Guide to Small Business

Often, businesses are the best investments. We regularly recommend clients buy or start businesses, or further develop existing ones, wherever a client is suited to this by inclination, personality, or training. The extra economic benefits, improved tax planning and, hopefully, the Capital Gains Tax (CGT) free profit on the ultimate sale mean this is an option clients cannot afford to overlook.

In this updated ebook, we look at three particular aspects of a successful modern business. These are:

1. The business plan
2. Staffing
3. Time management

The list of things that could be included in an ebook about business is almost endless. However, our experience is that these three elements are the ones that need the most attention. Happily, they are also the ones where improvements – even little ones – make large differences. So, like all good plans, let's start at the beginning...

A successful business doesn't happen by accident. It's the result of a good idea, implemented systematically over time, according to a pre-conceived plan. This is true whether you're starting from scratch or taking an established business into a new phase of growth. It's also true regardless of your business's location, competition, or the post-pandemic economic landscape.

A good business plan reflects the owners’ personal preferences and ambitions. It accommodates their private lives and, by anticipating expected problems, helps to reduce future stress. If there's a plan for what's going to be done and why, it will likely be implemented more successfully and with much less angst. For example, a good business plan will cater for peak workloads by introducing new support staff or technology well before the peak arises.

Sometimes the plan is just in the owners’ heads. They have strong views on what will work and they set about doing it. That's commendable, and there are many examples where this has worked well. However, the prospects of good results are greatly increased, and the prospects of bad results are greatly decreased, if the plan is documented. This should be done in a disciplined and structured way, identifying what should and shouldn't be done, who will do it, and why.

Even if you're the only one who will ever see it, writing your plan down makes it more concrete and helps you spot gaps or weaknesses.

It's a good idea to analyse and check the plan regularly. How often depends on the circumstances. For stable businesses, once a year might be fine. For businesses experiencing rapid change, a quarterly or even monthly review might be necessary. Monitoring and updating the business plan is an intrinsic part of building and maintaining a successful business.

Owners can choose to develop their own business plan or seek help from a consultant. The following table lists the pros and cons of each option:

Of course, a combination of both options is often the best path.

Getting started

A well-executed business plan should maximise business profit. This, in turn, will maximise the goodwill in the business.

Start with a vision. Planning can't happen without one. Formalising the process helps turn abstract ideas into a practical reality. This formal statement is called a “vision statement” and is usually kept short and simple to best express the core ideas about the business's future direction.

To help create a vision statement, owners should first establish a set of principles and values that will underpin their business. Once the principles and values are developed, reflect on what each one means:

• what each value is about and what it really means
• whether it is fully understood by staff and clients
• what other ideas are associated with each value

The values can then be translated into a set of principles and standards of behaviour and incorporated into the vision statement.

Thinking about the clients

An ethos of client care and support should dominate the plan. If this occurs, the business should flourish by all measures of success, especially client service and profitability.

You'll need to define the demographics of your business. The planning process should then be developed around meeting the needs of those clients. In today's market, this goes beyond simple demographics. Consider the entire customer journey:

• How do clients first discover you? (e.g., Google search, social media, word of mouth)
• What is their experience when interacting with your website, social media, or physical store?
• What is the purchasing or service delivery process like?
• How do you follow up and encourage repeat business?

Using analytics from your website and social media can provide powerful insights into your client base.

Thinking about the owner

A good business plan reflects the personal preferences and ambitions of the owners. Apart from setting goals, the plan must also accommodate their private lives. The process of preparing a business plan allows owners to identify what's important to them and ensure their preferred lifestyle is considered. For example, the needs of a young family might dictate the hours the business is open.

The business plan process often presents a good opportunity for reflection on the priorities of the business owners – and for thereby ensuring congruence between personal and professional goals.

In our observation, this is one of the most poorly recognised elements of a business plan. Too many owners let their private lives run second to the business, thinking the business is necessary for the family to flourish. While true, factoring the family into the business plan keeps personal responsibilities in focus.

Put simply: too many parents miss too many school concerts or football games. A plan helps prevent that.

What a business plan looks like

There's no single standard format. A business plan should be flexible, reflecting the needs of the people who created it. It can be long and detailed or focused solely on the big picture.

However, using a template can help develop a logical strategy, especially if a third party like a bank or investor will see it. One suggested structure is set out below.

Executive Summary

This is a concise overview of the entire plan. Although it appears first, it's always written last. It should highlight the purpose of the business, its target market, competitive advantages, projected profits, and capital needs.

Mission

The mission statement provides a succinct outline of the business’s purpose. It defines the business’s goals, objectives, and values.

