Importing can be an excellent way to grow your business; opening new domestic markets, offering new products or services, or reducing manufacturing costs.

Depending on the type of goods and regardless of their value, you may be required to obtain a licence or permit to clear some goods through Customs. You will also need to ensure that the goods comply with safety and information standards.

There is no central body in Australia to assist with importing, however the Australian Border Force provides practical information on importing and buying goods from overseas.

Basic steps for importing goods

More information

• Read more about biosecurity in Australia.
• Learn more about trade measurement if the price of your goods is based on measurement and quality.

IBISWorld is an excellent industry and market research resource that covers over 500 industries in Australia’s economy.

Each IBIS report provides five-year forecasts and includes details of the size, scope, structure of the industry, analyses of the key players and conditions of the industry, daily news and much more.

You are able to access this valuable resource subject to our strict licence agreement with IBISWorld Pty Ltd.

Reports from IBISWorld (in any format, be it a paper copy or electronic copy) cannot be given or distributed to the general public, the business community or for conferences. The reports are for viewing from the screen only. Providers and their clients are required to abide by these licence conditions at all times.

Please note that you will need to register your details once for each new computer before accessing the Industry Reports.

Visit the IBISWorld website

A balance sheet is a snapshot of what a business owns (assets) and owes (liabilities) at a specific point in time.

It is made up of the following three sections:

• assets – including cash, stock, equipment, money owed to business, goodwill
• liabilities – including loans, credit card debts, tax liabilities, money owed to suppliers
• owner’s equity – the amount left after liabilities are deducted from assets

Example of a balance sheet

A profit and loss statement (P&L) is a summary of income and expenses for your business.

The P&L will inform you whether your business made or lost money for the month under review.

Example profit and loss statement

Standard (written) terms and conditions (T&Cs) are the legal basis on which you will be engaging with customers - and are essential when starting a business.

It is recommended that you don’t copy T&Cs from another business; no two businesses are exactly the same, plus they may not have obtained legal advice. You are advised to use a commercial contracts lawyer with experience of your industry to prepare or check your T&Cs. Your lawyer will also ensure your T&Cs meet federal and state laws and any industry regulations.

Why are terms and conditions important?

When drafted correctly, T&Cs:

• are legally binding
• set out the rights and obligations (for you and your customers), relating to the sale of products or provision of services
• outline what customers can expect when dealing with your business and how problems or disputes will be dealt with
• state how and when goods or services should be paid for, and what will happen if payments are not made in line with the contract
• help protect your business and may limit your liability in certain circumstances

Key element of all terms and conditions

All T&Cs must adhere to the Australian Consumer Law (ACL). The ACL is the national law for fair trading and consumer protection, giving you and your customers certain rights and protections. You need to be aware of what it covers as there are penalties if you make claims that are false, misleading or deceptive.

Protection from unfair contract terms

The ACL also protects customers from unfair terms in standard form contracts (these are non-negotiable contracts offered on a ‘take it or leave it’ basis). This will apply to your T&Cs when dealing with individual customers or other small businesses. For further information about unfair contract terms and the types of protections that may apply visit the ACCC website.

Sections frequently included in terms and conditions

• A photograph or written description of your product or service.
• Methods of placing orders.
• Price and payment methods. You may wish to include a price list or quoted price, stating accepted methods of payment, payment terms, and the consequences of late or non-payment. Customers will pay you more promptly if the consequences of them not paying on time are clearly stated (include details about debt recovery, interest, charges and/or cutting off supply of your products or services).
• Warranties and disclaimers.
• Shipping and delivery information, including how any problems will be resolved.
• Website security, particularly in terms of privacy and payment details.
• Period of the agreement and how to terminate the agreement.
• Indemnities and limitation of liability. Your lawyer can advise as to how far you can limit your liability. You cannot exclude your liability from consumer guarantees.
• Returning goods.
• How complaints will be resolved.
• Insurance for goods in transit or in storage, or for services on site.
• The governing laws that may apply.
• The period of notice required for changes to orders.

Privacy policy

If your business collects customer information and credit card details, your T&Cs should outline how you collect, manage and protect customers’ personal information and how long their details will be kept. If you use cloud-based systems, you should know where your data is located, (within or outside Australia) and mention this in your privacy policy. You may want to refer customers to a separate privacy policy displayed on your website.

Website terms and conditions

If your business has a website you will need to include specific clauses in your T&Cs. These can include:

• which protections are in place against misuse of your service or stealing your content
• a statement of ownership of any and all content posted on the website, along with the right to reproduce or share this content
• intellectual property protections such as copyright, trademarks or patents
• a disclaimer about the information on your website, such as not being liable for accuracy
• disclosing any advertiser relationships
• any accounts or subscriptions offered on your website, terms of their use and how they can be terminated

You may want your T&Cs to pop-up when a user first visits your website. You can also make it required information to read before they can progress further on your website.

General tips for terms and conditions

Accepting your terms and conditions

It is good practice to have customers sign acceptance of your T&Cs before you provide them with any goods and/or services. If a customer refuses, seek feedback about their concerns.

Keep them simple and accurate

Poorly worded and incorrect T&Cs could cause you financial loss and stress, and unhappy customers. Your T&Cs should:

• be written in plain English that is easy to understand (if you can’t follow what a term or condition means, it is unlikely your customers will be able to)
• not contain misleading statements
• not be considered ‘unfair’

Format, location and accessibility

Carefully consider the format, location and accessibility of your T&Cs. This will have an impact on their effectiveness, plus how (legally) binding they are. Your T&Cs should be clearly stated on all quotes, estimates, contract and related documentation.

