Ready, set,wait ……..

This is number four in this series. These three articles precede this one if you want to catch up with how we got this far:

1. Bootstrapping a Registered Training Organisation
2. Bootstrapping an RTO - The budget toolbox
3. Bootstrapping an RTO -The budget toolbox - Part two

We started with a list to map out all the tasks that we thought we would have to do. We ended up with about 130 key tasks for our initial list. We discovered that as we went along some of these tasks were made up of numerous sub tasks. So after the excitement of thinking it would be a good idea to start an RTO came the hard work of putting it all together. 

Here’s a sample of some of the tasks in our list:

1. Business structure
2. Application forms
3. Payment
4. Policies
5. Processes
6. An understanding of the compliance framework
7. Training and Assessment strategies
8. Learning and assessment instruments and everything that goes with these
9. Website
10. Student management system
11. And whatever else we forgot…..

I will not go through the list line by line but will divide it into a number of key categories realising that some of them could overlap:

1. Business structure setup
2. ASQA application details
3. Business infrastructure setup
4. Learning and assessment structure

It’s interesting to realise that even though I wanted to start an RTO that actually doing any training is still a long way away. I originally had compliance in this list but I think I will give it it’s own section later on. 

Business Structure

This article is not meant to give specific advice because everyone’s individual needs will be different but it will describe what we did. There are a number of different business structures that can fit an RTOs needs. The most common ones are:

• Sole trader
• Partnership
• Company
• Trust

We chose to start with a company structure for a number of reasons. This requires a few setup costs that I will outline in the next section. Sole Trader and Partnerships are relatively simple to set up. “A sole trader is an individual running a business. It is the simplest and cheapest business structure”. You can read more about the specifics here: https://www.ato.gov.au/Business/Starting-your-own-business/Before-you-get-started/Choosing-your-business-structure/sole-trader/. A partnership is also a relatively simple structure, to begin with. “A partnership is a group or association of people who carry on a business and distribute income or losses between themselves”. You can read more about it here: https://www.ato.gov.au/Business/Starting-your-own-business/Before-you-get-started/Choosing-your-business-structure/Partnership/.

A company structure best suited our needs and we were able to set up a very simple structure that works well for our situation. You can find some introductory information about a company here: https://www.ato.gov.au/Business/Starting-your-own-business/Before-you-get-started/Choosing-your-business-structure/Company/. What us important to realise even though a company provides some financial protection its directors are still responsible for the actions of the company. There are some very important guidelines to running a company that as a director you must be aware of. Going into this is beyond the scope of this article but it's important to get the right advice when setting up a company. 

Once the company was created then a number of tasks were then able to be tackled. Things like trading names, GST registration, registering domain names were the next jobs to be done. All of this is fairly pain free but needs to be done to make sure you can operate as a business in Australia.

Looking like a business

Some of this part is fun. Choosing colours and business names is about forming the organisation’s identity. It all happens well before a student can even think about enrolling. Some of the things that fit in this section sound mundane but are part of setting the image that you want to have as a business. 

This includes the following:

• Domain names
• Website
• Logo
• Phone number
• Style guides

Registering a domain name is simple enough these days. And, setting up a website sounds like it will be an easy task. These days you don’t exist if you don’t have a website so it's important to get it right. In a previous article, I mentioned how we set up our WordPress site and the theme and plugins used. This is the backend that supports what the prospective student sees when they come to your site. Creating a website was one task we had listed and even though our website is very simple we still have more than 20 pages that require the right content.

An RTOs website is also audited so it’s important to get the details right. Ensuring things like business numbers, RTO numbers, correct qualification codes, use of the nationally recognised training logo are just a few of the things that need to be correct. 

We saved money by using a premium theme and keeping it simple. We didn’t go for an expensive custom design to launch with. We had to face the reality that in a market that has more than 4000 other providers our little enterprise’s website isn’t what’s going to get people to notice us. 

From the outset, we created a style guide for our documents. This might sound a little pedantic but it allows from the outset a consistent look for all our documents. This guide includes things like font and font size, headings, table formatting and colours. Then as we created our documents we made sure that everything was included in our version control register. Again, it might sound a little bit fussy but later on, it makes so many things so much easier if you know where everything is.

Finally, we set up a phone number. This was also pretty painless. We use Skype business calling and forward it to the relevant person’s mobile number. It's fairly cheap, about $25 a quarter for the number and then we spend roughly $10 a month for an unlimited number of calls. This then covers us for the forwarded calls to our mobiles. 

The ASQA application 

These next few phases are overlapping but I will start with the ASQA application. This is where the deep breath needs to be taken. This is where we parted with our biggest outlay to date. There’s an application fee of $500 and an assessment fee of $8000. When paying this fee we realised that we had got to the point of no return. This was it.