Business position

This section determines where the business stands in relation to its competitors. It involves a close examination of client profiles, competitor activities, and the overall market. In 2025, this must include an analysis of your digital position:

• Who ranks higher than you on Google for key search terms?
• What is their social media presence like?
• What are their online reviews saying?

We generally urge caution with external market researchers; they can be expensive and can't replace the owner's intimate knowledge of their clientele.

Organisational strength

Here, you analyse the internal and external factors affecting your business.

• External factors (often uncontrollable): Legislation, economic trends (e.g., inflation, interest rates), demographic shifts, technological advances, and sustainability expectations.
• Internal factors (controllable): Your team's skills, financial resources, physical premises, business systems, and your digital infrastructure, including cybersecurity protocols to protect your business and client data.

Strategic audit

This is where you perform the classic SWOT analysis to review the Strengths, Weaknesses, Opportunities, and Threats affecting the business. This analysis helps you identify the critical success factors required to gain a competitive advantage.

Functional strategies

It is now time to develop the specific strategies to meet your goals. Each strategy should follow the SMART principle:

The person responsible for implementing the strategy also needs to be identified. Common strategies include:

• An operating strategy – how the business will run day-to-day.
• A financial strategy – budgets, cash flow projections, pricing, and funding.
• A marketing strategy – A modern plan must be integrated. How will your traditional marketing (e.g., signage) support your digital marketing (e.g., social media, SEO, email campaigns), and vice versa?
• A resources strategy – staffing needs, technology stack, and other resources.

Implementation

This is the action plan. It details the specific tasks, assigns responsibilities, sets deadlines, and establishes Key Performance Indicators (KPIs) to track progress.

A simpler alternative

The template above is comprehensive. Many businesses prefer something simpler. If so, follow Einstein’s maxim:

"Everything should be made as simple as possible, but not simpler."

A basic plan must address four key themes:

• Where is the business now? (Your current situation)
• Where could the business be? (Your vision and goals)
• How do you get there? (Your strategies and tactics)
• How will you know when you've arrived? (Your metrics for success)

More Information

The Australian Government's business.gov.au website is an excellent resource. It offers a free business plan template and guide, along with a wealth of other information for starting and growing a business. You can find it here.

Virtually all businesses employ staff, making human resource management a vital process. This has become even more critical in the modern workplace, with an increased focus on flexibility, culture, and employee well-being. Businesses have legal obligations to fulfil while also needing to build a positive and cooperative culture.

This chapter focuses on the modern recruitment process and key legal obligations in Australia.

Recruitment process

The relationship with your employees is shaped from the very first interaction. A clear, compliant recruitment process is essential.

The procedure should be documented and cover:

• Recruitment and selection procedures (including diversity and inclusion principles)
• Personnel records for each employee
• Employment contracts
• Onboarding and induction procedures
• General conditions of employment
• Leave entitlements
• Termination procedures
• Remuneration and benefits
• Equal opportunity, anti-harassment, and psychological safety policies
• Training and development procedures
• Performance review processes
• Internal grievance resolution procedures

Businesses need robust strategies for employee retention. This isn’t about being best friends; it's about fostering mutual trust, respect, and accountability. In today's market, employees expect:

• Job satisfaction and meaningful work
• A genuine work/life balance
• Flexible working conditions (e.g., remote or hybrid options)
• Open and transparent communication
• A positive and inclusive workplace culture
• Recognition and appreciation
• Fair and appropriate rewards
• Psychological safety (the ability to speak up without fear of punishment)

The rise of remote and hybrid work models means businesses must also consider how to manage and engage a distributed team, maintain a strong culture, and provide the right technology and support.

The Fair Work Act 2009

The Fair Work Act 2009 is the main legislation governing the employer-employee relationship in Australia. It provides a safety net of minimum entitlements, enables flexible working arrangements, and promotes fairness at work. While the Act is from 2009, it is frequently amended. It is crucial to stay up-to-date with changes.

Key areas covered by the Act include:

• The National Employment Standards (NES)
• Modern awards system
• Minimum wage
• Unfair dismissal protections
• Rules for enterprise agreements
• Record-keeping and payslip obligations

The government's Fair Work Ombudsman is the primary resource for employers. Their website (www.fairwork.gov.au) has up-to-date information, tools, and calculators.

Types of employees

When recruiting, it's vital to correctly classify employees. This should be stipulated at the time of engagement and confirmed in the employment contract.

Full-time employees

A full-time employee works, on average, 38 hours per week. They are engaged on an ongoing (permanent) basis or for a fixed term and are entitled to all NES benefits like paid annual and personal leave.

