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  • #969122
    m2nb
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    • Total posts: 56
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    hi guys!
    im new to all this so please bare with me (this might be long sorry)…

    im currently in the process of setting up a small beauty business.. i have my premises, shop equipment and am now just waiting on council.

    As the business is situated in a small country town i have been talking to locals and have been getting very positive vibes. Im a qualified beautician and was planning on just offering manicures and pedicures, facials, tinting and make up to start off with but after talking to the locals a lot have been asking if i will be doing waxing. i have some equipment for it from when i did my course but i am not 100% confident in the procedure and admit its not my forte and im worried that this will reflect on my clients and i really want to put them at ease.

    now here comes my idea.. i have a really good friend who has a slightly higher qualification in beauty and waxing IS her forte.. i would be happy to do facial waxing as im very comfortable with that but the rest im not so sure about. She is quite willing to help out and has said if i ever need help just to let her know.. but how would it all work? in terms of hiring her i dont want to do the wrong thing.

    i cant exactly afford to employ her not at this stage but would i be able to hire her as a contractor and get away with it? she would have her own abn, set her own prices for the services she will do and will just pay me a small percentage towards rent etc? is that legal? i know when i started someone approched me to do something very similar for them but im just so new to all of this and don’t want to do anything illegal

    any advice you more experienced people can give me would be great! im only 20 so im still learning as i go

    thanx for reading! =)

    #1036988
    c2cemploymentrelations
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    • Total posts: 31
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    Hiya

    This is a fairly common question small business owners find themselves in – often it’s because they can’t guarantee a steady income and set hours and therefore automatically jump to making people an independent contractor.

    The issues you have if you set her up as an independent contractor is while she may have her own ABN, if she injures herself onsite or doesn’t have up to date insurances then you may be considered liable if she injures herself or has an issue with one of your clients. The other issue you have is if she’s working regularly and systematically is ensuring she pays her PAYG and if she earns over $450 gross per month her super. However, if she’s setting her own hours and determines how she does the work, as well as setting her own charge rates she may well be able to be classified as an independent contractor.

    Another option would be to set her up as a casual employee – you would be responsible for paying her the Award wage plus 25% casual loading, workers compensation and super if she earnt over $450 gross per month but you could then ensure she is paying PAYG and is covered by your insurances. This would also limit any claim for backpay in the future if it is determined she is an employee not a contractor.

    The ATO has a great Independent Contractor v Employee tool on their website but keep in mind the ATO has different legislation to Fair Work who governs employment.

    You need to do a little more research and flesh out a bit more how the arrangement would work to determine which way to go to minimise the risk to your business. Either way ensure that the agreement you decide upon (employee or independent contractor) is in writing and the terms of the agreement are set out and signed by both parties.

    Good luck!!
    Brooklin
    Director
    C2C Employment Relations
    http://www.c2cemploymentrelations.com.au

    #1036989
    Jake@EmroyPrint
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    Hi M2,

    A friend of mine was in a similar position when he opened his salon, his decision was to rent rooms for $x amount per day, so in effect he became a supplier.

    Brooklin above made some fantastic points about insurance, I would recommend you do a bit more research into that or consult an expert to confirm you have the right cover (Looks like Brooklin would be a good choice).

    Best of luck!

    – Jake

    #1036990
    DavidM
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    • Total posts: 329
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    Hi m2nb.

    Brooklin does offer good advice. It’s important to be aware that it’s your working relationship that determines whether you have an employee or a contractor – not simply you saying ‘She’s a contractor.’ This can be a bit of a grey area. Although everyone’s different, and it will depend on the business name she’s trading under and the hours that you govern, I think your best bet would be to sett her up on a percentage wage which also incorporated workcover and superannuation.

    Brooklin will be able to help though.

    Good luck,
    David

    #1036991
    m2nb
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    • Total posts: 56
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    thanks for the advice so far!

    its given me a lot more to think about now..

    after doing some research into the awards etc i really cant see me being able to employ her as a casual since at this stage im not even sure how much money the business would be making and since i would have to employ her for a minimum of 3 hours per day i dont see how it would work..

    and you have raised good points about the contractor side of things to… its very hard since im not sure how much work would be there for her in terms of the waxing..

    keep the replies coming please everyone i really want a solution =)

    #1036992
    melbstrip
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    • Total posts: 114
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    Workcover is a definite factor to consider, it was one I faced.

    According to Workcover, even an independant contractor, if the majority of their income is from one source, that business is viewed as an “employer” and must cover them with Workcover insurance.

    Agree with above, you need to get expert advice on this and good plan in place.

    #1036993
    m2nb
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    • Total posts: 56
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    David,

    what did you mean by setting her up on a percentage wage.. what does that mean and how does it work? ive never heard of that

    #1036994
    Anonymous
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    • Total posts: 11,464
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    Hi m2nb

    Welcome to Flying Solo! (Apologies for the impersonal hello though… you forgot to tell us your name!)

    I’ll keep out of the discussion about contracting vs. wages etc as that is not my area of expertise, but wanted to let you know that I think it’s great that you’re looking for a solution to this gap in your service offering before you open.

    In a previous life I was involved with a very busy beauty spa, and can tell you that their bread and butter (the bulk of the daily turnover) came from waxing. Furthermore, because clients need their waxing done on a regular basis, it provided a good opportunity for staff to develop relationships with them, which in turn meant they were able to up-sell them to other services and products.

