There is no doubt that the ways we have run business have drastically changed in the past decade, and much more rapidly in the past few years. Customers have experienced quicker, more convenient ways how to get hold of their favorite products, even if they were sold in another country. But for business people, and aspiring business owners, the landscape also has opened up tons of opportunities for them to begin their ventures via the groundbreaking world of e-commerce.
This is why many business owners decide to bring their brands online. Some just place online counterparts to cover the market, while others migrate their business online. Some startups also have that great opportunity to begin selling online, in a bid to showcase their product’s qualities and selling points, hoping to become a trusted and established brand.
In just a few years, Australia has established a growing e-commerce market which is estimated now as worth USD 40.9 billion (as of 2021), putting it in the 13th place among all the world’s countries in terms of online selling and buying. In 2022, more than five million Australian households engage in online shopping per month. These numbers only prove that e-commerce is booming in OZ.
But how does one start an online business? Does it require a permit? And what do you have to accomplish in order to get your engines ready and propel your product into the vast world of e-commerce? Let us help you get a grasp of that through this article. We tell you, step by step, how to get there.
Choose a company name
When we’re here in the first step of your online business registration, we assume that by now, you have already firmed up the product, set of products, or their variety, that you plan to sell through your online channel. Once this is decided, things will be easier and you’re just treading a solid line of planning and implementation.
A company name is your legal identity. There are times when the official or legal company name differs from the brand name, but for single-brand companies, it serves some purpose if you align them with each other. Once you decide on a company name, this will be your company’s identifier through all transactions involved in your business process.
In Australia, you can use either
- A name you’ve chosen for your company
- A name that you have reserved prior in the Australian Securities and Investments Commission (ASIC), or
- Your Australian Company Number (ACN), if available.
Just a few pointers in choosing your company name:
- Make sure the name is not identical to the name of another company
- As of May 2012, the ASIC’s national register does not allow identical names for businesses in Australia. Prior, such cases were allowed to exist as long as businesses with identical names operate in different states
- Be mindful of using trademarks, copyrights, and other terms which may require legal permission such as “bank, trust, Royal” among others.
Know your responsibilities
Starting and registering an online business also means adding more responsibilities and duties for you to fulfill. Taxes, requirements, reports – you need to cover all that. You can be a sole proprietor or you can register your company as a corporation with your chosen partners and investors.
A sole proprietorship is much simpler, but in the event that a corporation is what you want to register. Either way, any company must have a director that is obliged to comply with Australia’s Corporations Act. You have to be familiar with the legal obligations that come with operating a company to avoid any unintentional violations. These range from proper identification, a statement of assets, your company structure, and a systematic safekeeping of company records.
Apply for a Director ID
When you yourself decide to start a business, or your corporation appoints a director, that person must apply and acquire a director ID. A director ID is your unique identifier who has verified their identity with the ASIC. The Australian government has set up this system to help curb fraudulent activities in commerce and e-commerce.
The good news is once you apply and your ID is granted, the effectivity is for a lifetime. It’s fairly easy to apply for the ID and you can do it online. Once you have your director ID, it will contain all your pertinent information. You can also view, update and manage your details through the online portal from point of issuance and thereafter.
Prepare registration costs
The overall costs of registering your online business start from around AUD 443-538, which varies depending on the type of company that you are trying to register. Some more complicated registrations incur more fees, so it’s best to check out the ASIC’s list on their website. If you have rather particular considerations about your business, you may contact the ASIC’s office to inquire.
Register your online business
Aside from your director ID, you must also have an Australian Business Number (ABN) for your online business to operate. An ABN is a unique 11-digit number assigned to your company that can be used to:
- Identify and distinguish your business from others when ordering and invoicing
- Avoid pay-as-you-go (PAYG) tax on the payments you get
- Claim goods and services tax (GST) credits
- Claim energy grants credits
- Get an Australian domain name
For your online business, it is imperative to get an ABN assigned to your company as this will allow you to acquire an Australian domain name. You can apply for an ABN online through this website run by the Australian government.
Take note that while you need an ABN to comply with other business requirements, there are separate applications for energy grants and goods and services taxes.
The Australian Company Number (ACN) is a distinct application from the ABN. ACNs are a 9-digit number and are a requirement for all corporations (for-profit, non-profit, etc) but only business enterprises need to apply for an ABN. In the case of your online business, best to apply for both, which you can easily do via the online registration form found on the Australian government website for businesses.