This part of the process is fairly straightforward. You just need to pay your money. There are a few things that need to be in place at this point though and are listed on ASQA’s website:

Before applying, you will need to complete several compulsory steps:

• Familiarise yourself with the requirements of the national VET system.
• Demonstrate your organisation's financial viability.
• Complete a self-assessment.
• Fit and proper person declaration

The first one I felt fine with. I was very familiar with the VET system. Between RTOs I did a lot of work with RTOs helping them with compliance and getting through audits. Audits were now a familiar process for me and at this point, there weren’t too many unknowns for me. A really good piece of advice from a successful accountant friend of mine when I was dealing with uncertainty about audits was to know the rules. When you know the rules you know what needs to be done and if it isn’t done then you are aware of it. The Standards for RTOs aren’t that complicated, and if they are followed they are all about quality. Evolation always wanted to be about quality so we don’t see them as obtrusive at all. 

The financial viability is pretty easy. It's the place where you dream about what your business is to become and put some numbers into a budget. Our numbers looked quite good but reality always looks a bit different. It does need to be checked and audited by a qualified accountant. For the other details, you might want to look at this guide that ASQA has published. (https://www.asqa.gov.au/sites/default/files/2020-09/application_guide_-_application_for_initial_registration_0.pdf)

Learning and assessment structure

We started with First Aid, CHCPRT001 Identify and respond to children and young people at risk, and a couple of Business Qualifications including a Graduate Diploma in Management. This last one was a bit ambitious and caused a little bit of anxiety at our initial audit.  

To save money with the business units we wrote our own assessment tasks and used commercial learning materials for our structure. The benefit of writing the assessment tasks from scratch was that it allowed us to really understand the units we were going to assess. 

Even though our scope to start with was limited, it's amazing how much work is required to put together the learning and assessment materials. But, there’s a pretty straightforward list and it's a matter of wading through that list. Again in broad brushstrokes, the following is required:

1. Training and Assessment strategy
2. Trainer’s matrix - we have a process where we identify the trainers and their capability to deliver and assess the units they are assigned to. 
3. Learning materials
4. Assessment instruments
5. Assessor guides
6. Mapping

This quickly adds up to a lot of documents. This is where you start to be thankful for that version control register I mentioned earlier. Then there’s a process of validating everything that’s been created. I wouldn’t like to count the hours spent to do these tasks. But, because we knew what we wanted we were able to do most of it ourselves. 

Ready, Set, Wait…...

So now we have paid our money and at this point in my life, it felt like a fair bit of money. Now the ball was in ASQA’s court.. 

An audit is always about learning and there is always an element of uncertainty before any audit. Although it follows a set process the feeling before is a bit like the anticipation before a test. 

The audit was scheduled quite quickly. We passed the audit with nothing really to change or rectify. We had kept it very simple and limited what we put on scope. Our auditor let us know that she had recommended our application to be approved and then it sat on someone’s desk. We waited and waited. A month went by, we still waited. In the end, it took a few months before the final approval came through. 

That was an exciting day. We now could offer nationally recognised training! Then the question was now what? Who with? I remember in my younger days starting a business washing wheelie bins. I had set up a trailer with water tanks and a gurney and was ready to do business. The first day was a bit underwhelming. I hooked my trailer up and went and washed my wheelie bin and the neighbours bin. Then I turned around and unhooked my trailer. 

This experience taught me that there’s more to running a business than just having the equipment. 

How much are we spending now?

Ok the costs are starting the add up. 

• Setting up the company $506.00 fees
• Business name: $36.00
• ASQA fees: $8500.00
• Phone system: $210 per year including calls
• Admin support: $300.00

Total 

 $9552.00

Then in Part Two, the costs were:

• Sendy $85.00 
• G Suite $180.00 per year
• Add domain and hosting costs: $360.00 a year

Total 

$625.00

In Part One the costs were:

• $189 USD - Learndash with Propanel
• $95 USD - UpdraftPlus but you don’t need the paid version, to begin with.

So roughly $370.00 AUD in total for this section

Altogether the total outlay up to this point for the first year to operate is:

$10 547.00. 

Please note these costs are not an exhaustive list. I am sure there are things I haven't included. But, I hope it gives a bit of an idea of what's required.

This is starting to look like a more substantial commitment. I know that if I wanted to start any other business I would find it very difficult to do for this sort of money. An RTO is a very legitimate business that has the potential to be developed into a viable business. We are still a long way from that mark yet. But, with our initial approval, we are ready to start. 

1. Bootstrapping a Registered Training Organisation
2. Bootstrapping an RTO - The budget toolbox
3. Bootstrapping an RTO -The budget toolbox - Part two

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