Establishing a fashion business can be electrifying and a roller-coaster journey. To avoid pitfalls, read on…
Think of an amazing brand name, and protect it!
A catchy brand name can make all the difference, as it’s the basis on which your business will be established and will flourish. It’s therefore crucial to first ensure your name is unique, and avoids confusion with other names already out there. Once you’re clear on this, get the brand name and any logo associated with it registered as trade marks. This will allow you to protect your brand from copycats, and safeguard the value of the goodwill you generate.
What legal structure is most suitable for you?
Three most common business structures are below:
• Sole Trader: you run your business as an individual, retain all profits post tax and can employ staff. You are accountable for the business and personally responsible for any losses your business makes. For tax purposes, you are considered self-employed.
• Partnership: responsibility is shared between you and your business partner (or partners). The profits of the business can be shared between all partners in the business. Each partner pays tax on their share of the profits.
• Limited Liability Companies: a company is a separate legal entity owned by shareholders. The company is responsible in its own right for everything it does and its finances are completely separate from your personal finances. Any profit made by the company, after payment of corporation tax, can be distributed between the shareholders.
Have you thought about your location?
Some of the most famous start-ups have begun in a back bedroom, but as you expand you might need to relocate to an office or shop space. Space is often bought via leasehold, but don’t be too eager to sign without ensuring you fully understand and agree to the terms. A more cost effective strategy might be to trade over the web. If doing so, it’s a great idea to get expert advice on trading over the internet as there’s a whole host of complex laws and regulations surrounding this.
Do you have the right agreements in place?
Before entering into a business relationship, you should ensure that you have all of the appropriate agreements in place. For instance, if negotiating with a third party – such as a supplier or developer – you should have signed a non-disclosure agreement to protect any confidential information you may exchange. Having the right contracts set out from the beginning is essential, particularly to avoid complexities in the event of a dispute!
For more information on setting up your business don’t hesitate to contact me.