How To Start A Hospitality Consulting Business

Entertainment, food, drinks and travel – all of these fall under the broad umbrella of the hospitality industry. No doubt, the hospitality industry is big and often, buzzing. As long as people want to be fed, entertained and taken care of, there will always be a need for hospitality. 

As fun and promising running a hospitality venture might sound, there’s a lot of different things to consider. Whether it’s a small corner cafe or a large scale hotel, managing a hospitality business correctly is no easy task. That’s why some business owners like to call in reinforcements in the form of hospitality consultants. 

A hospitality consultant uses their experience and expertise to advise hospitality businesses to better their business. If this sounds like something you might be great at then starting a hospitality business might be for you! 

Before you start helping other businesses though, let us walk you through the legal considerations for getting your hospitality consultancy business started. 

What Is A Hospitality Consultant?

A hospitality consultant is someone that has a strong background in hospitality. They provide their valuable advice to other hospitality businesses. Remember, hospitality is a pretty broad industry, so most hospitality consultants might focus on a niche area. For example, a consultant that is well-versed in food and drink, may offer their services to restaurants and cafe owners only. 

How To Become A Hospitality Consultant 

There’s no strict code on how to become a hospitality consultant. Instead, it’s important to have the right knowledge and experience. If you’re interested in pursuing a career as a hospitality consultant, consider obtaining the right qualifications from the industry and gaining relevant work experience. Remember, a consultant doesn’t give general advice a business owner could find elsewhere. Rather, their expertise allows them to provide high level, expert advice. It’s important to make sure you’re able to meet this standard prior to becoming a consultant.  

Where Do I Begin Starting My Hospitality Consulting Business?

One the first steps to starting your hospitality consulting business, is taking the time to research and plan your business. Even if you feel like you’ve got everything sorted in your head, it’s always better to write it all down in a Business Plan. That way, you’ll have something you can always look back on that will keep you ontrack. Plus, when everything is written down in one place, it’s much easier to identify your business’s strengths or weaknesses and work them out.   

How Do I Register A Hospitality Consulting Business?

After you’ve established your plans, it’s time to set them in motion. The first step to doing this is picking out a legal structure for your hospitality consulting business. On average, business owners tend to register a sole trader, company or a partnership legal structure. These three are pretty different from one another, so keep reading to learn more about them. 

Sole Trader:

The name gives it away – a sole trader is the only owner of the business. Starting business as a sole trader means you alone will be responsible for the entire business. As a result, the liability of the whole business will fall on you personally as there is no legal separation between you and your business.

To register your hospitality consulting business as a sole trader, you just need to get a let Inland Revenue know about you business plans, which can be done online. You can also get an NZBN however, that’s totally optional.

Company: 

Registering A Company is a little more complex, as a company is considered to be a legal entity on its own. Therefore, the company can own property, earn a profit, accumulate debt and have ongoing court matters. This is beneficial for business owners, as you will be able to limit your personal liability. 

Registering a company requires getting more details together, figuring out how your hospitality consulting business will be governed and then registering it according to Companies Office regulations. It’s best to get the help of a legal expert to make sure everything works out perfectly. 

Partnership: 

If you’ve decided you’re going to start your hospitality consulting business with someone you trust, then you’ll be operating in a partnership structure. Partnerships require a little more work, as it’s important for both partners to be on the same page regarding matters like management, profit share, dispute resolution and the process for leaving the partnership. 

It’s better for both partners and the business to have everything sorted prior to starting a business together. Before you register your company as partners, it’s best to have all the key partnership legal agreements sorted, like a Partnership Agreement.  

The choice you make about your hospitality consulting business’s legal structure will lay the foundations for your business, so it’s important to make sure it’s a well-informed choice. To learn more about business structures, you can check out our helpful guide here.

Do I Need Any Legal Documents For My Hospitality Consulting Business? 

Legal agreements are one of the main instruments you’ll need to use to protect your hospitality consulting business and ensure everything runs smoothly. The exact legal documents you will need are going to depend on your specific business operations – one of our legal experts will help you figure all that out. 

We’e compiled a general list of the kind of legal documents a hospitality consulting business might require. 

Consultancy Agreement: A consultancy agreement is the main legal document your clients will sign before you begin business. The agreement sets the tone for your relationship with them, and covers important matters like scope of work, payment, responsibilities and termination.

Non-Disclosure Agreement: As a business owner, there are certain matters you’ll need to keep private. In order to protect your business’s information, having an NDA ready is important.   

Privacy Policy: If you’re going to have a business website, then a privacy policy is important. If your business collects personal information from its users, you’re legally obligated to have a privacy policy in place. 

Business Terms and Conditions: When others interact with your business, it’s important to set some ground rules. Terms and conditions can help do this, while protecting your liabilities and ensuring you have control where necessary. 

Cookie Policy: Unlike a privacy policy, a cookie policy isn’t necessarily legally required. However, it can help promote transparency with your online community, which is always a plus. 

Any Other Legal Considerations?

As you might have figured out by now, the law plays a pretty vital role in business matters. Therefore, when you start your hospitality consulting business, it’s of utmost importance to be aware of what regulations might affect your business. We’ve addressed a few key ones below.  

Consumer Law  

When you’re dealing with clients, it’s important to understand that as consumers, they have rights under consumer law. As a business, it’s your legal duty to uphold these rights and ensure your conduct is in line with consumer regulations. Generally, consumer law requires transparency, fairness and honesty. Even with the best intentions, mistakes can happen. In order to avoid this, it’s important that you properly understand your obligations under the Consumer Law so you can fulfil them with confidence. 

Data and Privacy 

We mentioned having a privacy policy in place (see above) however, as a business there might be other data and privacy regulations you will be subject to. For example, if you’re going to be storing information about your clients on your database, then you may need to take steps to secure and maintain their privacy. Legal instruments like a Data Breach Notification might come in handy. 

Intellectual Property 

It’s also crucial to be aware of your intellectual property (IP) legal considerations. Your hospitality consulting business’s IP might be one of its most important assets. For example, you may have a logo or business name you’d like to Trade Mark or resources such as presentations and original strategies that are copyright material. In which case, you’ll need to look into getting an IP Licence. Securing your IP can save you a lot of trouble down the line, so it’s best to get it sorted ASAP! 

Next Steps 

A hospitality consulting business can be a great new venture, just be sure to secure your business with the right legal protections. To summarise what we’ve discussed: 

• Hospitality consulting involves providing advice to hospitality businesses
• Qualifications and relevant experience are important for consultants
• Start by researching and creating a business plan
• Choose a legal structure for your consulting business: Sole Trader, Company, or Partnership
• Each legal structure has different implications for liability and registration
• Legal agreements are crucial for your business, including Consultancy Agreement, Non-Disclosure Agreement, Privacy Policy, Business Terms and Conditions, and Cookie Policy
• Consider legal regulations like consumer law, data and privacy laws, and intellectual property protection
• Data protection measures, including a Data Breach Response Plan, may be required
• Legal guidance may be needed to navigate the complexities of starting a hospitality consulting business

If you would like a consultation on your options moving forward, you can reach us at 0800 002 184 or [email protected] for a free, no-obligations chat.

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