Young Australians are taking their future into their own hands, with nearly half (47%) of secondary school students wanting to start their own business when they leave school, according to the latest report from the NAB Economics’ Education Insights Series.

NAB Head of Economics Dean Pearson said younger Australians have a sense of optimism about the future and an innate entrepreneurial spirit.

“All too often, young people are portrayed as having a sense of hopelessness in the face of constant change – this is a far too negative a perception. What emerges is an enthusiastic and civic-minded generation, with a strong sense of self-belief,” Mr Pearson said.

“They’re focused on life after school and the contribution they can make to society. And importantly, they’re confident they will achieve their goals.”

Mr Pearson said being a small business owner aligns with many factors young Australians want out of life.

“Owning a business can offer significant control over various aspects of life, including financial security, work-life balance, and decision-making,” Mr Pearson said.

Strong digital literacy due to growing up surrounded by technology is another key factor that positions young people well to start their own business, Mr Pearson said.

“Young people have a much greater capacity to accept change, which of course in the current economic environment and the influence of AI, means adaptability, innovation, and the desire to constantly learn, are set to become even more crucial for businesses.”

NAB Small Business Banker Kyle Britto shares his perspective on how young Australian’s can successfully launch their own business.

“Starting your own business requires hard work, resilience and optimism – something Australia’s youth clearly possess,” Mr Britto said.

“It’s important young people know their advantage over their competitors, and price themselves according to these advantages. Know your worth and don’t discount yourself because you’re young.”

Mr Britto shares his top tips on what young entrepreneurs can consider when starting their own business based on his experience working with small business owners.

1. Calculate your start-up costs

Coming up with an idea for a new business is a great moment. The next step is to work out its financial feasibility. The NAB start-up costs calculator can help you estimate expenses and potential profitability.

Mr Britto said when starting your own business it is important to keep overhead costs low.

“When starting out it’s important to figure out what you need as a minimum to sell your product at a quality you’re content with and bootstrap your operations,” he said.

“Keep your costs as lean as you possibly can. Keeping your overheads low and keeping your business cost-efficient is a good skill to have at any stage of business.”

2. Find out what being your own boss really means

The reality is that running your own business requires a lot of hard work. Typically, more work than a standard 9 to 5 job. It might be a number of years before small businesses start to make a reasonable profit.

A good way to explore whether this is something for you to pursue is to sit down with your family, friends or someone you trust and discuss what starting your own business will entail.  This checklist looks at the essential attributes that are needed to become a successful business owner and to help you assess whether you’re ready to take on the challenge of running your own business.

3. Choose your business structure

Once you’ve established the financial feasibility of your business idea, you can select the business structure that is most relevant to the needs of your business.

Mr Britto said choosing the right business structure is critical.

“It’s important to make sure you set your business structure correctly from the start, as changing structures can be difficult if the business grows too much. If you’re not sure, seek advice from an accountant,” he said.

Different business structures include:

• Sole trader – select this option if you’re an individual operating as the sole person legally responsible for all aspects of the business. Like other structures, as a sole trader you can employ people to help you run the business.
• Company – a separate legal entity from its (owners (i.e. shareholders). If you’re eager to register as a company, you can explore your options for an Australian Company Number (ACN) online.
• Partnership – an arrangement where two or more people, or entities, run a business together, but not as a company.
• Trust – this is a structure where a trustee carries out the business on behalf of the trust’s members (i.e. its beneficiaries). A trustee can be a person or a company, and is responsible for the business’ operations , including income and losses.

4. Get an ABN

The next step is to set up an Australian Business Number. This is what identifies your business.

Once you’ve got an ABN, you can then register for business taxes.

It’s important to gain an understanding of Australian tax requirements.

Australian business owners are required to register for an Australian Business Number (ABN) and Goods and Services Tax (GST) if their annual turnover is $75,000 or more. Other thresholds may apply, for full details and to register, visit the Australian Tax Office (ATO) website.

You may also need to register for other taxes such as Pay As You Go (PAYG) withholding,  and Fringe Benefits Tax (FBT).  It’s always a good idea to check with the ATO or a tax professional to ensure you’re meeting your obligations.

5. Register your business name

This is the name under which your business operates. Once you’ve decided on the name, you can register it with ASIC, but make sure it hasn’t already been registered.

Importantly, registering your business name will help protect your business if you choose to use that name as a trademark.

6. Develop and write an effective business plan

A well-crafted business plan can help you set clear business objectives and stay focused on the goals of your business. Writing your business plan can also help you consider each aspect of your business and identify any potential challenges or risks that may be associated with getting started.
Mr Britto said that above all, starting your own business is a wonderful opportunity to build skills and make a positive impact.

“Don’t be afraid to fail, and if you do, pick yourself back up, apply those learnings and try again. Keep going – the success is going to be there, it’s all about learning and adapting.”

This article contains general information only and does not take into account your objectives, financial situation or needs. The views expressed by NAB representatives are their own and do not constitute any recommendation or advice. Before you make any decisions, consider seeking advice from a qualified professional.