Time to put away the scissors and curling iron? This article will set out key steps you will need to take or think about when you sell your hairdressing salon.
The Business Sale Agreement
Your hairdressing salon is sold by way of a sale of business agreement. A business sale agreement will have some standard terms and conditions. You are also able to add and negotiate your deal. As the vendor, and if you are in no rush to sell, you will be in good stead to negotiate your agreement so that will benefit you and your employees.
A standard contract for the sale of business will include some items that will be incorporated as part of the deal. Some of these are listed as follows:
1. The Business Name
You can transfer the name of your business to your purchaser. This will be included in the business sale agreement.
If you and the purchaser do decide to transfer your business name upon sale, you are required to notify the Australian Securities and Investments Commission (ASIC) of the transfer. You will then be given a transfer number to complete the transfer. If you and the purchaser decide to carry no longer on with the business name that your hairdressing salon operated in, you will be required to notify ASIC of the cancellation.
2. Intellectual Property
Any logos or pictures you have registered as a trade mark can be assigned to your purchaser. A special clause in your business sale agreement will need to reflect this. You should have a lawyer draft a clause that will be relevant to you.
3. Assigning your Lease to the Purchaser
If you have a lease for your business, you will need to transfer it to your purchaser as part of your business of sale agreement. Each state in Australia has its set of laws that deal with assigning a lease. Usually, you will need to gain consent from the landlord before assigning the lease.
4. Your Equipment
Over the years, your hairdressing salon is likely to have acquired many items that furnished your salon and equipment to perform your work. Things like your furniture, electronic grooming equipment and hair styling tools can be included in your package of sale should you wish. It will be prudent that you let your purchaser know exactly what you intend on leaving behind and including in the business sale agreement.
It is likely that your staff made your business a success. You obviously want their interests looked after. Your qualified staff are also a great asset to your purchaser. They will be trained and certified hairdressers who will likely have a regular client base.
There are some ways to look after their interest should you, the purchaser and your employees agree. Otherwise, unfortunately, you will have to terminate employment.
Transferring your staff to your purchaser:
- Your employees can be moved to the buyer if they agree and if the buyer agrees. This will need to be clearly set out in the sale of business agreement.
Termination of employment:
- The purchaser will have no obligation to employ any of your staff. In which case, you will need to terminate your employees appropriately. You will do this by providing your employees with a notice of termination and a final payment. The final payment must be made as a lump-sum and paid to any employees that are entitled to it. You will also need to ensure that any awards, employment contract, enterprise agreement or other registered agreement are complied with in making the final payment. Final pay payment includes things like paying for any unused annual leave or accrued long service leave.
If for some reason, you have no time to provide proper notice, you can make a payment instead of notice. LegalVision’s business lawyers can assist you with selling your hairdressing business. Questions? Call us on 1300 544 755.