The Importance of Keeping your Beauty Business Legal

Just starting out in the beauty industry as a business owner?

As you plan your beauty or spa business, there are several aspects of conducting your business that have to be considered. Finding out after the fact that you should have had certain licenses or permits is sure prescription both for fines and penalties as well as increased scrutiny by government officials in the future. They really do not care that you did not know; they hear every excuse in the book when they catch someone.

Licenses and Permits

Licenses are certifications a local municipality, state or the federal government issue to verify that you are qualified to run the business offer your product to the market and have met all the appropriate registration, training, and fiscal guidelines. Everything from commercial trucker to restaurants have to possess certain types of licenses. In addition, there are general business licenses that virtually every place you can conduct business require.

In fact, business licenses and permits can range from the very general, like a basic license to operate within a city, to the very specific, like a state permit to sell firearms, fireworks or alcohol. You need to carefully review the various requirements and then proceed to the correct locations to secure the proper licensing. You ignore these regulations at your own peril and can put your business in jeopardy of temporary or permanent closings if you do not have the proper licenses or ignore their requirements.

To give you an idea of how far reaching these very important documents can be, below is an example of the city of Portland, OR general licensing guidelines, taken from the business section Q & A of their city web site:

———————————————————————————

WHO IS REQUIRED TO OBTAIN A BUSINESS LICENSE?

Prior to operating a business in the City of Portland, you are required to submit one of the following:

* City of Portland Business License Application
* City of Portland Exemption Request form
* Multnomah County ONLY Business Income Tax form

It is imperative to keep your spa business legal in all aspects from permits and licenses, to insurance and liability

There certain exemptions to operating a business without a business license. Exempt businesses must also submit a request for exemption.

They are (only the first one would be relevant to a spa or beauty industry business:

* Businesses grossing less than $25,000 per year from all sources before expenses. (Note: In license years 1993-1998, businesses grossing less than $15,000 per year were exempt).

* Insurance agents, agencies and other representatives as such. Note: “Representatives” means persons selling insurance or transacting insurance as a representative or agent of an insurance company. Such persons must be licensed and regulated by the State of Oregon Insurance Division. Please be aware that “domestic” insurance companies are not exempt.

* Real estate agents and associate brokers whose only business activity is real estate sales. Independent brokers are not exempt.

* Individuals whose only business activity is ownership of less than 10 residential rental units. Note: An individual is a natural person. Partnerships, corporations and all entities other than individuals may not look to this exemption.

——————————————————————————–

As this example illustrates, virtually every business endeavor is required to either obtain a license or to secure an exemption. Even your “out of the garage” lawn service typically needs some sort of registration or license if it is a full time job. With that in mind, it is important to know what to expect.