Page 59 - Retail World Magazine Jan/Feb 2021 TOB

FIVE LEGAL TIPS FOR STARTING A BUSINESS It’s important to take precautions to give your new business the best chance of success. BLy Gladwin Legal partner Rosalyn Gladwin. ast year was a challenging year, to say the least, but we’ve noticed that the challenges of Covid-19 and 2020 brought with it a host of new and ingenious business ideas that were ready to be executed in 2021. Starting your business can be daunting, and looking after the legalities is definitely not as exciting as working on your fancy website or packaging. Nonetheless, the legal structure can impact the value and profitability of your business. Consider these five tips. Branding When starting a business, one of the first things you’ll need to do is give it a name. Using descriptive words in your branding can be tempting, as these are likely to be easily recognised by consumers and translate to a real- world association with quality or the product (for example, ‘lovely’, ‘beautiful’, ‘perfect’, etc). However, when it comes to the trademarking process, this will be difficult to enforce, as IP Australia is reluctant to allow a descriptive word to be trademarked when it might need to be used by others in the industry. The less descriptive your brand name is, the greater protection you’ll likely be able to secure in in your trademark registration. If you’re unable to protect your brand name, then you may be at risk of needing to rebrand, which can be costly, time consuming and confusing for your customers. We recommend using a strong and distinctive brand name using the following guide: • Choose a name not currently being used by competitors nor able to be confused for a competitor by consumers. • Use a suggestive name that requires some thinking to figure out the connection with the product, or better yet, use a name that isn’t related to your product. Both of these factors will aid in trademarking the name in the future and standing out to your clients. • Consider whether you’ll be using a logo and how that will fit into the overall branding and trademarking process. • Register and protect your brand once you’ve settled on it. Research One of the first steps to consider when starting your business is what your strategy will be for it. Are you intending to run the business for the next 20 years, or to establish the business to sell, or are you looking for external investment? Depending on your answers, this will affect the process you adopt, including any lease obligations, written contracts, licences and permits and the business structure you chose. Get agreements in writing At the early stages of establishing your business, a lot of ‘handshake’ agreements are involved – in other words, agreement terms made with people who know people, and not properly documented. While maintaining good relationships with your suppliers, distributors and customers is important, these informal arrangements will cause headaches if a dispute arises, and can ruin friendships. When money is involved, the need for the terms of the agreement to be formalised in writing is greater. This will avoid a ‘he said, she said’ situation that can be costly to resolve, especially in the early days of your business. Poor cashflow due to payment disputes is probably the last thing you want to be dealing with. • We suggest, at the least, having formal contracts for: • Your contractors (especially governing IP ownership). • Website terms and conditions, privacy policy, shipping and delivery agreements. • Supplier and distributor agreements. • Employer and contractor agreements. • Partnership and shareholder agreements. Intellectual property As you probably have painstakingly established your brand, your intellectual property becomes one of your most valuable assets. It’s important this is protected. Among the more recognisable forms of intellectual property are trademarks and logos, including your brand name. Other forms of intellectual property include new inventions, trade secrets and confidential information, which should be protected through your agreements with third parties. Be aware of the laws Finally, and importantly, depending on what goods or services you’re intending to sell, additional obligations may be involved that must be complied with. For example: • The sale of food and drink will be governed by Food Standards. • The sale of goods and services will attract various obligations under Australian Consumer Law. • Collection of personal information will need to be in compliance with privacy laws. • Payment processing may require pay- per-click compliance. LEGAL About Rosalyn Gladwin Rosalyn is the principal of Gladwin Legal, being an expert in all facets of retail law, including commercial and corporate law and retail leasing. About Gladwin Legal Gladwin Legal is the law firm for retailers. As experts in retail law, the firm understands the legal matters that challenge retailers daily. Its areas of expertise include retail and commercial leasing, supply and distribution agreements, intellectual property, ecommerce and IT agreements, sale of business and competitions and trade promotions. Get in touch at gladwinlegal.com.au. JAN/FEB, 2021 RETAIL WORLD 57