Two sisters from Wales have recently featured in the news due to the success of their makeup brush brand made famous through the social media platform of instagram. The sisters started out in their garage in Barry and now have a business worth £8 million pounds with new offices, employees and a deal to feature their makeup brushes in the next series of a popular British TV show.
Whilst it is not easy to start up a new business, start-ups are instrumental to the UK’s business landscape especially if these start-up businesses have the capacity to scale up (a recent topic featured in Jane’s blog.)
Here are some considerations for those entrepreneurs thinking of starting up:
1. How will your business operate?
The most common forms of trading structures are:
- sole trader- suitable if you are going into business on your own
- partnership- fitting for a number of individuals who will be each equal within the business
- limited company- creates a separate legal entity, the company will own and run the business
2. How will you fund your business?
Every business needs money:
- initial investment – bank borrowing, angel investors etc
- capital raising – allotment of shares
- cash flow – contractual payment terms
- credit and debt management
- tax returns and relief
3. Whose terms will apply?
A business will want to trade on its own terms and conditions but a business will also be subject to other terms and conditions. A business will usually enter into contracts relating to staff, premises and equipment, which are needed to run the business effectively:
- Sale of Goods Act 1979/Supply of Goods and Services Act 1982
- Consumer Rights Act 2015
- Licences to operate
- Recruiting employees – the statutory responsibilities and duties of the employer
- Property leases
- Equipment hire agreements
- Insurance policies
4. How will you market and promote your business?
A good product or service alone is not enough for the business to succeed:
- Intellectual Property Rights – creation and protection of brand names, logos, designs and products
- Website- Terms & Conditions of use, Cookies and Data Protection policies
- Use of Social Media and related policies.
If you would like to discuss starting up a business please contact a member of the Corporate and Commercial team.
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