In this blog, I am talking about why every Australian business needs a privacy policy. I’ll cover ethical benefits, legal risks, and simple steps to build trust and stay ahead of compliance changes.

Ever caught yourself thinking, “Privacy policy? That’s something only big tech or big banks need to worry about, right?” If you’re a solo business owner or running a small, service-based venture, you might assume a privacy policy belongs way down at the bottom of your priority list (somewhere between ‘redo website fonts’ and ‘finally sort out inbox folders’).

After all, under current Australian law, many small businesses (with turnover of $3 million or less) don’t have to comply with the Australian Privacy Principles (APPs) unless they’re dealing with people’s health and wellbeing. It’s called the small business exemption. In plain speak? If you’re a tiny operation and you’re not collecting highly sensitive information, you’re not legally required to have one of those lengthy privacy documents… for now.

But here’s what you might not know: having a privacy policy could be one of the smartest, simplest ways to boost your credibility, strengthen client trust, and show that you take their personal information seriously – whether the law says you must or not. Plus, there’s change in the air. That exemption might not last forever (it’s currently under review in the second round of reforms to the Australian Privacy Principles).

So, why is a privacy policy a win-win for you and your clients? Read on to find out.

What Is a Privacy Policy, Anyway?

Think of a privacy policy as a friendly little guidebook that explains how you handle your customers’ personal data. In plain English, it’s a document that tells people what personal information you collect, why you collect it, who you share it with, and how they can find out what information you hold about them.

Say you run a mobile pet grooming service. You’re probably collecting clients’ names, addresses, pet details, maybe even snapping a few cute doggie photos (who could resist?). Your privacy policy is where you tell your customers: “Here’s the info I collect from you, here’s what I do (and don’t do) with it, and here’s how I keep it safe.”

Or maybe you’re a virtual assistant (VA) who manages client emails, calendars, and invoices. You’re handling names, addresses, payment details, and potentially sensitive business info every day. Your privacy policy explains how you protect all that information – whether it’s stored in Google Drive, Xero, or the latest project management tool everyone’s talking about.

If you’re a business strategy coach, you might collect personal stories, financial goals, or mindset struggles that clients share in confidence. Your privacy policy helps build trust by showing exactly how you respect that information and ensure it stays private – whether you’re taking session notes on paper or using a client management system.

A solid privacy policy typically covers:

• What kind of personal data you collect (names, emails, phone numbers, maybe birthdays if you’re sending promo codes – you name it).
• Why you collect it (to schedule appointments, send invoices, or improve your services).
• How you store and protect it (Locked filing cabinet? Encrypted cloud storage? A ferocious guard dog named Sniper? 🐕).
• Who you share it with (you might think you don’t share client data, but once you start listing all the programs you use – bookings, calendars, accounting, CRM, emails – you’ll realise otherwise).
• How clients can access or correct their data (because they have a legal right to know and to make changes).
• How to complain if something goes wrong – and what you will do if there’s a breach (hopefully you’ll never need this, but it’s better to have a plan).

No one expects you to turn into a lawyer overnight. But if you’re not being open and clear with the people who trust you with their personal info – and you’re not taking that responsibility seriously – you’re exposing your business to an unnecessary level of risk.

The Ethical Edge: Transparency = Trust

Being upfront about your privacy practices isn’t just a nice touch – it’s the right thing to do. It shows clients you respect them and the personal information they’ve entrusted to you. At its core, a privacy policy is simply a vehicle for transparency. It openly spells out your data practices so customers can make informed decisions about sharing their details.

When you candidly explain, “We collect your email to send appointment reminders, and we promise not to sell or misuse it,” you’re showing you take their privacy seriously. No fine print. No shady clauses. Just common sense and respect.

Why does this matter? Because trust is the currency of modern business. You’re not just selling a service – you’re inviting people to trust you. Especially in service-based businesses, where relationship-building is vitally important. A privacy policy isn’t just a legal document; it’s a promise that you’ll do the right thing with the information they choose to share with you. It signals that you have ethical data management practices, strong cybersecurity, and that you’re holding yourself accountable for keeping their details safe.

Clients are far more likely to relax, open up, and stick around when they know their data (and by extension, they) are respected. Think about it – you wouldn’t appreciate a friend rifling through your phone without asking, right? In the same way, customers value knowing exactly what’s happening with their information. By being transparent, you’re essentially saying, “I value your privacy as much as you do.” That builds trust – and trust builds loyalty.

In an era where news of data breaches and creepy marketing tactics are everywhere, being the honest, transparent business owner sets you apart. Some might even call it a moral imperative – doing right by your clients because it’s the right thing to do.

As a bonus, when people trust you, they’re not only happier to share their info, they’re more likely to recommend you. Your reputation grows as a business that does things properly. It’s an ethical win that also happens to be a marketing win – a two-for-one deal – with zero spam involved.

Professionalism and Credibility Boost

Beyond ethics, let’s talk practical perks. Having a privacy policy – even when the law doesn’t force you – instantly levels up your business credibility. How so? For starters, it shows you’re organised and forward-thinking. Customers (and potential collaborators) see that you’ve put genuine thought into how you handle data. It positions you as a trustworthy custodian of their personal information. In other words, you look like a business that has its act together – not a fly-by-night operation.

