Starting my own business

[Hairoholiclady]

Can anyone be of help please..

I have recently been given the opportunity to take on the salon I have been working in as a self employed hair stylist.

I just want to know what I should make sure I know about or have asked questions about because as far as I'm aware the lease is just being signed over to me and then it's the case of setting up accounts for the other Bill's like electric, water etc in my name.. it just seems too good to be true at the moment because it seems to easy, but I trust my 'boss' and I am meeting the landlord of the premises soon but it's going to be a very quick turnover and I need to know everything I should be thinking about.

Thanks in advance!

 

[BannerPenguin]

Hiya.

I'd be very careful here... you aren't a self-employed therapist, it would be your whole total business. I have no idea where your 'boss' comes into this if everything is signed over to you - very unusual.

Also, signing a lease has a LOT of responsibility. I'd be getting it checked by a solicitor. You're responsible for repairs to the building and all sorts normally. I wouldn't be rushing anything no matter how quick she wants to move it on.

Any idea why she wants to drop her whole business in your lap and leave?

 

[Hairoholiclady]

Hiya.

I'd be very careful here... you aren't a self-employed therapist, it would be your whole total business. I have no idea where your 'boss' comes into this if everything is signed over to you - very unusual.

Also, signing a lease has a LOT of responsibility. I'd be getting it checked by a solicitor. You're responsible for repairs to the building and all sorts normally. I wouldn't be rushing anything no matter how quick she wants to move it on.

Any idea why she wants to drop her whole business in your lap and leave?

Hello,

Sorry I've made that sound really bad, her reasons for leaving are legit and essentially her business is closing and I will be opening mine so it will be a completely new business and mine.

And I know I'm responsible for repairs to the building and I have personally had it checked out and happy with what repairs need doing and because of that the landlords are happy to just write up a new contract/lease/license with my name on it and not charge me for a new lease. But because I am new to this side of things I just wanted to get my head around what things I need to think about other than just the everyday running costs of a salon. Thanks xx

 

[AcidPerm]

...But because I am new to this side of things I just wanted to get my head around what things I need to think about other than just the everyday running costs of a salon. Thanks xx

That’s what solicitors are for.
Definitely take legal advice when you receive your draft contract to ensure there are no hidden surprises.
How long is the minimum term?
Are there any employed staff working in the salon?

 

[hazelb]

Get legal advice.
You need make sure that you understand exactly what you are getting.

Is it just the business premises? With rent, rates, repairs.
Is she taking all her equipment and client with her?
Are you buying the business with her client list and other employees / self employed people working there?

Never trust your boss. She may be brilliant at her job but understand nothing about the legal requirements when transferring a business. People can have very strange ideas about what’s an acceptable process - when it’s totally inadequate and can leave a mine field behind.

Get legal advice and use a solicitor for the process. If you think that costs too much, it would be nothing compared to the problems that could arise if things go wrong. Just look at some of the old threads on here!

 

[TheDuchess]

This sounds like a really sweet deal and almost too good to be true. Your "boss" and landlord will be thinking the same thing! I was lucky enough to benefit from a similar arrangement to you when I first set up. I went to a solicitor for advice but he looked at the actual lease rather than how it could be used to reflect the overall business arrangement - if I'd been better guided I could have negotiated a better deal for myself.

You need to bear in mind that an outgoing tenant is normally required by her lease terms to leave the premises in ready to relet condition. Your "boss" is likely to save herself hundreds if not thousands of pounds by assigning the lease over to you, and not having to pay rent whilst she redecorates after she's closed down. Are you buying her stock, equipment and fitment and furniture? Don't forget that moving out isn't cheap and storing stuff til it's sold on eBay is a hassle.

Your landlord is saving business rates on an empty property whilst he looks for a new tenant - cos rates have to be paid by someone. You probably qualify for business rates relief but as he's unlikely to have just one commercial premises, he'll have to pay if he has no tenant and it's a lot of money. He'l also save on estate agents fees to market the property and he also won't have a gap in rent payments. So he's making/saving thousands more than if you rented another property elsewhere and he had to find a new tenant.

If I were you I'd look at other premises and make it clear to your boss and landlord that you are conducting a value for money exercise. Point out the benefit of letting a property that has just been done up and starting your business with nice new fittings. Say that your clients will follow you to another town if they had to. If your "Boss" and landlord think that they might lose you, they might offer you improved terms.

The best professional to advise you is a commercial surveyor. A surveyor will haggle on your behalf and will know what the "going rate" is. He'll also point out things that you might not know about which can be included in the rental and lease negotiations.

Some pointers for you to consider:

Does the property need any redecorating or maintenance? If the landlord was marketing the property on the open market would he repaint the exterior and spruce up communal areas etc?

Will a new periodic electrical inspection certificate be done for you or will that be your responsibility? The last lease I signed didn't mention the electrics as these should have been legal.... Then I discovered that the inspection was over due - I had to do an inspection and it turned out that over £1000 work was required.

Check the fire certificate. Have the fire extinguishers been checked in the last year? Does the emergency lighting and exits meet current regulations?

How is are the premises heated? Is this the most cost effective heating? What about the water heating? How old is the plumbing etc.

What are the exit terms for your "boss"?. Is she saving money by assigning the lease over to you? Are you buying stock/improvements etc off her? Is the money that she is saving equal to your financial benefit?

When you exit the property, don't forget your lease terms may require you to hand the property back in immaculate condition. You might even be liable for building repairs going back years. Don't rely on any assurances that the landlord won't ask you to do this. Look at the terms of the lease. Remember that your landlord might decide to retire and the property could get sold to a new landlord who will hold you to your lease.

So my advice is don't be too hasty as you might inadvertently sign for costs that you hadn't considered. It's very unlikely in the current market that there is someone else panting for the premises or the business. Get a surveyor to advise you.

Good luck