How are you going about implementing your business plan and most importantly how are you going to do so legally and how are you going to minimise and manage the risks involved when starting a new business?

1. Do you have the right to do what you wish to do: 
a. Consider how you developed the idea; are you an ex-employee of a company, did you develop the idea when working for the company? If yes, it may be that your ex-employer may have some rights on your idea, get specialist legal advice on this point.

b. Consider whether you have developed the idea with one or more persons and who owns any generated intellectual property and how you are going to protect and exploit this. Again speak to a specialist intellectual property (IP) lawyer as soon as possible. The possibilities are various. In any case you need  contractual protection because remember the more people have contributed to your idea the more people will co-own it and will have a say on what to do with it which could lead to future problems. So put in place the necessary consultancy, employment or research and collaboration agreements.

2. Decide what is going to be your main market (local, national, international) and where if anywhere you should  protect  your product/services.

3. Decide the name/brand/logo of your business – in deciding your company’s or brand’s name consider trade mark and domain name registrations and make sure your protect your intellectual property and that it does not infringe existing brands. Also remember that by registering your company at the Companies House you do not get automatic trade mark or domain name registration protection.

4. How are you going to trade?
a. As a sole trader or in partnership: if you trade in your own name you manage yourself as a self-employed individual; you have unlimited personal liability  and you are personally responsible for the business debts with your personal assets in case of bankruptcy. When forming a partnership ensure that you have a partnership agreement drawn up.
 
b. Through a company: There are various types of companies and it is essential that you obtain legal advice at an early stage to ensure that you choose the correct type for your business so that your business is operating not only legally and help you achieve your objectives.

c. Buy into an existing business: whether you are purchasing shares or assets of a business, consider the tax and other business implications. Again an early meeting with your accountant and legal advisor will help you decide which road to follow and you will have the necessary backing in your purchase negotiation.

5. If you need to carry out research and development, please ensure that you have a collaboration agreement in place to cover critical points such as confidentiality, ownership of intellectual property and liability if something goes wrong.

6. How are you going to sell your products/services:

a. Selling direct:- when employing employees or consultants you must adopt contract dealing with employment, confidentiality and ownership of intellectual property issues

i. Via a business/shop: ensure that you have customer friendly terms of sale that are legally binding and comply with the latest laws. If you are selling to consumers you must ensure that your terms incorporate and comply with the consumers statutory obligations. Also you must ensure that you have terms with your suppliers addressing liability, payment terms and delivery terms. 
 
ii. Through the internet: invest in a good website that works for what you want to do, for example if you are using the website for marketing or selling:

1. Ensure that you have an agreement with the website developer/hosting provider to ensure ownership of intellectual property rights and agree an appropriate support and service level arrangement

2. Adopt terms of use and privacy policy for your website to ensure data protection compliance especially if your website will be hosted outside the EU or any personal information may be transferred outside the EU.

3. Adopt terms and conditions of sale to customers (B2B and B2C) and purchase from suppliers. Remember you must ensure that you terms are legally incorporated in your contract (with customers and suppliers) in order to avoid what is commonly known as “battle of the forms”. Consider whether you will be doing any bespoke development and have a written contract when you outsource or subcontract parts of the contract to third parties to pass on any obligations and responsibilities.

b. Distributors: you sell your products to the distributor, who then sells the products on to his customers, adding a margin to cover his own costs and profit. You may have less control over the distributor's activities and returns than you would over an agent that is why you must have a properly negotiated contract with him in order to address any potential competition issues.

c. Agents: an agent is appointed by you (the principal) to negotiate and possibly conclude contracts with customers on your behalf. The only contract for sale of the products is made between the principal and the customer. The agent generally has no contractual liability to the customer and is paid commission on the sales he makes, usually on a percentage basis. An agent may be protected by the UK Commercial Agents (Council Directive) Regulations 1993 which have business implications for the principal and a properly negotiated contract is hugely advisable.

d. Franchisees:

i. The franchisor allows the franchisee to use a name which is associated with the franchisor
ii. The franchisor exercises continuing control over the franchisee
iii. The franchisor provides assistance to the franchisee
iv. The franchisee periodically has to make payments to the franchisor

Intellectual property rights have particular significance because you will have built up a substantial amount of know-how and brand awareness, which you will need to protect and franchise agreements are generally complex requiring specialist legal advice.

7. Get help! No need to do everything on your own. Your legal advisor, accountant and business consultant are there to help you establish and operate a successful business. Talking to them at an early stage will help you minimise risks and liability exposure with an often minimal financial commitment.