Setting Proper Expectations in Planning Your Entry into the Australian Business Market
The Australian market is a great place to tap into. Australia is politically stable with a transparent regulatory system and is ranked in the global top five on the Index of Economic Freedom.
Furthermore, Australia’s regulatory environment is ranked as 15th out of 190 countries when it comes to ease of doing business based on the World Bank’s Doing Business 2016 Index.
There are additional perks when setting up a business in Australia. Take for example the office spaces have good rates, the labour force is educated and motivated, and the country provides an excellent quality of life. Don’t you find that attractive?
It is very clear that the Australian business sector has a lot to offer to entrepreneurs especially for those who are planning to enter their market. Careful planning will set you up for success in the long run.
Below are the key strategies that can be used to help you in your entry into the Australian market and provide your business a firm foundation.
- Company Registration
- Company Location
- Registered Office Set-Up
- Accounting and Reporting Management
- Business Premises Buying or Leasing
- Insurance Arrangement
It does not matter the type of industry your business falls into or the size of your company, if you plan to enter the Australian market, you need to register that company and comply with the local tax authorities. You can register your business as a branch, trust, company, or partnership and these will have long-term ramifications on the way your business operates.
We advise that you consult with an adviser that understands the ins and outs of Australian business to assist you in providing the best structure that can work best on your current business and future goals.
You may have come across this abbreviation, ABN or what is known as the Australian Business Number where every business needs to acquire as part of the requirement in setting up a legal operation here in Australia.
For any business, the location can also influence the failure or success of a business. Location is crucial especially if you are setting up a storefront and employing many locals, then a nice strategic location is ideal. Thorough market research will require someone to do the groundwork for you with local knowledge.
Additional tips to help you succeed are to research your potential competitors, the demand for your services and products, as well as the current market situation for the type of business like yours. This will help you eliminate any mistakes when you start your business in an area that is heavily saturated with the same businesses or has limited infrastructure.
REGISTERED OFFICE SETUP
When setting up your business, you will need a branch, local, or registered office. You can set the office yourself, or you may prefer to have a local company act as your registered office. The latter option would work well for companies that are just entering the Australian market. This is where the Akiko Group can come into play.
ACCOUNTING AND REPORTING MANAGEMENT
Like any other country, Australia has its own standards when it comes to accounting and reporting making it easier for any business to set up properly. So, when your business accounting system is in line with the Australian reporting standards, then it will be easier to submit, which can help save you more time and money.
BUSINESS PREMISES BUYING OR LEASING
The choice in buying or leasing a commercial property will affect how your business run in the long run. In fact, there are tax implications that come to owning or leasing a property. This is why we recommend that you consult first with a business adviser while you are still contemplating your decision.
Depending on the type of industry that your business belongs to, having insurance is important. You will need to find insurance that slows down risks and assists in the success of your business.
Say, if you plan on hiring more help, then workers’ compensation insurance is required to protect your staff from cases of accidents and sickness.
If your business owns vehicles, then you will need a 3rd party personal injury insurance for that.
Opportunities and Tips
- Global exportation
- Financial Growth
- Export marketing
- Challenges in export promotion
- Export finance and taxation
- Finding your local staff
GLOBAL EXPORTS BEGINS IN AUSTRALIA
According to the Index of Economic Freedom, Australia is found to be one of the easiest placed to conduct business or export products & services. Thanks to Australia’s political stability and regulatory framework, which causes the ease in doing business in the country. All around the world, Australia is considered as one of the most transparent and well-regulated business environments.
Another thing that Australia is known for is its efficient and strong regulatory environments making it a business-friendly place.
When it comes to legal rights, ease of setting up a business, and strong banking systems, it ranks high. In fact, the country ranks 10th in the world when doing business and 4th when it comes to its economy that is like those with large populations. Out of the 189 countries, Australia is 4th in getting credit and 7th when it comes to starting a business.
One crucial factor that created such a high environment is the type of governance in Australia. It has strong governance and is ranked to be one of the best in the world. It allows the country to grow and its economy and offers a provision for financial security. This is what attracts the multinational companies that are looking to tap into new territories to expand their business reach. Australia is the base in the Asian region. A perfect strategic location for businesses.
We all are aware that any business endeavour has its own financial risk, but if in Australia, this is greatly reduced because of the low financial risk factors because its banking and finance regulatory system is ranked high.
If we talked about Australia’s financial assets, it would amount to almost AU$6.4 trillion, which is 4 times Australia’s GDP. This sector has grown 10% annually over the past 2 decades! Imagine that! No wonder why it is one of the highest growth sectors.
It is great to retire in Australia because it is known for the world’s 4th largest superannuation system that might be the major driver
Since Australia is known to possess a strong financial market turnover, businesses are finding themselves making more profit.
As far as the debt securities, Australia stayed on the 3rd largest in the whole Asian region. When it comes to the issuance of international and national debts, Australia is leading and has more international debt securities outstanding than any other Asian nation.
EXPORT PROMOTION CHALLENGES
Even though Australia is said to have many advantages in doing business in Australia, but it still has its own fair share of the hidden challenges. But, with the right support, these challenges can be overcome.
TAXATION AND FINANCE EXPORT
For all companies, tax is always being considered. Australia places a 10% tax on most of the goods and services. We will not touch too much on this as this will require a separate topic.
LOCAL STAFF EMPLOYMENT
According to some researchers, the unemployment rate in Australia is under 5%, which is not bad. Some of these sectors that are having difficulties finding skilled workers are in the mining and oil industries.
To sum it up, the best strategy to enter the market such as visiting the country; the importance of relationships to finding a good partner; the use of agents is what we call a market entry strategy.
To succeed in the Australian market, one is often required to set up a local sales presence, and this would mean appointing an agent or distributor.