25 Questions to Ask Yourself Before Starting a Business
Most businesses that fail were doomed before they opened — not because the owner was lazy, but because nobody asked the hard questions early. These 25 questions are the ones a good accountant or an honest mate would put to you before you spend a dollar. Answer them properly, then turn the answers into a plan — the last section shows you where.
The idea
1. Will people actually pay for this?
Not "would they like it" — will they hand over money? Compliments are free; sales are proof. A good answer sounds like "three people have already pre-ordered" or "my old employer's clients keep asking me to do this on the side", not "everyone I've told loves the idea".
2. Who exactly is your customer?
"Everyone" is the wrong answer. The tighter your target — tradies in outer Brisbane who hate paperwork, time-poor parents in a specific suburb — the cheaper your marketing and the sharper your offer. If you can't describe one specific person who has this problem, you don't understand the market yet.
3. What makes you genuinely different?
Cheaper, faster, closer, better service, a niche nobody serves — pick something and be able to say it in one sentence. "I'll just do a good job" isn't a difference; every competitor says the same thing. A good answer is one a customer would repeat to a friend.
4. Have you tested it with real money on the line?
Before committing your savings, run the smallest possible version: a market stall, a weekend of paid jobs, a landing page taking deposits, ten sales on Facebook Marketplace. A test that costs $500 and two weekends can save you $50,000 and two years. If the small version can't find buyers, the big version won't either.
5. Can you explain it in one sentence?
"I help X do Y so they get Z." If your pitch needs three minutes and a diagram, customers will switch off before you finish. Clarity here also forces clarity everywhere else — pricing, marketing, who you say no to.
The money
6. What will it cost to get to your first sale?
List everything: equipment, stock, insurance, registrations, website, tools, vehicle, initial marketing. Then add a buffer, because first-timers reliably underestimate. A good answer is a written list with numbers next to each line, not a figure you did in your head.
7. How long can you live without a wage?
Most new businesses take months to pay their owner anything. Work out your household's bare-minimum monthly cost, then count how many months of savings (or partner income) you have. Less than six months of runway means you're betting on everything going right immediately — and it won't.
8. When — and how — will you pay yourself?
Decide upfront: a set weekly amount once revenue supports it, not "whatever's left in the account". Businesses where the owner draws money randomly are the ones that hit BAS time with nothing in the tank. Put a target date on your first pay day and treat it as a milestone.
9. What is your break-even number?
The revenue per month where you cover every cost, including your own wage. If your break-even is $12,000 a month and that means 40 jobs at $300, ask honestly: can you win and deliver 40 jobs a month? If the maths only works at full capacity from day one, the maths doesn't work.
10. Where is the startup money coming from?
Savings, a redundancy payout, a partner's income, a bank loan, family money, or keeping your day job while you build — each has a different risk profile. Borrowed money adds a repayment to your break-even; family money adds Christmas-dinner tension if it goes wrong. A good answer names the source, the amount and what happens if you lose it.
11. Who is keeping the books?
From your first invoice you need records the ATO will accept, and from $75,000 turnover you must register for GST and lodge BAS (as at August 2026). Decide now whether that's you with software, a bookkeeper, or an accountant — "shoebox of receipts, sort it at tax time" is how people end up with debts they didn't see coming.
The structure
12. Sole trader, company or trust?
Sole trader is cheap and simple but your personal assets are on the line; a company costs more but caps your liability and suits growth. Most people start as sole traders and restructure later — but if you're taking on real risk or partners from day one, get advice first. Our guide to choosing a business structure walks through the trade-offs.
13. What will the registrations actually cost?
Less than most people think. Here's the short version:
| Registration | Cost |
|---|---|
| ABN | Free |
| GST registration | Free |
| Business name (ASIC) | Under $50 a year — check the current fee on asic.gov.au |
| Company registration (ASIC) | $636 (as at August 2026) |
The ABN is free and takes minutes — see how to register an ABN. Be wary of websites charging to "help" with free registrations.
14. What licences do you need?
Depends entirely on your industry and state: food businesses need council registration, trades need licences, anyone serving alcohol needs a liquor licence. Run your business type through the Australian Business Licence and Information Service (ABLIS) on business.gov.au before you start — operating unlicensed can mean fines and, worse, uninsured work.
