Operating a business can be extremely rewarding, but it can also be risky. One of the fundamental aspects of owning a business is ensuring your personal assets are protected from misfortune. Minimising exposure to risk means paying attention to business structure.
Some businesses operate in a high-risk industries like asbestos removal. Others operate in a high-risk environment, such as restaurants and food preparation businesses. And, many external factors can expose a business to risk, such as when a customer goes bankrupt. These situations can put a great deal of pressure on your business. Some businesses are sued, and some go broke as a result of exposure to risk.
Containing the damage to only one part of your life is a fundamental aspect of operating a business. Having the right business structure (and good insurance) in place means your personal assets are more protected than if you were operating as a sole trader. There are a few key business structures that are used in Australia, and each has their pros and cons. Talking to your accountant or business advisor will help you, as a business owner, to understand what the best structure is for your situation.
BJT Business Advisors can support you to get your structure right, to minimise the potential impact of the risks.