Part-time employees

A part-time employee works, on average, less than 38 hours per week with reasonably predictable hours. They receive all NES entitlements on a pro-rata basis.

Casual employees

A casual employee has no firm advance commitment to continuing and indefinite work according to an agreed pattern of work. They are paid a higher hourly rate which includes a 25% casual loading in lieu of benefits like paid sick and annual leave. Since 2021, casual employees who have worked for 12 months and meet certain criteria have a right to be offered or request conversion to permanent employment.

To find out more about the different types of employees refer to: Fair Work Ombudsman – Types of employees.

National Employment Standards

The NES are 11 minimum entitlements that must be provided to all national system employees. An award, employment contract, or enterprise agreement cannot provide for less than the NES.

1. Maximum weekly hours: 38 hours per week, plus reasonable additional hours.
2. Requests for flexible working arrangements: Certain employees can request changes to their work arrangements. Employers must respond in writing within 21 days and can only refuse on reasonable business grounds.
3. Parental leave and related entitlements: Up to 12 months of unpaid parental leave, with the right to request an additional 12 months.
4. Annual leave: Four weeks of paid leave per year, paid pro-rata for part-time employees.
5. Personal/carer’s leave and compassionate leave: 10 days of paid personal/carer's leave per year. 2 days of compassionate leave per occasion.
6. Paid Family and Domestic Violence Leave: A crucial update. All employees (including part-time and casual) are entitled to 10 days of paid family and domestic violence leave in a 12-month period. This is a standalone entitlement and does not accrue.
7. Community service leave: Unpaid leave for voluntary emergency management activities and paid leave for jury duty.
8. Long service leave: An entitlement based on state or territory legislation.
9. Public holidays: A paid day off, except where reasonably requested to work.
10. Notice of termination and redundancy pay: Minimum notice periods for termination and redundancy pay based on length of service.
11. Fair Work Information Statement: Employers must give every new employee a copy of this statement before, or as soon as possible after, they start their job. It can be downloaded from the Fair Work website.

Paid Parental Leave Scheme

The Australian Government's Paid Parental Leave scheme provides financial support to eligible working parents.

• Parental Leave Pay: Provides up to 20 weeks of pay at the national minimum wage rate for eligible parents of newborn or newly adopted children. This entitlement is flexible, with parents able to share the weeks and claim in blocks.
• Eligibility: The claimant must be the primary carer, meet residency requirements, have met the work test, and have a family income under the current threshold (which was $350,000 per family as of 1 July 2023, but you should always check the Services Australia website for the latest figures).
• Employer's Role: In most cases, the employer provides the Parental Leave Pay to their long-term employees and is reimbursed in advance by Services Australia. This means there are no cash flow issues for the business.

For further information on this scheme, refer to: Paid Parental Leave Scheme for Employers.

Employment contracts

A written employment contract is crucial. It should clearly state the terms of employment and must be consistent with the NES and any applicable modern award. A contract cannot undercut minimum entitlements.

Be very careful when paying an "all-inclusive" or "over-award" salary. A general statement that the salary covers all entitlements is not sufficient. The contract must specify exactly which award entitlements (like overtime, penalty rates, and allowances) are being "bought out" by the higher rate, and the employee must be better off overall than they would be under the award.

Discipline and termination of staff

Disciplinary action must be handled fairly and for a valid reason. It's essential to have a clear, documented procedure.

1. Documentation: Assume every action will be scrutinised later. Document everything in writing—discussions, warnings, specific examples of underperformance or misconduct.
2. Investigation: For performance issues, talk to the employee. Explain the problem clearly and give them a chance to respond. Often, a frank conversation is all that is needed.
3. Progressive Discipline: If the issue persists, implement a performance improvement plan with clear, measurable goals and a timeline. This should be documented and agreed upon. If there is still no improvement, a formal written warning may be necessary.
4. Dismissal: This should be the last resort (except in cases of serious misconduct). If warnings and support have not worked, termination may be necessary. It's wise to seek professional advice from an employment lawyer or Fair Work before taking this step.

Serious Misconduct

Serious misconduct is behaviour that is so severe it would be unreasonable to require the employer to continue the employment (e.g., theft, fraud, assault, or a serious breach of safety procedures). In these cases, you can dismiss an employee without notice, but you must conduct a fair and thorough investigation first.

Unfair dismissal

An employee is protected from unfair dismissal if their dismissal was harsh, unjust, or unreasonable. To be eligible to make a claim, an employee must have completed a minimum employment period and be under the high-income threshold.

• The minimum employment period is 12 months for small businesses (fewer than 15 employees) and 6 months for larger businesses.
• The high-income threshold is indexed annually (it was $167,500 per annum as of 1 July 2023, but check the Fair Work website for the current figure).

