4: Legal and Physical Resources

Legal aspects

Legal status

The legal status for my hairdressing business is a sole trader. I have chosen this status because it will enable me to make my own decision and be an independent person when running my business.

Legal liability

My business will be having a unlimited liability. This is because I am a sole trader; therefore I need to be careful that I don’t go into debt. Unlimited liability means that if a business goes in bankruptcy than the owners personal goods are taken away in order to pay the debt off. This means that if my business goes into bankruptcy, my personal belongings will be taken away such as TV, house and car.

Terms and conditions

For my business there aren’t really any terms and conditions, except when a consumer gets his haircut he is cutting on his own risk. Terms and conditions needs to be considered by me clearly when buying goods for my business. This is important because sometimes suppliers don’t take back goods after purchased.

Trading standards

It is important that when I buy goods from suppliers that the products bought do meet legal safety requirements. This is because I will be using these products on someone else. Therefore, it’s important that they meet requirements; otherwise I can be punished by the law.

License

To run a hair salon a license is required; this is because of safety reasons. Therefore, a license is a critical tool to have.

Record Keeping

I will be recording my income and outcome through the use of a cashbook and a sales ledger. It is important that these are kept, which will help me to monitor my performance and for legal aspects. However, the main recording keeping will be done by my accountant which will give me a better overview of money going in and out.

Resolving problems

There will be sufficient standards of communication between me and my staff. This is because it will provide effective business results and a safe working environment. A grievance procedure will be applied into my business. This is because my workers should have also equal opportunities if any unfair treatment has taken place. Furthermore, frequent meetings will be held in order to resolve any issues or improve staff dissatisfaction. There will also be disciplinary procedures which will make staff aware that inappropriate actions are not acceptable. E.g. Low punctuality or attendance to work.

National and local law

Insurance is a vital tool to have in the business. It supports the business and can safe the business from going in debt. E.g. If my premises gets burnt down or a consumer gets injured. There are various types of insurances required and the one needed for my business are:

1. Employers liability insurance- If a employee gets injured then this protects me from any legal damages.

2. Buildings insurance- If my premises gets damaged then the insurance will reconstruct it for me.

3. Contents insurance- Any tools are equipment gets stolen than insurance covers that.

4. Owners liability insurance- If a consumer enters my premises and gets injured than my insurance will cover me for that.

5. Public liability insurance- If a member of my staff injures a consumer than my insurance will help me to cover the damages.

Contract of employment

I will need to sign a contract with my employees. A contract is a legal agreement between two parties and is very vital. This is because it mainly covers rights and responsibilities of an employee. I will also need to register for VAT because I earn £140000 a year. The rule is if you earn more than £61000 than VAT needs to be paid.

Health and Safety
All businesses are responsible for employees and consumers who visit my shop. The management of health and safety at work regulations require employers to take on a risk assessment checks about how to make their premises safe. After this procedure the shop should have a written health and safety policy, for consumers and other people to see.

Regulations

There are certain regulations organisations need to consider which are:

1. COSH- The Control of Substances Hazardous to Health regulations set rules about how to handle chemicals and other substances. The owner needs to monitor this frequently and needs to inform employees about this as well.

2. Fire regulations- Fire risk assessment should be done regularly to be fully confident under a hazard. Fire routes and equipment should be obtained for safety reasons. Moreover, this will make staff aware about the whole procedure.

3. Planning permission and building regulations- Firms wanting to extend their premises or change the use of the building need to seek permission from the local authority.

Regulations body

In the UK the government has set up standards an organisation needs to meet in order to be environmental friendly etc. These are the standards they need to meet:

• OFT- Office of Fair Trading- Monitors business activity and protects them from unfair trade or treatment.

Source of advice

When a business is not going well external support can be helpful in order to do better. Therefore it is vital to create good network with people through organisations such British Chamber of Commerce. DTI (Department for trade and industry) is an organisation whom helps businesses in several ways such as advice and other support. Local enterprise agency is an organisation who are contracted through Business Link. They provide training and consultancy services to local businesses as well as start up assistance.

Physical aspects

My barber shop is located on the Hayes Broadway. In my premises I’m renting I got a toilet and a small kitchen. I have just got one toilet; therefore staff and consumers need to share toilets. Currently, I have got to chairs and three sinks. I was thinking about another chair, but I will wait and see how sale goes. I have got radiators in order to dry the towels I use for my services. I have also got a little table for my daily newspapers and magazines. In order to carry out my services I will need machines and scissors. I will be having approximately 6 machines and 10 scissors, as there are different ones for different services. Underneath I have produced a little plan of my shop. As I have got some much space I might half it and rent it out in the future. It depends on my business performance; this area could be used for more chairs. The area which is called “another service” I am thinking of making that for women. This is because some women can’t carry out services in front of men due to religious purposes. However, I will do this after sometime, when I know that I will get female consumers. There is no point getting it done and then its not in use.