Via this registration form, you can also determine all other necessary requirements, and other helpful tools you can avail from the government in running your online business. You only have to answer the simple survey questions detailing and describing your prospective business. This is pretty helpful as it serves as a short, online in-take interview where government bodies advise you on the licenses, permits, and other requirements you have to accomplish to ensure your online business goes smooth sailing after registration.
Once your application is approved, you will be getting your unique numbers and a corporate key which you will use to access the portal to manage your details as a duly-registered business in Australia.
If you need some extra help registering your online business, you might want to pay a fee to a private service provider (PSP) such as an accountant, your solicitor, or another business that provides online services with ASIC.
Build your website
Of course, you’ll be needing a website for your online business – that’s just how it works! You have to have a website that corresponds with your brand. And if you’re planning to delve primarily in the domestic Australian market, you can opt to have a “.au” domain website which you can access when you have an ABN. After acquiring a domain name, the next step is to populate your website and not many of us have the personal capacity to build our own websites.
Marketplace hosting sites such as Shopify and WooCommerce can be of great help in such cases. They have their own templates which you can customize, along with app plug-ins which you can switch on or off depending on your specific needs. The main perk of availing these services is their marketplace catalog and other product listing features.
If you’re just beginning to delve into online business for the first time, it’s best to start small – with one or two best e-commerce platforms in Australia just to test the waters. Once you’ve gotten the hang of it, and you’ve built your own internal business systems and processes, you can then choose to expand to other platforms. However, many business owners experience troubles managing different marketplaces all at once, especially when they have different features and interfaces. A logistics engine service can come handy when you encounter such problems. Logistics engines like Locad provide an omnichannel solution which integrates all your marketplaces into one command center, along with integrated solutions for fulfillment and logistics.
Protect your intellectual property
Some of the best businesses are founded on ideas – be it a specific product concept, a new service, a goal or central message that is enshrined in your company operations or whatnot. And ideas are a great selling point for most. In such cases, you want to protect that the ideas you have and our putting into your business cannot be easily taken advantage without your express permission.
In that event, you have to register a trade mark for your company name, brand identity or other similar aspects which you seek to be identifiable to your company or brand. Registering your online business does not automatically grant you exclusive rights to the words that make up your company/business/brand name. You’d have to register trade marks separately through. Once you trade mark a name, word, or logo, you’d have the authority to use and license others to use your brand. But beware, your ideas might not be so original and others might have trademarked them. Check out the trade mark tracker of the Australian government online just to be sure.
Annual statements and renewal
After the annual review date (which is usually the corresponding date of your registration in the following year), you will receive an annual statement from the ASIC. It is important to await this document and fulfill the requirements that come with it promptly to ensure the continuing registration of your business.
Your annual statement usually contains:
- A statement of your company’s current details
- An invoice for your company’s annual review fee and;
- Your company’s corporate key
To renew your registration and continue the legitimate operations of your online business, you must accomplish the following:
- Pay your annual company review fee
An invoice will be included in your annual statement which will include the fee you have to pay depending on your business enterprise. Take note the deadline and pay on time to avoid incurring late payment fees.
- Check and update your company details
In this step, you can change any of the major details that you have registered with your company prior in case a change has been made since the last update. To be able to access change detail forms, you need to get hold of your corporate key which can also be found at your annual statement package.
- Pass a solvency resolution
A solvency resolution is not necessary if you regularly lodge your financial statements with the ASIC. In the case you need to file it, a solvency resolution serves as a declaration from your directors on whether or not you can pay your debts in the time they are due. The solvency resolutions can be positive or negative.
Run your website, promote your business, start selling online
Once you’ve got all registered and you have prepared your website’s launching interface and layout, then all you have to do is announce that you’re already selling! Before site launch, it’s also a good idea to couple it with social media accounts on Facebook, TikTok, Instagram and others. With these social media accounts, you also can create e-commerce marketplace profiles where you can mirror your product listings, allowing for more options through which customers can buy your products.
Where your business will go will definitely and ultimately be up to how much effort and insight you put in. So, we encourage to learn from the most successful ones while leaving a healthy allowance for exploration and breakthroughs. Who knows, while you’re just starting in Australia, you can expand and explore the world through your online business? Best of luck!