15. Is the name available — everywhere it matters?
Check four places: ASIC's business name register, the .com.au domain, the social handles you'll use, and IP Australia's trade mark register. A name that's taken as a trade mark can force an expensive rebrand later. Do the twenty minutes of checking before you print anything.
16. What happens when something goes wrong?
Public liability, professional indemnity, tool or stock cover, income protection — which ones does your business actually need? One uninsured incident can end a sole trader, because your house is in the firing line. A good answer is a quote from a broker, not "I'll sort insurance once I'm busy".
The market
17. Who else is doing this, and why do their customers stay?
Competitors existing is good news — it proves demand. Study the three nearest ones: what they charge, what their reviews complain about, why customers stay anyway. The complaints in their Google reviews are a free list of ways to win their customers.
18. Is the demand seasonal?
Landscaping dies in winter, tax work explodes in July, retail lives or dies on Christmas. If your revenue will swing, your runway from question 7 needs to cover the quiet months, and you need a plan for them — a complementary service, or costs that flex down. Getting caught by your first quiet season is a classic first-year killer.
19. Do you have any pricing power?
If customers see you as interchangeable with five competitors, you'll compete on price and margins will stay thin forever. Pricing power comes from question 3 — a real difference, a niche, a reputation. A good answer is "customers will pay 10–20% above the cheapest option because of X". If X doesn't exist yet, that's your first job.
20. How will your first 20 customers find you?
"Word of mouth" isn't a plan when nobody knows you exist. Name the channels: a Google Business Profile for local search, a trade association, letterbox drops, your existing network, one social platform done well. Twenty customers, named channels, rough cost per channel — that's a marketing plan.
You
21. What are you good at — and what are you kidding yourself about?
A great tradie isn't automatically good at quoting, chasing invoices or selling. List the jobs the business needs done, mark the ones you're genuinely good at, and decide for each gap: learn it, buy software for it, or pay someone. The gaps you ignore are the ones that sink you.
22. Who is in your corner?
An accountant, a mentor who's run a business, a partner who understands the hours, other owners you can ask dumb questions. Running a business alone with no sounding board is how bad decisions compound. If your list is empty, start building it before you start trading — industry associations and local business groups are the easy first step.
23. How much risk can you actually stomach?
Be honest about the worst realistic case: the savings gone, back to a job in two years, explaining it to your family. If that picture keeps you up at night, start smaller — side business first, day job kept. There's no prize for maximum risk; plenty of great businesses started as weekend operations.
24. What does success look like in 12 months?
Pick numbers: revenue, customers, whether you're paying yourself, hours worked. "Doing okay" can't be measured, so it can't tell you whether to push on, change course or stop. Write the numbers down — they become the first page of your business plan.
25. What is your exit picture?
Even at the start, know roughly how this ends: a business you sell, one that funds your lifestyle until retirement, or a skill-builder for the next thing. The answer changes today's decisions — a business built to sell needs systems and a brand that work without you in the room. No answer is wrong, but "never thought about it" is.
Turning answers into a plan
If you answered all 25, you've already done the thinking most people skip — don't let it evaporate. Our free business plan builder turns exactly these answers into a one-page plan in about ten minutes, and the guide to writing a simple business plan shows what good looks like.
Key takeaways
- Proof beats opinion: real pre-orders, paid tests and named customers matter; compliments and "everyone loves it" don't.
- Know three numbers before you start: cost to first sale, months of personal runway, and monthly break-even including your own wage.
- Registrations are cheaper than you think — an ABN is free — but skipping licences or insurance can end the business in one bad week.
- Competitors are evidence of demand; their bad reviews are your free market research.
- Define success in numbers for the first 12 months, and be honest about your risk tolerance — starting smaller is a strategy, not a failure.
- Write the answers down. A plan you can see beats a plan in your head.
Where to get help
- business.gov.au — free guides, the ABLIS licence search, and links to state-based small business advisory services.
- ato.gov.au — tax registrations, GST and record-keeping requirements.
- asic.gov.au — business name and company registration, current fees.
- accc.gov.au — your obligations under Australian Consumer Law before you start selling.
- Your accountant — an hour before you start costs far less than restructuring after, and they'll pressure-test your answers to the money questions.
General information only. This guide doesn't take your personal or business circumstances into account and isn't financial, legal or tax advice. Rates and thresholds change — confirm current figures with ato.gov.au or your accountant before acting.