The Small Business Fair Dismissal Code

Small businesses have some protection if they follow the Small Business Fair Dismissal Code. If a small business employer strictly follows the Code, the dismissal will be deemed fair. A copy of the Code and a checklist are available here: Small Business Fair Dismissal Code.

For more information, refer to the Fair Work Commission's Unfair Dismissals Benchbook.

This section introduces the timeless concept of time management and identifies areas where busy business owners can better balance the demands placed upon them, updated for the distractions of the modern digital world.

Two classic books in this area are The Effective Executive by Peter Drucker and The Time Trap by Alec Mackenzie. Their principles remain profoundly relevant.

Licensed by Google

The Biggest Time Wasters (and How to Beat Them)

Meetings

Surveys suggest half the time spent in meetings is wasted. In our digitally connected world, "meeting fatigue" is a real problem. Before calling or accepting a meeting, ask:

• Is this meeting necessary? Could this be an email, a shared document, or a quick message on a platform like Slack or Teams?
• Who really needs to be there? Don't invite people out of courtesy.
• Is there a clear agenda and objective? Circulate an agenda with time allocations beforehand and stick to it.
• Could it be shorter? The default 60-minute meeting is rarely necessary. Try 25 or 45 minutes instead.

The Telephone & Digital Communications

The phone, email, and instant messaging are powerful tools but also massive sources of distraction.

• Screen your calls. Have a system (or a person) to filter calls so only urgent and important matters get through immediately.
• Batch your communications. Instead of reacting to every ping and notification, set aside specific times in the day to check and respond to emails and messages. Turn off notifications outside these times.
• Be direct. Start calls with "What can I do for you?" to focus the conversation. Use clear closing lines like, "Great, so the next step is X. I'll let you go now."

Ineffective Delegation

Delegation is an art and an essential feature of all good businesses. Effective delegation means empowering your team, not just offloading tasks.

• Delegate outcomes, not processes. Focus on the desired result. If a team member finds a better way to get there, that's a win.
• Expect small mistakes. They are learning opportunities. Look at the system, not the incident. Is the process flawed? Is more training needed?
• Hire people you can trust. If you can't trust your staff to do the job, you either have the wrong staff or the wrong mindset.

Paperwork & Digital Clutter

The problem with paperwork is the time it takes to create, read, file, and find. The same is true for digital files.

• Handle it once. When a document or email comes in, decide immediately: delete it, delegate it, do it (if it takes <2 minutes), or defer it (schedule a time to handle it).
• Go digital, but stay organised. Use scanners and cloud storage to reduce physical paper. However, you must have a logical and consistent digital filing system (e.g., using platforms like Google Drive, Dropbox, or SharePoint).
• Use templates. Create standardised forms, email responses, and documents for recurring tasks to save time and ensure consistency.

Procrastination and Lack of Focus

The modern world is designed to steal your attention. Self-discipline is about intentionally managing your focus.

• Set clear goals. Use your business plan to set long-term, short-term, and daily goals. Write them down. A to-do list is a simple but powerful tool.
• Distinguish urgent vs. important. The Eisenhower Matrix (above) is a great tool for this. Focus your energy on what's important, not just what's screaming for your attention.
  
• Practice "Deep Work." This concept involves scheduling blocks of time for focused, uninterrupted work on your most important tasks. This means no email, no social media, and no phone calls.
• Use technology to fight technology. Use apps that block distracting websites, manage your tasks (like Asana, Trello, or Monday.com), and help you focus.

Socialising

Workplace socialisation is the lubricant that maintains good relationships. However, studies show a huge amount of an executive's time can be spent on non-business interactions. It's about finding the right balance. Be friendly and approachable, but learn to politely excuse yourself from conversations that are drifting.

More Tips for Modern Time Management

• Utilise Technology Wisely: Leverage modern tools for efficiency. Video conferencing platforms like Zoom, Google Meet, and Microsoft Teams have made remote collaboration seamless, saving immense travel time. Project management software can keep your team aligned, and cloud accounting systems (like Xero or MYOB) automate financial tasks.
• Prioritise Ruthlessly: Successful leaders don't do everything; they make sure everything important gets done. This means saying "no" to things that don't align with your priorities. Do one important thing at a time, and do it well.
• Schedule 'Buffer' Time: The unexpected will always happen. Schedule blank blocks of time into your week to handle urgent tasks that pop up, so they don't derail your entire plan.
• Monitor Your Progress: Regularly review how you're tracking against your goals. Are you spending your time on the right things? A simple end-of-day review (What did I achieve? What's the plan for tomorrow?) can make a huge difference.