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When you start a business, there are a range of ideas that may come to mind. A common type of business we come across is a self defense business.
It’s an extremely helpful skill to teach people in this day and age, and the business expansion opportunities that come with it are great, too!
However, before you dive into any business venture, it’s important to think about your legals. For example, which business structure is best for a self defense business? How do I register a self defense business? What kind of risks do I need to mitigate?
In this article, we’ll talk about how you can start a self defense business and the best (and safest!) way to go about it.
Which Business Structure Do I Choose For A Self Defense Business?
Like any other type of business, the first thing you should think about before you set up a self defense business is which business structure is best for you.
There are a few different types of business structures, namely:
- Sole trader
- Partnership
- Company
When choosing a business structure, you need to think about how much your business will be, and whether you want to stay local or expand internationally. You also want to think about the nature of your business activities, and the level of risk involved in your transactions.
A self defense business carries considerably high levels for risk, particularly with respect to injuries. As such, you may want to consider a business structure that limits any of your personal liability (this is where a company structure would prove to be more suitable).
However, a self defense business is the type of business that does well in a local area, where family and friends offer recommendations for good places to each other (like a gym!).
As such, you may opt for a structure that requires less financial resources to set up – this is where you’d lean more towards a sole trader or partnership structure.
It all really depends on the vision you have for your business and how you see it moving forward.
Register My Self Defense Business In Australia
Your next step is to make things official – this is where you’d Register Your Business.
When you register your self defense business, you are legally entering your company into the national database. This is for the purpose of collecting tax and other relevant fees.
When you register your business, you’ll also get an Australian Business Number (ABN) (if you are a sole trader or partnership) or an Australian Company Number (ACN) (if you are a company).
If you’re operating under your own name, you won’t need to register a business name. However, if you do Register A Business Name, it’s worth noting that this does not automatically prevent others from using it.
To protect your business name, you may want to register it as a trade mark.
What Legal Documents Do I Need For A Self Defense Business?
Starting a self defense business is a big step, but a good one. However, it also comes with several risks.
Consider the following:
- What happens if someone gets injured?
- Who is liable for damage to property?
- Who is liable for customer injuries?
- What if equipment is faulty?
- What if customers default on their payments?
A number of things can go wrong, which can negatively impact your business activities and overall performance.
To mitigate these risks, your safest best is to have the right legal documents in place.
Business Plan
While not necessarily a legally enforceable document, a Business Plan is an essential element of any business venture.
It’s best to view it as the blueprint of your entire business and its goals. It should set out what you hope to achieve, how you can achieve it, the resources you need to do so and relevant deadlines to keep yourself on track.
If you need to disclose your Business Plan to anyone, it’s important to have a Business Plan Non-Disclosure Agreement so that the inside information of your business’ future and your strategies do not end up in the wrong hands.
Does My Self Defense Business Need Terms And Conditions?
Most businesses have standard Terms and Conditions no matter what type of goods or services they provide. These are quite common because they set out terms that users or customers must agree to before they can properly engage with your business.
This is a good way to regulate how people interact with your business, which also limits the risk of things going wrong. Keeping this kind of conduct within your control is always a safe bet.
These terms need to be drafted specifically for your business’ needs. Since every business is different, it’s worth getting a legal professional to help you out with this.
A self defense business is similar in nature to a gym, so you may want to check out our article on Gym Terms and Conditions to get an idea of what good terms might look like.
Having good terms and conditions is particularly important if you wish to have an online presence, as the list of legal risks expands when we’re talking about the online space. If you need eCommerce Terms and Conditions, feel free to reach out to our team.
Service Agreement
Since you’re providing a service for people to learn self defense, you’ll need to have a good Service Agreement in place.
A standard Service Agreement will cover:
- The scope of services
- Duration of the agreement
- Payment
- Warranties
- Customer’s obligations
- Intellectual property rights
- Liability
- Dispute resolution
- Termination
Put simply, a Service Agreement will cover the terms around how you provide the service to customers and what will happen if people do not comply with those terms.
How Do I Limit Liability For Injury In A Self Defense Business?
Like we mentioned before, self defense businesses carry a relatively high level of risk when it comes to potential injuries.
Since customers will be performing some strenuous activities or harmful actions, it’s important that your business is well prepared in case an injury raises the issue of liability on your end.
This is where you may decide to insert limitation of liability clauses in your contracts. This clause limits your liability in relation to any injuries that result from your business activities, such as the use of equipment.
Do I Need Insurance For A Self Defense Business?
Another way you can mitigate risks (apart from strong contracts, of course) is by having insurance in place .
Under Australian law, all businesses need to have workers’ compensation insurance. This is to protect employees if they get injured at work, so they can be appropriately compensated.
While other types of insurance are not required by law, a self defense business will benefit from having these in place due to the risk of injury. So, you may want to get public liability insurance which covers you for death or injury.
Can I Franchise My Self Defense Business?
Franchising is a great way to expand your business, either in Australia or internationally.
It can help you reach a larger customer base and have a stronger presence in the market.
It also provides a good opportunity for other people to become business owners. If you want to start a franchise, it also removes that additional stress of managing multiple chains because that effort is distributed among different franchisees.
However, franchising is a heavily regulated area of business in Australia. In addition to your Franchise Agreement, you need to comply with the Franchising Code of Conduct.
The Code sets out obligations when it comes to franchising, such as disclosure documents and fees to pay when a franchise is first sold to a buyer.
Your Franchise Agreement should set out details around franchise fees, royalties (if applicable), who owns IP, confidentiality around trade secrets and managing marketing funds.
It can be a complex area if you’re navigating it all for the first time, so it’s encouraged that you seek the help of an experienced franchise lawyer – Sprintlaw has a few that are ready to help!
Key Takeaways
Starting a self defense business is a great step, but it also means you need to think about how you can limit liability and mitigate all relevant risks.
To protect your business and ensure you can have a smooth start, it’s best to seek legal help for drafting strong contracts. Our lawyers are happy to chat you through your options and find what’s best for you!
If you would like a consultation on your options going forward, you can reach us at 1800 730 617 or team@sprintlaw.com.au for a free, no-obligations chat.
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