Archives September 2020

You wish to sell online in Australia. Here in this guide, you will learn everything from registering a .com.au domain to setting up an ecommerce website to finally receiving payment in your bank in Australia. Along with the costing for each head. There are many options to Australian domain names and we will discuss them, further, in this article. Also, is it better to have a website host based in Australia?

While selling you have to account for taxes, mainly the GST, and a website creator who has hands on experience with taxes in Australia, will be able to give you a better ecommerce website.

We will discuss

• Setting up a business in Australia
• Domain name look up in Australia
• Website hosting in Australia
• Ecommerce website Australia
• Payment gateway in Australia

 

Setting up a business in Australia

At the outset, I must suggest that it is always better to take up all government permissions, registrations, licences and sanctions that a business may require. Take advice of business consultants, check the relevant government websites, ask your friends who are already in business about the ones necessary for your business. Sometimes, if these sanctions are not taken, they pose problems at a later date and prove very expensive, either in terms of money or time or loss of goodwill.

The first and foremost decision that you need to make is about the structure of your business. Your business could be structured as a

• Sole trader
• Partnership, or
• Company

Sole Trader:

A sole trader is the simplest and cheapest business structure to set up. If you’re an individual, planning to run a business singularly,  you can be a sole trader. You will be the sole owner of the business; and the income this business generates, belongs to you.

You have to report the income generated from this business in your individual tax return. Tax on your business income is calculated at your individual income tax rate.

You have complete control over your business, and you are responsible for taking all decisions. Your personal assets are at stake, if things go wrong.

If you hire employees for this business, you will be responsible for giving them their minimum employee entitlements as per the stipulate regulations.

You should apply for Australian Business Number (ABN) (https://abr.gov.au/For-Business,-Super-funds—Charities/Applying-for-an-ABN/). Australian Business Number is free. Only if you have an ABN, you will be eligible to register a business name and register an Australian Domain Name.

Partnership:

A partnership structure is a level in between Sole Trader and a Company. Compared to a Company, it is relatively inexpensive and easy to set up and operate. In a partnership structure, you along with your business partners, own the business, and also share its income and losses. Two or more individuals can form a partnership. If the partners are members of a family, the business structure is said to be a family partnership.

Every business partner’s share is mutually decided among the partners. Each partner is required to report his / her share of the business income on their own individual tax return, and pay tax at their individual income tax rate.

In addition, the partnership business must lodge a partnership income tax return every year with the Australian Taxation Office (ATO). (This means that a partnership needs its own Tax File Number (TFN). You don’t need to register separately for a TFN. The ATO will automatically issue a TFN to a partnership business if it does not have one already.

You should also get your Australian Business Number(https://abr.gov.au/For-Business,-Super-funds—Charities/Applying-for-an-ABN/) (ABN) which makes you eligible to register a business name and register an Australian Domain Name.

All partners share legal responsibility for the business. This means that the personal assets of all partners are at stake, if things go wrong. However, if some partners want to limit their responsibility for business losses, it would be a good idea to consider forming a limited partnership structure. If your business hires employees or staff, all partners shall be responsible for giving the staff their minimum employee benefits and entitlements (such as superannuation and leave).

Company:

A Company structure is more difficult to set up and has higher running costs. I am not trying to frighten you, it is just that you have to comply with reporting and other requirements under Australian Company Law. The Company structure is better suited to medium and large businesses.

A company is a separate legal entity from an individual. This means the company has the same rights as a natural person and can have debt, sue and be sued. A company has its shareholders, who are the owners. The day to day affairs of the Company are managed by its Directors.

The personal assets of Directors and shareholders are separate from the company, so they can’t be used to pay company debts. In certain cases where directors breach their duties, they may be held personally responsible for company losses.

The income and losses that the business makes belongs to the company, and is reported on a company tax return. The company tax rate applies to the business income. Tax File Number (TFN): A company needs its own TFN. The good news is you don’t need to register. The ATO will automatically issue a company with a TFN (if one doesn’t already exist).

If the company employs staff, the company is responsible for giving them their minimum employee entitlements and conditions (such as superannuation and leave). You can find more information on starting a company in Australia at http://www.asic.gov.au/for-business/starting-a-company/how-to-start-a-company/.

Again, You should get your Australian Business Number(https://abr.gov.au/For-Business,-Super-funds—Charities/Applying-for-an-ABN/) (ABN) which makes you eligible to register a business name and register an Australian Domain Name.

Domain name lookup Australia

Most popular Australian Domains are .com.au and .net.au. So, you can register a domain name like mystore.com.au or mystore.net.au if they are available and subject to fulfilment of a few more terms and conditions.

Other than these, the domains .org.au, .asn.au, .auz.info, .auz.net, .id.au, .melbourne can also be registered.

As mentioned above, you need to have a Australian Business Number (ABN) before you can register any of these domains. In addition, you, the registrant, need to be an Australian, as defined under the eligibility and allocation rules.

Domain names are allotted on a ‘first come first served’ basis. So, you cannot reserve a domain name or pre-register it. Further, you have to follow certain guidelines to register domains for domain monetisation. And you cannot register a domain name for an existing brand name or trademark if it does not belong to you. Something which happens commonly with .com domains.

The domain name you are registering should be an exact match, abbreviation or acronym of the registrant’s name or trademark.

You can read the complete allocation rules for domain names here(https://www.auda.org.au/policies/index-of-published-policies/2012/2012-04/).

To renew the domain name, you again have to ensure that most legal compliances are in place.

