Is there a market for my idea?

L.Jenkins

I had an idea and I thought I'd share to see if there is a potential market for it. I'm hoping to move to Sligo in the next couple of weeks as an Engineering Contractor, but I'm considering setting up a business.

The business idea, to set up a Company to take on the self employed in an effort to provide them with a support base and increase their own business. With that, they could have their PRSI paid and other benefits as a full time employee. They would continue business as usual, but as an employee of a company. If they were to become sick, then they could claim.

To ensure the business is successful, the business could focus on one area, while branching off into other areas to give the self employed the supports they need, that they would not receive as a sole trader.

Any thoughts?

Graham

Sounds similar to the Umbrella companies that many IT contractors use.

Where's the margin for you? Are you an accountant?

How many self-employed people would you need to get on board for this to be viable? Are you liable for sick-pay/holiday pay/maternity leave, accident at work, long-term illness? Are your customers selling under their own name or your company name? If one of your customers signs a legally binding contract what liability does that open you up to, are they signing one behalf of your company? Do these 'employees' loose anything as they would no-longer qualify as a start-up business?

What expertise do you have to justify your role(and margin) in all of this?

You'd need to be fairly confident in this business model before you even thought about moving forward. If this crash-lands and leaves 'self-employed' people out of pocket, I can see lynch mobs and headlines.

mathepac

Graham wrote: »

Sounds similar to the Umbrella companies that many IT contractors use....

and which the tax-man is having a long critical look at from an expenses claims and "employee" status perspective.

rainbowdash

So if I am self emplyed and I charge a hotel chain, for example, 50K, for services for a year, I can deduct stuff like phones, car etc.

If I work for you then you will have to pay employers PRSI, which I believe is about 10%, and a margin for yourself, say another 10%. So I need to charge the hotel an etra 20%, why would they want to pay an extra 20%?

And self employed people are entitled to claim benefits if they are sick anyway, its just means tested.

srsly78

Yeah like rainbow says, who is gonna pay the employers prsi?

This sounds just like the aforementioned umbrella companies. Most contractors jump ship pretty quickly when they realise how much the service costs them.

The Corinthian

Any accountant that specializes in contractors will set you up with a shell company in a day as part of their services. As each contractor has their own company (in which they are a director and thus legally responsible) then things such as maternity leave, employers PRSI and so on become their problem, not the problem of a single umbrella company with employees who are not directors.

Your idea could have legs if you did it using a model like that and supplied additional services such as an office address, remailing services, call reception, boardroom facilities and the like, but even then you need to look at keeping your costs down, and perhaps looking at going into partnership with an accountant would be a good idea.

CelticRambler

Such an idea would be of interest to me (on behalf of others) as a hand-holding service for entry into the Irish market of foreign businesses. This could be, for example, a means to provide a probation period for a local (Irish) worker while either the worker or the market was tested; or as an umbrella service for the foreign worker. This would work particularly well for French-based employers who are reluctant to take on new employees because of the hassle involved in getting rid of them, but can't afford to let someone go "on spec" into foreign territory because they're already working to the max.

I have a particular interest in developing connections with the Sligo area, so if want to "explore possibilities" I'd be happy to trade some no-obligation ideas with you. PM if you want to take it further.