The number of start-up businesses has been on the rise for years, but there has been a boom in the last few years in particular. Many people are tired of their working conditions and the attitude of employers during the pandemic, so they want to escape into a better life; others are simply trying to develop a side income to keep up with the rising costs of staying alive. However, it is not always as straightforward as others make out, and important details can be forgotten. So, below are a few points that it is important to remember when setting up your business.
The biggest one is permission. Even if you have bought your own home, you will need to investigate carefully whether you are allowed to carry out your business. This permission will apply to all aspects of your property, so don’t think you can get around this by using a shed or a garage instead of your main building. You will need to go back to the deeds of your property and make sure that there aren’t any clauses which prevent you from setting up a business. You may also need to check with your mortgage holder as some mortgage terms may not allow it – this might simply mean changing your mortgage, but it is worth checking. If you rent, you will need to get the permission of the property owner and examine your tenancy agreement. Even if you get permission from the owner, you may need a new tenancy agreement in place.
You probably have standard home insurance to protect your property – but this is unlikely to cover you if any damage occurs while you are running a business. Instead, you will need to take out insurance which is relevant to your business – the type you need may be very unique, and you may need various different policies to cover everything.
It is highly likely that you will need commercial liability insurance for your business, for example. This will protect you against any damage or injuries that might occur as you go about your business – if someone visits your property to collect a cake, trips and breaks their arm, for instance. If you expand your business and hire employees, you will probably need employer’s liability insurance. You should talk to a professional to make sure that you are fully covered at every stage.
You will need a General Business License before you can operate, which is almost guaranteed, and there may be some local or neighborhood restrictions on these. You should talk to your local city or county to see what licenses you need in place for your business to be legal. Your particular business may also need a professional license; this will depend on the type of work you are doing. You will probably also need certain permits or certification to operate legally – such as a health and safety permit or a food hygiene certificate.
When creating a new small business, it is perhaps obvious why many choose to use their homes as a base. There is the comfort of familiarity when starting a new venture, as well as reducing the level of commitment needed. However, it is still a business which needs to meet certain legal guidelines, and these can easily be overlooked – particularly if you don’t start out with the intention of creating a business and simply do a few favors for friends which escalates into larger production.