You are passionate, creative and have something that you want to share with the world. Your neighbours and friends have been urging you to sell you products – but how do you go about starting your own business?
It can be a tricky field to negotiate the forms, online fields, websites and tick boxes required to legally take your product to market.
STEP 1: Choose your structure
Firstly, consider whether you wish to set up as a sole trader or a company. A sole trader means that you will be the ‘legal entity’ responsible for the buying and selling of merchandise, payment of taxes and any liability that may arise from your business activities. Setting up as a company means that the company will be the entity purchasing your supplies, selling your merchandise, paying the taxes (at company rate) and then hopefully distributing an income. The structure you choose will depend on the income that you may generate as well as any potential product liability.
If you are registering as a company you will need to contact the Australian Securities and Investments Commission (http://asic.gov.au/) (ASIC) to register your company. We can also set up a company for you and can take care of all of the forms, regulatory obligations and provide you with a comprehensive company register.
You will also need to consider whether an ABN is required for your company or for you as a sole trader. A quick chat to your accountant will determine whether one is required, they can be obtained from ato.vic.gov.au online if you do need to obtain one.
STEP 2: Consider your business name – and the IP issues that come with it!
The second step is to consider your business name. If you have a company, you can register the company’s name as your business name (provided it’s not already being used). If you are operating as a sole trader and are trading under a name other than your own personal name then you will need to register a business name.
In selecting your business or company name you should undertake some searches to consider whether anyone else is using that name and if so, are they using that name for the same or similar goods and services as you. Some general internet searches can assist as well as a search on the ASIC database. We can also provide you with a fixed quote to undertake the searches on your behalf. If you intend to use the name as a brand rather than just your trading name, you may need to consider whether you would like to register the brand as a trade mark. We can clarify this for you in a brief discussion.
STEP 3: Get insurance
The next step is to consider whether you need product or public liability insurance. The questions you should ask yourself are: can my products cause injury to any person or property (for example food is a good example of a high liability product)? Will any customers be coming onto my premises? It can be cost effective to find an insurance broker who deals with the types of products that you sell, they can often shop around for you and find a competitive insurance rate related to the volume of product you think you may sell.
Gladwin Legal specialises in assisting you to achieve your dreams. We are flexible and modern and provide affordable legal services to a wide range of clients in the retail and consumer goods sectors. If you have any questions or require any assistance with starting up your business, please contact us at or 0433 114 748.