Not providing the T&Cs of a sale of a product or service to your client before or during a transaction could affect your ability to enforce them at a later date.

How and where you present your T&Cs is very important; having everything on one page in tiny print will not endear you to your customers and may have legal consequences.

In addition to helping you to draft appropriate T&Cs for your business, your legal adviser should also recommend how they could be included in the overall sales contract.

More information

For further information or questions on establishing terms and conditions for your business, call 133 140 to speak with one of our experienced small business advisers.

Note: This information is not a substitute for legal advice.

Keeping proper records and understanding financial reports are vital for understanding the financial state and cash flow of your business. 

Budgets and forecasts

Financial forecasts assist you to meet your business goals. They are a future prediction of your business finances, as compared with statements, which provide details of actual results or progress.

Predicting the financial future of your business is not easy, especially if you’re starting a business and don’t have a trading history. However, forecasting and making adjustments frequently will enable you to become more accurate.

Monthly or weekly forecasts may be necessary when starting your business, experiencing rapid growth, or having financial difficulties. Regular forecasts allow you to closely monitor your finances and develop strategies to fix problems before they become major issues.

Monthly or quarterly forecasts may be more appropriate for a stable, established business. Financial forecasts may include the following.

Profit and loss (P&L)

Usually produced monthly, this is a summary of income and expenses for your business. The P&L will inform you whether your business made or lost money for the month under review.

A P&L usually has five main components:

• revenue (sales/turnover)
• cost of goods sold (COGS)
• gross profit (revenue minus COGS)
• expenses
• net profit (gross profit minus expenses)

Formula: Sales – COGS = gross profit – expenses = net profit

The net profit will show whether your business has earned or lost money. When reviewing your P&L it is useful to analyse four key benchmarks or performance indicators (KPIs).

Gross profit is an indicator of efficiency. The higher the gross profit margin the better, as your business keeps more from each dollar of sales. If your gross profit margin decreases over time you will need to determine the reason and take action to address the decline.

The net profit margin is an indicator of how much profit you make (before tax) from every dollar you spend. A fall in net profit margin generally means you are paying more in expenses, which needs to be monitored. More profitable businesses generally spend less of their income on expenses.

View our example profit and loss statement

Your business structure will determine how some expenses are calculated. Your accountant can provide detailed advice regarding your structure.

Sole traders – drawings (money taken by the owner for personal use) are not an expense. You pay tax on the net profit regardless of how much you have taken in drawings.

Partners – if there is a partnership agreement, net profit is allocated according to the proportion set out in the agreement. If there is no agreement, net profit is shared equally between the partners. Each partner pays tax on the amount of net profit they receive, regardless of how much the partner may have taken out as drawings.

Companies – salaries for working directors are treated as an expense along with employees’ wages. Net profit is available for distribution to shareholders as dividends. Net profit and taxable income can be different because for tax purposes some expenses may or may not be allowable and some income may be assessable or not assessable.

Balance sheet

A balance sheet is a snapshot of what a business owns (assets) and owes (liabilities) at a specific point in time. A balance sheet is usually completed at the end of a month or financial year and is an indicator of the financial health of your business.

A balance sheet is in three sections:

• assets – including cash, stock, equipment, money owed to business, goodwill
• liabilities – including loans, credit card debts, tax liabilities, money owed to suppliers
• owner’s equity – the amount left after liabilities are deducted from assets
• Assets and liabilities are divided into current (short-term) and non-current (long-term) as shown below:
  • Current assets: Items of value that are expected to be consumed or converted into cash within the next 12 months, such as stock that turns over regularly and payments from debtors.
  • Non-current assets: Items not expected to be consumed or converted into cash within the next 12 months, such as equipment, vehicles, buildings, and goodwill.
  • Current liabilities: Items expected to be paid within the next 12 months, such as credit card debts, tax owed, short-term loans, and stock purchases.
  • Non-current liabilities: Items not expected to be settled within the next 12 months, such as mortgages on buildings and long-term loans.

View our example balance sheet

Financial health indicators

Your P&L and balance sheet can be analysed in more detail to determine key performance indicators (KPIs) as outlined below.

Registering for tax

To ensure you are complying with all regulations it is important to know which registrations apply to your business.

The most common registrations required by small business are:

Types of tax

Businesses may have other tax obligations, including:

More information

Visit the ATO website to:

• Find out more about GST and PAYG withholding
• Do the free short courses in their online learning platform essentials to strengthen your small business
• Watch their Tax basics for small business videos
• Learn more about their in-house facilitation service for businesses with a tax or super dispute

At some stage your business is likely to receive a customer complaint. Dealing with it in a positive and constructive manner will help to keep your customers.

In general customers who are unhappy with your product or service will not complain to you – but they will complain to others and take their business elsewhere. Managing customer complaints and resolving them quickly will result in improved business processes and repeat business.

Complaints handling policy

Develop a complaints handling policy. It should include reassuring customers that you value their feedback and you are committed to resolving their issues in a fair, timely and efficient manner.

It should also:

• explain how customers can make a formal complaint
• identify the steps you will take in discussing, addressing and resolving complaints
• indicate some of the solutions you offer to resolve complaints
• inform customers about your commitment to continuous improvement

Complaints handling procedure

Once you have developed a policy you can create a procedure for handling complaints. A procedure will ensure complaints are dealt with the same way, every time. The procedure should be easy to understand and follow by all your staff.

Your procedure could include the following steps.

More information

• Learn more about attracting, managing and keeping customers at Business.gov.au.
• The Australian Competition and Consumer Commission (ACCC) have information on consumer rights and guarantees.