It is important to mention that you do not get proprietary rights in the domain name system (DNS). You, the registrant, do not “own” a domain name. Instead, you hold a licence to use a domain name, for a specified period of time and under certain terms and conditions.

If you are not an Australian, you can register an auz.net domain without any restrictions. Using an Australian Domain name demonstrates ample proof of your commitment to local customers.

Web Hosting in Australia

Though there are hundreds of parameters on which web hosting services can be rated, we will primarily focus on download speed, cost and availability of CDN . Google does not differentiate a web page based on its country of hosting. What really matters is that the content should be relevant to the search. Some search engines like Yahoo! and Baidu give preference to local content.

ECommerce Website Australia

As a business owner selling online or getting into ECommerce, what matters most is the ease with which the website can be maintained on a day-to-day basis. Once the website is designed, developed and hosted, you will definitely want to add, delete or modify product listings on your own.

Also, you should have a dashboard to view the vital statistics of your ecommerce store. So that when you get an order, it should be listed boldly right there on your dashboard, or if there is a product that needs to be stocked up, you should know it.

Similarly, you should be able to update the prices and stocks with a few clicks, and not have to wait for your web developer to do it for you. You want to put up a Christmas clearance sale, here, do it in a jiffy. You want to write an article or a blog item, here’s the link to go to.

On the shop front, your website should load quickly, both on the desktop as well as the mobile. The website should be responsive, and should render suitably on any handheld device. Your customers or website visitors should be able to access any product with a few (normally three) clicks from the home page. Ideally, a product should be searchable from anywhere on the web site.

The ecommerce website should suggest relevant products to your customers. The customer registration and checkout process should be smooth. Shipping methods employed should be user friendly and the payment gateways should be secure and protected.

Customer should get information about order dispatches and its tracking at every stage of its progress. Moreover, if you are selling globally, your website should be presentable in different languages and currencies.

You get all the above features and many more with an ecommerce website built by us. We have worked extensively with ZenCart, VirtueMart, WooCommerce, OpenCart, OSCommerce and Prestashop. I say this from the developer, customer and website owner point of view.

It is always beneficial to show prices on the website. If, however, for any reason, you do not want to show prices on the website, or you want to show prices after the customer has registered on your portal, or you want to show the retail prices but not the wholesale prices, you can very easily do it from your ecommerce website.

In addition to the above features, your ecommerce website should also be SEO friendly. Your customers can share your webpages on their own social media pages where they are seen by their friends, who can further share these products with their friends. This way, your product pages get viral. In a way, you only have to focus on making your website or web page appealing to others. Social media will take it up from there to get you more and more sales.

So, how much does an eCommerce website cost?

We base the pricing of an ecommerce website based on the features it offers. To give you an example, our standard ecommerce website with these features costs AUD1,750 inclusive of one Payment Gateway and one Shipping Module set up. This fee includes

1. One Domain Name (for first year)
2. Web Hosting for one year on Standard Plan
3. Website Logo Design
4. Layout design of home page, product pages, cart and checkout pages
5. One Payment Gateway Setup
6. One Shipping Method Setup
7. 5 Information pages like About Us, Shipping Policy, Privacy Policy, GDPR, Terms of Use
8. Demo products added to database
9. Setting up taxes for base country
10. Sample “SALE” set up
11. Configuration with bulk mail account
12. Technical support for 3 months

With such a website, you can host unlimited products in unlimited categories. You can display brand names and manufacturers you are associated with (optional).

Renewal costs are approximately 20% of the first year cost if you do not require any modifications. However, if modifications are required, those are priced very moderately.

Payment Gateway

Another area you need to focus on while setting up an Ecommerce website is the choice of a Payment Gateway. While, most Australia based businesses try to get an ANZ Payment Gateway, I must share with you that the process is tedious and it may take up to 3 months to get an approval. At the same time, there are many other Payment Gateway providers in Australia that give an almost instant approval.

Hosted or Integrated Payment Gateway

It is important to understand here that Payment Gateways are of two types – Hosted and Integrated.
Hosted gateways redirect your customers, at the time of payment, from your website to their own secure platform. The customer enters his Credit Card / Debit Card / Bank information on the Payment Gateway’s page. Needless to say, the payment gateway is equipped with the highest level of security settings.

In an Integrated Gateway, your customers will never have to leave your website to type in payment details (Credit Card / Debit Card / Bank Account information) and to place orders. In this case, it becomes absolute necessary that you have an SSL certificate to ensure website security.

In my opinion, hosted payment gateways are better than Integrated gateways, as they offer peace of mind to the website owner. You cannot look after everything.  And since it concerns another person’s credit card or bank details, let the financial institutions best equipped to handle them, do it.

Payment Gateway Fees

While a good Payment Gateway enhances customer confidence, it should not charge you an exorbitant fee for accepting online payments. Another feature you should check before finalising on a Payment Gateway is the fee on disputed transactions.

Some Payment Gateways are all out bent in customer’s favor. They will penalise the Seller with a high chargeback fees in case a customer asks for a refund. You have to decide if you are ready to give refunds, as well as pay a chargeback fee to the Payment gateway Provider or otherwise.

Extra features

Though some features are basic to every ecommerce website, some others are specific to your needs. If you wish to levy a shipping cost based on the buyer’s State or County, you will need to pay about AUD95 extra to include this feature.

Similarly, if you sell locally and home-deliver the goods, you may need to charge a delivery fee beyond a certain distance. You can have a module which calculates the distance (or time) from your warehouse to the place of delivery.  You can charge a per kilometre fee. This fee will be calculated automatically when the buyer enters his delivery address. This additional feature too will cost you about AUD95.