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Pottery offers unique, handmade goods in a market often saturated with mass-produced items. It’s no surprise that consumers are drawn to beautiful, handcrafted pieces and are willing to pay for them. If you have a talent for pottery and are eager to share your creations with the world, starting a pottery business could be the perfect fit for you.
To ensure your business thrives well into the future, it’s crucial to set it up correctly from day one — that’s where we come in. Keep reading to find out how to build a strong foundation for your pottery business.
How Much Does It Cost To Start A Pottery Business?
Starting your own pottery business requires materials and a functional workspace, at the very least. You’ll also need to consider factors such as postage and handling, storage, marketing, a business website, registration costs, and more. To estimate the costs of starting a pottery business, it’s best to create a business plan.
A business plan includes essential details like market research, financial considerations, competitor analysis, as well as your own ideas and vision for the pottery business. Having all of this information in one place can help you determine exactly what you need to get started, preparing you for the journey ahead
If you’d like some tips on creating a business plan, check out our article, How To Start Writing A Business Plan.
How To Start A Pottery Business In Australia
The first step to officially launching your pottery business is registering it as a legally recognised entity. To do this, you’ll need to decide on the legal structure your business will operate under. The structure you choose will impact your business operations, legal obligations, and limitations—so it’s important to choose carefully to avoid the need for restructuring later.
In Australia, the three most commonly registered business structures are a sole trader, partnership and company. Let’s take a closer look at them.
Sole Trader
A sole trader structure is often chosen by business owners because it’s easy to set up. To start your pottery business as a sole trader, you simply need to apply for an Australian Business Number (ABN). Obtaining an ABN is straightforward and free—you can complete an online application, and once approved, you’ll receive your ABN. The next step is to register a business name; however, this only applies if you don’t plan to use your full name for the business.
One drawback to setting up your pottery business as a sole trader is the lack of legal separation between you and your business. As a sole trader, your business is legally attached to you, meaning any financial or legal troubles faced by the business will affect you personally, putting your personal assets at risk.
Partnership
A partnership business is also relatively simple to set up. You just need to obtain an ABN and register a business name—unless the business name will use the full names of all the partners’. However, a partnership is not a separate legal entity, which means it is legally attached to each partner. This can be challenging, as you cannot control the actions of another partner, yet you may still be liable if one partner makes a mistake.
It’s crucial to enter a partnership with clear expectations by establishing a Partnership Agreement and setting solid ground rules. Alternatively, you may consider setting up a company structure, with all partners acting as shareholders (see below).
Company
A company structure provides the most legal protection, as it is an independent legal entity. Rather than being the direct owner, you can simply be a shareholder. The company has its own legal identity, allowing it to own property, earn profits, and even incur debt. This legal separation gives you limited liability, meaning you’re only responsible for what you have invested in the company. However, limited liability has its exceptions—such as in cases of misconduct or illegal actions—so it’s essential to understand the limitations of this protection when starting a company.
If you want to register your pottery business as a company, it’s wise to seek expert legal assistance. Although a company offers strong legal protection, the setup process can be complex. You’ll need to decide on elements like the company type, governance structure, directors, and shareholder details. Additionally, companies are closely regulated by the Australian Securities and Investments Commission (ASIC), so it’s crucial to understand and comply with these obligations—a legal expert can guide you through this process effectively.
Key Legal Documents To Start A Pottery Business
Once you have registered your pottery business, the next key step to successfully setting up your business is protecting it with the right legal documents. Without strong legal documents, you leave your pottery business exposed to unnecessary risk – many of which can cause detrimental trouble for your business down the line. That’s why, sorting out legal agreements right from the start can save you from issues later on.
Here’s a few legal agreements you might want to consider:
Legal agreements only work well if they are professionally drafted and tailored to meet the needs of your business – be sure to chat with a legal expert about getting these documents for your pottery business.
Laws And Regulations: Which Ones Apply To My Pottery Business?
If you want a pottery business that doesn’t get legal penalties, avoids fines and has good standing in the community, then you will need to follow various regulations. As laws set the standard for business operations, it’s important to be aware of the rules that impact your business and ensure you’re always in compliance.
We’ve listed a few regulations you may want to consider when starting your photography business.
Data And Privacy Law
If your pottery business has a website, conducts workplace surveillance, or collects customer information, it’s essential that all your practices comply with data and privacy regulations. These regulations set the boundaries for surveillance, the types of information that can be collected, how it should be handled, and the notifications you must provide to individuals.
For example, if your business website collects phone numbers or other personal details from users, you will need to have a Privacy Policy in place. Additionally, it’s a good idea to implement Website Terms and Conditions to outline the scope of your services, payment policies, and any relevant limitations or disclaimers.
Australian Consumer Law
As a business owner, keeping your customers happy is essential if you want them to come back, rate your services well and avoid disputes. The Australian Consumer Law (ACL) determines what right consumers have when engaging with a business. Compliance with the ACL will not only ensure your customers are being treated daily and in accordance with the law, it can help protect your business against complaints.
Matters covered by the ACL include:
- Consumer guarantees
- Advertising
- pricing
- Misleading and deceptive conduct
- Warranties
- Payment methods
- Receipts and bills
There’s a lot of elements to the ACL – if you’re feeling overwhelmed, feel free to reach out to a legal expert for further guidance.
Employment Law
When you decide to hire employees for your pottery business, it’s essential to update your business practices to comply with Australian employment regulations. The Fair Work Act and SafeWork Australia set out the legal requirements for ensuring employee safety, fair pay, leave entitlements, breaks, and other workplace rights.
To formalise these obligations, it’s wise to implement legal agreements, such as Employment Agreements, which clearly outline the rights and responsibilities of both you and your employees. Additionally, Workplace Policies and Staff Handbooks can help streamline business operations and maintain a high standard of care in the workplace, ensuring compliance with legal and safety requirements.
Key Takeaways
Clearly, there’s a lot more that goes into a pottery business than beautifully crafted items! However, with the right legal support, you’ll be able to have a well protected business so you can focus on bringing wonderful products to life. To summarise what we’ve discussed:
- Starting a pottery business requires careful planning, including a business plan to assess costs, market, and competitors
- Choose an appropriate legal structure (sole trader, partnership, or company) based on your business’s needs, as each has different implications for liability and operations
- Register your business and obtain necessary documentation like an ABN, business name, and, if applicable, set up as a company with ASIC
- Protect your business with legal documents such as a Supply Agreement, IP Licence Agreement, NDA, and Service Agreement to reduce risks
- Comply with relevant laws, including data and privacy regulations, especially if collecting customer data or running an online store
- Follow Australian Consumer Law (ACL) to ensure fair treatment of customers, covering areas like warranties, advertising, and pricing
- Employment laws apply if you hire staff; use Employment Agreements and Workplace Policies to outline obligations and ensure compliance
If you would like a consultation on starting a pottery business, you can reach us at 1800 730 617 or team@sprintlaw.com.au for a free, no-obligations chat.
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