Three Things to Consider Before Opening an Office Interstate

So business is booming, and the idea of opening an additional interstate office is an appealing one.

Or maybe business has slumped, and the trading landscape looks greener in some of Australia’s other states.

Opening extra offices in other Australian states, however, can also open up a real can of commercial worms for your business if you haven’t prepared properly.

Here are three things you’ll need to think about before taking the step, including business registrations, the market for your product or service, and how to overcome the host of communication challenges that can occur when you have employees in different cities.

Check registrations and licences

Whatever you do, don’t neglect your legal homework. A business can come tumbling down if it’s built on faulty foundations which flout the requirements of the state in which it’s based.

  • If a registrable Australian body wants to carry on business in one or more states or territories other than its home jurisdiction, it must be registered under Part 5B.2 of the Corporations Act 2001.
  • Read the Australian Securities and Investments Commission (ASIC) guidelines thoroughly before setting up an additional office, and seek additional advice if any instructions are unclear.
  • Australia can be a minefield when it comes to figuring out different state requirements, so start with the business and industry portal of the state government in question. Each state will provide detailed information about establishing a business there, due diligence, and meeting legal obligations. In Victoria, for example, the portal is business.vic.gov.au.

Assess the competition

Your product or service may enjoy a secure niche in your home market, but are you sure demand exists in your planned new state?

Jason Daniels of accounting firm PricewaterhouseCoopers suggests carrying out a full business analysis of your existing business before taking the risky step of opening another store or office interstate.

Using a successful Brisbane client as a case study, he points to the importance of his client having a thorough checklist before opening a new store in Sydney.

"The beauty of this client is that he understands why his business works . . . and the thinking behind his checklist,” he said.

“Does the store and location tick all the boxes? Look at demographic information. Where are your potential customers likely to come from? Other practical factors include the visibility of the store from the road and the style and size of the store and the types of stores nearby.”

Carrying out due diligence on your selected area is a must. Check established brands, popular trends and planning developments closely. Do you really want to create a new shop only to find that a SuperDuperMegaStore is opening next door in six months’ time, selling exactly the same thing only cheaper?

Upgrade communications

How will your employees and colleagues collaborate if you have two or more workplaces based in different states?

You need some strategies and technologies in place to streamline your entire communications system.

If you’re not working in the cloud already, now’s a perfect time to spread your wings.

  • Cloud-based technology allows workers to access and share information wherever they happen to be in the country. With the ability to exchange files and documents and collaborate on documents in the cloud, employees are no longer tied to one workplace, making your offices (however many there are) truly virtual.
  • Workers with good smartphones or tablets can multi-task and multi-function in taxis, restaurants, trains, hotel rooms and airports – wherever they happen to be.
  • Discover the beauty of online faxing. There’s no need to set up your new office with outdated fax machines. Smartphones can now be used to send and receive faxes, with unlimited storage in the cloud for sent items. Fax to email is the new kid in town, and it’s hard to go past it for ease and convenience.

Don’t be put off if you’re set on interstate expansion. Just familiarise yourself with the pitfalls before you embark on such a significant journey.