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1. Do I need to prepare a business plan?

Many people site if you fail to plan, you plan to fail, the business plan is viewed by many as the best tool for ensuing a successful entry into the world of business. A business plan should cover the following topics:

Introduction
Executive Summary
Industry Analysis Overview of the Industry
The Business
Product Range/Service
Manufacturing/Production
Marketing
Financial Information
Management and Staffing Strategy
Supporting Documents and Miscellaneous

2. What are some of the reasons so many small businesses fail in their first year?

Some of the causes of business failure stem from:

The lack of research undertaken before going into business, this is why I wrote Show Mummy the Money
The lack of knowledge, skills, managerial experience, technical proficiency
The lack of cash flow

3. Is it necessary to do a feasibility study before going into business?

I believe it is far more valuable to perform a feasibility analysis on the potential of your idea for a business, than it is to prepare a business plan. A feasibility analysis will determine the likelihood of success, how easy or hard it will be to achieve success, whereas a business plan is about where you expect to go in the future, not a determination on the probability of getting there.

A feasibility study should look at such factors as:

The industry you intend to compete within, who your competitors are, industry trends.
Your target market, who are they? Demographics, information about your customers.
The costs involved both start-up costs and operating costs i.e. Operational, marketing set up costs.
The type of skills required to facilitate the business.

4. Are you "Business Ready" consider our checklist

Initial Stage

Conduct a thorough feasibility study on your business proposal and or prepare a business plan.
Check what licenses/registrations may be required through Business Licence Information Service.
Check with local council on any applicable zoning issues and or health regulations.
If buying an existing business, obtain 3 years trading figures (profit and loss statements etc), history of the business and its owners, break up of purchase price (land, buildings, equipment, stock at value, intangible assets including goodwill, databases, patents etc) and determine real reason for sale.
Choose a qualified accountant and discuss your proposal.
Determine legal structure for operation (company/partnership/sole trader).
Check tax obligations.
Determine training needs for yourself and where applicable staff.

Developmental /Establishment Phase

Register your selected business name Set up business bank account (Certificate of Registration of Business Name will be required for the establishment of a bank account in business name).
Apply for your Australian Business Number and register for all relevant tax obligations eg GST, BAS.
If you intend to employ staff, register as a group employer through the ATO.
If you intend to employ staff you will need to understand relevant working awards, you will need to establish superannuation policies and take out Workers Compensation cover.
Organise business insurance: Insurance cover for such events as: public liability, vehicles, fire, burglary, plate glass, professional indemnity.
Look into protecting your Intellectual Property through, Trade Marks Registration, Patents, Copyright and Designs, etc.
Consider Credit Card arrangements such as EFTPOS, Credit and debit card facilities.
If property leases are involved, be sure to consult with a solicitor, before signing.
Purchase business equipment i.e. computer, cash register, fax machine, mobile phone, photocopier …
Contact suppliers, order stock and determine terms.
Implement marketing strategy, in particular promotional strategy.
Organise business stationery, including tax invoices, letterheads, business cards, brochures, cash journals, quote book and order book.
Set up a suitable accounting and filing system you are required to maintain records for up to five years.
Join any applicable trade associations and organizations.