For quite a while I've been working on a number of small business ideas which I am pretty well ready to get started on, most likely as part-time/supplementary earners, at least to begin with.

However, one matter which has held me back, as I was wanting to avoid any unpleasent stings in the tail of a start-up, was LIABILITY and the issue of Liability-Cover.

Two of my most promising ideas are for fashion items/jewellery from recycled materials, and furniture (shelving, chairs, tables, lampsahdes, other items with lighting, etc) from recycled materials such as industrial waste metal offcuts. The issue of liability has been taxing me, because especially in the case of large products such as recycled furniture and items incorporating electric lighting (Halogen or LED lighting) there is a significant safety factor, whether of people cutting/hitting themselves on sharp corners, or electrical dangers, and well, you will know what children are like, they will always find a way to circumvent the most stringent safety designs and precautions by any manufacturer.
I did ask various people about the issue of liability cover in the past, but what I was told was that it would 'be compulsory' (even if to begin with I only sold a few items over several months), it is very expensive (at least a few hundred pounds), and then there are issues like British Standards/kitemarks for products, and anything electrical has to be properly designed/ safety tested, etc. etc. (any electrical lighting in my products would be commercially bought units which would be ready-assembled and just housed in the appropriate item/housing I would make).

How should I approach the 'Liability' issue, then? Should I avoid making certain types of products (e.g. lampshades)? Even with some of the recycled fashion items I am designing, they use unconventional recycled materials which might be potentially imflammable or cause irritation (rubber, plastics, etc), so where should I start, and what kind of rules might apply?:confused:

all i know is if you set up a LTD you have to have public liability insurance and employment liability as they are always sold in a package.
hope this helps

LTD is always good, but expensive to set up

if the recycled clothing is used, make sure the labels have warnings which will always cover you as a manufacturer

Have you thought of selling stuff through ebay or similar as a private individual to start with? Surely all those thousands of people who sell things this way don't have/need liability insurance etc.

At least that way you could test the market before comitting yourself to £100's

Good luck

Have you thought of selling stuff through ebay or similar as a private individual to start with? Surely all those thousands of people who sell things this way don't have/need liability insurance etc.

At least that way you could test the market before comitting yourself to £100's

Good luck

That's a good point; I've heard that a lot of people make lots of money selling things over EBay, but the problem with that is that some of the items I would be selling would be quite large and would incur high postage/delivery charges for delivery outside Sheffield, never mind the problem if someone does not like an item and has to send it back; therefore I would be keener to have my products on sale through local design shops (there are lots whom I could approach), so local or visiting customers would buy them and have a chance tohave a really good look at them/try them out before taking them back home...

Thanks also, Stevey 90; re. the clothing items I am looking at making, they would use 'raw' materials such as recycled plastic/rubber made up into the appropriate items from scratch, so it would not be a case of using used clothing, more a case of creating items from scratch, so I would have to consider some kind of labels re. washing the items (i.e. by hand), although for the most part they would be more jewellery than clothing items.

Tyranna,

before you have me blocked once again from this forum.

read this



if you are serious about manufacturing items from clothing to household goods from recycled materials, i would look at the following first

1_ what area are you aiming at
2_ how diverse are you wanting to be with your creations
3_ is there a genuine market out there for your product
4_ the resale value of your item (time for labour involved, resources costs, P&P, advertising, TAX, etc)
5_ is it cost effective

before seriously going down this avenue, you should look closely at the market, sort out a business plan for profit and loss, dont just ask friends if they think it will work, ask people who dont know you, that way you should get a true feeling from genuine people.

before seriously going down this avenue, you should look closely at the market, sort out a business plan for profit and loss, dont just ask friends if they think it will work, ask people who dont know you, that way you should get a true feeling from genuine people.


Cheers, Eric, I'll look into it re. the points that you raised. it is definitely the best kind of market research to ask people who don't know you, as they will be just like day-to-day prospective customers and won't have the over-familiarity that close friends and family will have, which could indeed, give a false impression about how well one's product/service will sell...:D

Tyrana. I tried to PM you but you need to clear your inbox.

I think people are getting confused here over waht the question is about.

First the answers people have given are about Limited Liability in a business finance sense. The word Limited at the end of a company name means that the Liability of financial liabilites are left with the company and not the individual owners (so if it were to go bankrupt the debt is not going to be collected through the repossession of personal property, but this can be ecxepted). Also the point that was raised about a company who is limited needing liability insurance and employee liabilty, again this is a myth. If the company has no employees and just the directors acting as staff, no liability is needed. If there is a need for publuc liability insurance then this would need to be taken out, however, depending on the nature of a business public liabilty insurance may not be needed, for example an entertainment organiser may not need liability insurance as they may be able to underwite any eventualities themselves (although I am not 100% sure on the legislation now as it is a couple of years since i read up on it at Uni, so you may need publin liabilty, check it out!)

Now as to the original posters question. What yoy are looking at here is to get your items safety checked to see if they meet the birish and european standard of manufacturng. To do this for one off items will cost you alot of money as they will need to be indiviually tested for drabilty and also any safety elements like sharp and dangerous objects and also whether the electrical element is compliant with the current standard (at present PAT testing is done to check on this - an electrician is qualified to carry out these tests),

However the advice I have given here is of a personal opinion and not a professional one, so if you are wanting to go ahead with your business ideas I suggest you seek legal advice from a solicitor or the local business links. The business links usually offer their services for free to new enterprisesm and they will also help you with ideas to raise cash and also how to run the business ro marketing, to finanace to sales etc.

Hope this helps..

Try speaking to Senta (http://www.senta.co.uk/) They should be able to advise you or point you in the right direction

I make jewellery and I have public liability insurance.

I got mine for £47 from CMTIA. It covers me for £5million for a year.

all i know is if you set up a LTD you have to have public liability insurance and employment liability as they are always sold in a package.
hope this helps

I'm not relevant to the OP here, but I wanted to clear this up as it is a common misconception.

Public Liability insurance is generally optional.

Employer's Liability insurance is not necessarily required for a limited company. The following are exempt:

companies employing only their owner where that employee also owns 50% or
more of the issued share capital in the company.

Which I thought I ought to point out as many people reading this forum will be in this position or considering being in this position.

Also worth mentioning that employer's liability is almost always required if you employ people outside your family even if you are not Limited.

Info from http://www.hse.gov.uk/pubns/hse40.pdf