to fulfil their part of the deal 98
Covering employees for accidents 100
Subscribing to super (Australia only) 101
Paying KiwiSaver (New Zealand only) 104
Meeting Minimum Pay and Conditions 106
Understanding what laws apply (Australia only) 107
Creating employment agreements (New Zealand only) 108
Choosing between part-time, full-time or casual 110
Playing Safe and Playing Fair 111
Being practical, not pedantic 111
Blonde jokes are over 112
Chapter 7: Cooking the Books115
Setting Off on the Right Track 115
Understanding how cloud accounting works 116
Addressing privacy concerns 117
Figuring out whats important 119
Creating a Bookkeeping System 121
Keeping track of bills, receipts and invoices 122
Organising your information 124
Nitpicking over petty cash 126
Tracking How Much You Owe 127
Chapter 8: Understanding Financial Statements129
Telling a Story with Your Profit& Loss Report 130
Understanding how it all works 130
Looking at sales 131
Counting the costs 132
Weighing up your expenses 134
Taking a Snapshot with Your Balance Sheet 134
Understanding the fine print 136
Building documentation to support each figure 137
Appreciating your net worth (someone has to, after all) 137
Why Profit Doesnt Always Mean Cash 138
Gazing into the deep, black hole 139
Looking through rose-coloured spectacles 139
Doing the sums for sustainable growth 140
Budgeting As If You Mean It 141
Creating your first budget 142
Recognising relationships 144
Understanding the psychology of budgets 145
Developing your budget in tune with your business plan 146
Chapter 9: Calculating Margins and Ratios149
Understanding Profit Margins 150
Differentiating between variable costs and fixed expenses 150
Understanding gross and net profit 151
Figuring gross and net profit margins 152
Looking at gross profit margins over time 153
Appreciating how margins and sales connect 154
Analysing Margins for Your Own Business 155
Calculating margins when you sell products 155
Calculating margins when you charge by the hour 156
Calculating margins if you do big projects 157
Understanding why gross profit is such a big deal 158
Calculating your net profit margin 159
Estimating Your Break-Even Point 161
Analysing how to make sales match expenses 162
Looking at things from a cash perspective 163
Factoring your personal expenses into the equation 164
Part 4: The Part of Tens 167
Chapter 10: Ten Things to Do If You Hit Hard Times169
Work Out How Bad Things Really Are 170
Get Breathing Space 171
Innovate! 172
Slash Those Expenses 172
Pull Back Personal Spending 173
Get Rid of Dead Weight 174
Chase Up Overdue Accounts 175
Run Special Offers 175
Re-Jig Your Margins 176
Dont Be a Shag on a Rock 177
Index 179