    My understanding is that this is consistent with the experiences of other businesses in that industry, so it does seem worth your while to find a way to incorporate it into your offering, and to make sure that you’re deriving some income from it. Given your prospective clients are asking the question before you open, it seems there is a definite market for waxing in your region.

    If you’ve still got some time on your hands until your premises are available, do you have the option of using that time to get your own waxing skills up to scratch?

    My concern for you is that if clients need to go somewhere else to get their waxing done they may not come back to you.

    All the best to you for your new venture by the way – your enthusiasm really comes across in your posts, and I’m sure your business will be very popular.

    Best wishes,
    Jayne

    #1036995
    m2nb
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    • Total posts: 56
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    FS Concierge, post: 44692 wrote:
    Hi m2nb

    Welcome to Flying Solo! (Apologies for the impersonal hello though… you forgot to tell us your name!)

    I’ll keep out of the discussion about contracting vs. wages etc as that is not my area of expertise, but wanted to let you know that I think it’s great that you’re looking for a solution to this gap in your service offering before you open.

    In a previous life I was involved with a very busy beauty spa, and can tell you that their bread and butter (the bulk of the daily turnover) came from waxing. Furthermore, because clients need their waxing done on a regular basis, it provided a good opportunity for staff to develop relationships with them, which in turn meant they were able to up-sell them to other services and products.

    My understanding is that this is consistent with the experiences of other businesses in that industry, so it does seem worth your while to find a way to incorporate it into your offering, and to make sure that you’re deriving some income from it. Given your prospective clients are asking the question before you open, it seems there is a definite market for waxing in your region.

    If you’ve still got some time on your hands until your premises are available, do you have the option of using that time to get your own waxing skills up to scratch?

    My concern for you is that if clients need to go somewhere else to get their waxing done they may not come back to you.

    All the best to you for your new venture by the way – your enthusiasm really comes across in your posts, and I’m sure your business will be very popular.

    Best wishes,
    Jayne

    thank you Jayne!!

    by the way my name is Alyce =)

    you raised some very good points, i may need to do what you said and just bite the bullet and do it myself i passed my waxing i know the procedure so i guess i just need practise..

    i would have a couple of weeks to get my skills up to scratch and also hunt around for some more supplies for the waxing on what i have left in my budget (eekk!) do you think that it would still be effective if i offer some waxing services such as facial waxing (which ive been asked about the most) and letting my clients know that i will be offering more waxing services at a later date? or would that scare my clients away also? no one in the town really offers these services at the moment since they have all moved away which means people are having to travel 45kms just to get these beauty services done! in saying that though it sounds like i may have some competition later on as someone else is also trying to start a beauty business

    i am very excited about this and will do anything i need to, to make it work =)

    #1036996
    King
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    • Total posts: 2,212
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    just opened my BAS form envelope and in the info there is this link http://www.ato.gov.au/employeecontractor – they will no doubt have good info

    #1036997
    ndreamer
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    • Total posts: 16
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    m2nb, post: 44645 wrote:
    hi guys!
    im new to all this so please bare with me (this might be long sorry)…

    im currently in the process of setting up a small beauty business.. i have my premises, shop equipment and am now just waiting on council.

    As the business is situated in a small country town i have been talking to locals and have been getting very positive vibes. Im a qualified beautician and was planning on just offering manicures and pedicures, facials, tinting and make up to start off with but after talking to the locals a lot have been asking if i will be doing waxing. i have some equipment for it from when i did my course but i am not 100% confident in the procedure and admit its not my forte and im worried that this will reflect on my clients and i really want to put them at ease.

    now here comes my idea.. i have a really good friend who has a slightly higher qualification in beauty and waxing IS her forte.. i would be happy to do facial waxing as im very comfortable with that but the rest im not so sure about. She is quite willing to help out and has said if i ever need help just to let her know.. but how would it all work? in terms of hiring her i dont want to do the wrong thing.

    i cant exactly afford to employ her not at this stage but would i be able to hire her as a contractor and get away with it? she would have her own abn, set her own prices for the services she will do and will just pay me a small percentage towards rent etc? is that legal? i know when i started someone approched me to do something very similar for them but im just so new to all of this and don’t want to do anything illegal

    any advice you more experienced people can give me would be great! im only 20 so im still learning as i go

    thanx for reading! =)

    she will need personal liability insurance, public liability insurance at the minimum.
    You really should see an accountant and workcover for the other liability’s.

    #1036998
    Anonymous
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    • Total posts: 11,464
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    m2nb, post: 44696 wrote:
    i would have a couple of weeks to get my skills up to scratch and also hunt around for some more supplies for the waxing on what i have left in my budget (eekk!) do you think that it would still be effective if i offer some waxing services such as facial waxing (which ive been asked about the most) and letting my clients know that i will be offering more waxing services at a later date? or would that scare my clients away also? no one in the town really offers these services at the moment since they have all moved away which means people are having to travel 45kms just to get these beauty services done! in saying that though it sounds like i may have some competition later on as someone else is also trying to start a beauty business

    Go Alyce! You sound like you’re on fire!

    Personally, I’d be more inclined to spend money on waxing supplies than some of the other equipment you’re going to be needing. And if you have a competitor hot on your heels, then even more reason to be covering that base from the get-go.

    In terms of offering some services now and others later, maybe you should do a small market research survey. For example, ask a dozen of your local girlfriends what their thoughts are on the dilemma (don’t forget to tell them you want the honest truth, even if it’s brutal!). Record all their responses, and you’ll soon have an instinct about the right way to go.

    You might even find some volunteers who are prepared to let you practice your technique on them.

    Good luck – let us know how you get on!

    Jayne

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