5 common errors new business owners make

Thinking of starting your own business? Here are 5 common errors that new business owners make and you should avoid.

Not planning ahead for expenses

If you have 30 day expense accounts, don’t fall into the trap of spending your money now - keep an eye on your payables and reserve your cash so you don’t come up short. Having a good relationship with your suppliers is very important.

Not allowing for income tax

Remember, as a small business you have to pay 25 or 30% of your net profit in tax. Keep an eye on your balance sheet to make sure you are keeping the cash available to pay the ATO when you file your taxes.

Burning out

Make sure to give yourself downtime where you aren’t working or checking your emails etc. Everyone needs time away from the computer and tools, or you won’t be able to enjoy the benefits of having your own business in the first place.

Refusing to engage professionals

Saving money is great, but avoiding paying a professional can cost you far more in the long term. Solicitors, accountants, and even painters aren’t cheap, but not using someone who knows what they are doing can cost you even more when it’s not done right.

Not doing the paperwork

Many of your customers won’t pay without a purchase order reference number or if the incorrect invoice details are used. Making sure that you don’t take someones word for it when doing work and get things in writing will save you in the long term.