Candle Making Business at 14

DARCEYB

Hi everyone! I was wondering if you could help me out, so i’m trying to start up my own candle creating company and have done a lot of research and have seen that i need public liability insurance and need clp labels on my products. So i was wondering how i would go about getting the public liability insurance (my parents are all on board with the idea btw) I would be selling the products on facebook and to start with it would probably be sold to friends and family. So, can anyone give me any advice and tips? Thank you x

lincroft1710

It is doubtful any insurance company would deal with you directly because of your age. Your parents would probably havre to arrange cover

Sandtree

To be honest you will "probably get away with it" because age is not something normally asked about for business insurance. 

Just pinged an associate who works for a non-advisory broker and they advise there is no reason an under 18 couldn't buy one of their policies however they insist that payment is made from the insureds bank account and ordinarily under 18 accounts cannot do Direct Debits but if they have a debit card in their name then potentially they can pay in one lump sum and avoid that issue.

I can certainly see why insurers may not be too happy with it because the contract is legally binding on them but potentially not legally binding on a minor but then if you have paid the premiums in full up front there is little more you have to do as a policyholder anyway.

DARCEYB

Thank you for your reply, you have been a massive help, do you know of anything else i’ll need to start up my business (also i just realised i’ve put the wrong age i’m 15 not 14 lol)

DARCEYB

Sandtree said:

To be honest you will "probably get away with it" because age is not something normally asked about for business insurance. 

Just pinged an associate who works for a non-advisory broker and they advise there is no reason an under 18 couldn't buy one of their policies however they insist that payment is made from the insureds bank account and ordinarily under 18 accounts cannot do Direct Debits but if they have a debit card in their name then potentially they can pay in one lump sum and avoid that issue.

I can certainly see why insurers may not be too happy with it because the contract is legally binding on them but potentially not legally binding on a minor but then if you have paid the premiums in full up front there is little more you have to do as a policyholder anyway.

Thank you for your reply, you have been a massive help, do you know of anything else i’ll need to start up my business (also i just realised i’ve put the wrong age i’m 15 not 14 lol) 

Sandtree

Apologies, thought you were the "concerned parent" rather than the entrepreneur themselves  

In theory you need to inform HMRC about being a sole trader so that the taxes are done correctly... from memory it has to be done no later than 5 Oct the year of your first return (so in your case October 2021). I know there is a certain faff of doing for under 16s but don't know the details plus not sure if that will apply if you register after you are already 16 but are dealing with taxes due before you were 16 (this obviously assumes your business does well!)

There isnt much you are compelled to do but there are many things that are sensible to do... keeping receipts and records for 6 years. Separating your personal from "the business". Thinking about how and where you are going to sell your items. Make sure you consider all your costs so you don't sell things for a loss. Consider if you will be willing to send things to the USA (makes a big difference on the insurance). Read up on your customers rights if you are selling by mail order/website etc

The one downside of it all though, assuming you are doing this from home your parents probably will need to inform their Home insurance company and many don't like people running craft businesses from home... I would guess most who do this don't actually tell their insurers and many will get away with it but it can be an expensive mistake if a big fire happens and the insurers invalidate your cover because they find you've been running a production line at home. (Low risk but big consequences)

Brynsam

Good for you! All the business info you'll need here:https://www.gov.uk/browse/business

Be aware that the market is massively competitive, so perhaps a small trial run before you commit to any major expenditure? Getting your pricing strategy right is essential, so test the water before you go public with your brand name. Any number of candles for sale, of all sizes and descriptions, on ebay, so checking out which of those have sold/at what price is likely to be a good starting point.

Brynsam

Sandtree said:

To be honest you will "probably get away with it" because age is not something normally asked about for business insurance. 

Just pinged an associate who works for a non-advisory broker and they advise there is no reason an under 18 couldn't buy one of their policies however they insist that payment is made from the insureds bank account and ordinarily under 18 accounts cannot do Direct Debits but if they have a debit card in their name then potentially they can pay in one lump sum and avoid that issue.

I can certainly see why insurers may not be too happy with it because the contract is legally binding on them but potentially not legally binding on a minor but then if you have paid the premiums in full up front there is little more you have to do as a policyholder anyway.

Public liability insurance isn't compulsory in the UK, but it's probably no bad idea, especially if the business isn't a limited company (and I suspect it won't be, at least not at the outset).  However I think you're forgetting that the onus is on the person applying for insurance to disclose all material facts on the proposal form, whether or not a specific question is asked. The fact that the insured might be a child is most definitely a 'material fact' and the insurer could declare the policy invalid in the event of a claim.

DARCEYB

Thanks guys for all your comments, I have done a test run before spending lots of money and a lot have sold, the other reason why i did the test run is to take photos of the stock to upload, so it would all be legal for a 15 year old to start her own business then? thanks x

Savvy_Sue

Sandtree said:

The one downside of it all though, assuming you are doing this from home your parents probably will need to inform their Home insurance company and many don't like people running craft businesses from home... I would guess most who do this don't actually tell their insurers and many will get away with it but it can be an expensive mistake if a big fire happens and the insurers invalidate your cover because they find you've been running a production line at home. (Low risk but big consequences)

Too right: I attended fire marshal training with someone who worked for a large candle making enterprise. Several of us had our hair standing on end as they described the setup! Even though only on a domestic scale, please think carefully about where your stock and raw materials are stored (NOT under the stairs, NOT blocking a sensible exit route - no I don't know where that leaves!) 

Also insurance: one of my flatmates once lit a candle which then 'smoked' the wall behind it. They claimed on the candle-maker's insurance for re-decoration - might be worth keeping that kind of scenario in mind. 

[Deleted User]

DARCEYB said:

Thank you for your reply, you have been a massive help, do you know of anything else i’ll need to start up my business (also i just realised i’ve put the wrong age i’m 15 not 14 lol)

Wow, I’m a 13 and would never dream of starting a business (know quite a bit about business, just got nothing to sell), congratulations! As for the PL insurance, I think it’s something your parents will have to sort out for you. And good point @Sandtree about Home Insurance. As far as I’m aware there’s no minimum age to setting up a business, but be careful, you don’t want to get your fingers burnt (please excuse the very bad pun!) by wasting money and time on something with little success.