A clear, thoughtful privacy policy can enhance your reputation and give you a quiet competitive edge, marking you out as someone who takes their clients seriously.

And then there’s B2B opportunities: if you ever want to work with larger companies, government contracts, or high-profile clients, they’ll almost certainly ask about your privacy practices. Being able to say, “Yep, we have a privacy policy – and here it is,” screams credibility. It can be the difference between looking like an amateur and landing the deal. This is professionalism 101 in the digital age.

On a more nuts-and-bolts level, having a privacy policy also helps with the day-to-day running of your business:

Online Services – Planning a website with a contact form or analytics? Many third-party services (think Google Analytics, Google Ads, or Facebook Pixel) require you to have a privacy policy in place. Without one, you may not be allowed to use their tools or run ads – which could seriously cramp your marketing plans. Plus, with the latest changes to the Australian Privacy Principles, you’ll now need to declare any tracking pixels you use (no more hidden data collection).

SEO Brownie Points – Search engines like Google look for privacy policies. Sites that show a clear commitment to user privacy can get a (small but helpful) boost in search rankings. It’s not magic SEO fairy dust – but every little bit helps when you want your business to be found online.

Preventing Headaches – You’ve heard the saying, “An ounce of prevention is worth a pound of cure.” Having a clear privacy policy helps prevent misunderstandings. If a client knows up front that you’ll be emailing them a monthly newsletter because they gave you their email, they won’t be surprised (or annoyed) later. You’re setting expectations early – and saving yourself awkward conversations or lost trust down the track.

In short? A privacy policy makes you look good. It tells people you’re not running things by the seat of your pants. You’ve dotted the i’s and crossed the t’s when it comes to respecting their data. And that’s a serious credibility boost for any small business.

Future-Proofing: Stay Ahead of Changing Privacy Laws

Let’s put on our fortune-teller hat for a moment. Sure, right now your small business might be flying under the legal radar thanks to the small business exemption. But privacy laws are tightening globally – and Australia is no exception. The government has been reviewing the Privacy Act and, as of December 2024, they’ve agreed in principle to remove the small business exemption. In plain terms, this means that in the near future, all businesses (yes, even little guys like us) may have to play by the same privacy rules as the big companies.

The exact timeline isn’t set – they’re planning to consult with the small biz community first and offer support and a transition period – but the direction is clear. Right now, about 95% of Aussie businesses are exempt. That’s a lot of businesses that could soon be scrambling to comply.

By preparing now, you’re saving yourself from a potential last-minute panic if (or when) the law changes. Remember the kerfuffle around GDPR? It’s like investing a bit of time today to save yourself a ton of stress tomorrow. Future-proofing your business means you won’t be caught off guard. You’ll already have that privacy policy box ticked, and compliance will be just business-as-usual.

Even if the law didn’t change (and let’s be honest – it’s VERY likely that it will), consider this: customer expectations have already shifted. Consumers today – especially those who’ve experienced data breaches – expect every business to take their privacy seriously, no matter how small. You don’t want to be the one saying, “Oh, I never bothered with that,” while your savvy competitor is proudly showcasing their privacy practices and winning customer trust.

Staying ahead of the curve means you’re ready for whatever comes – whether it’s new laws or simply a more privacy-conscious client base. And if you plan to grow (who doesn’t?), your business might not stay “small” forever. Cross that $3 million turnover or expand your services, and you’ll be glad you laid a strong privacy foundation from the start.

The Risks of Ignoring Privacy Compliance

Whether you’re a consultant, a freelance graphic designer, a marketing coach, or run the best cake shop in town, consider this your gentle-but-firm nudge: it’s time to get that privacy policy drafted. It doesn’t have to be perfect. It just has to be authentic and transparent. You’ll be ethically ahead of the pack and practically prepared for whatever the regulators or the marketplace throw at you.

If you deal with people’s health or wellbeing, or if they share sensitive information with you (that is, information they wouldn’t normally share outside of a relationship of trust) and you don’t have a privacy policy yet – this isn’t just a nudge. It’s an urgent reminder. Get your privacy practices sorted. Now. Not next month, not when Mercury goes direct. Now.

Why? Because the Office of the Australian Information Commissioner (OAIC) – the watchdog of all things privacy – is stepping up its game. Once upon a time, they mostly responded to complaints. Now, they’ve been given new powers to actively seeking out businesses who’ve been a little… lax. And when they find them? Well, let’s just say, the consequences are more than just a stern letter and a slap on the wrist.

Let’s talk consequences. Not to scare you (okay, maybe a little), but to give you the facts so you can make calm, informed choices. That’s what we’re all about.

Fines That Make Your Eyes Water:
If you’re found in breach of your obligations under privacy law, you could be facing fines up to $330,000 for administrative breaches. Yes, that’s a six-figure sum. Enough to buy a house deposit, but not quite as fun. If that’s not enough to make you clutch your laptop a little tighter, the OAIC can also issue $66,000 infringement notices directly. No court dates. No drawn-out drama. Just an invoice you didn’t want.

Legal Liability You Didn’t See Coming:
Do you actually know what data your website is collecting about people? If you’re using tracking pixels (hello, Facebook ads) or third-party apps, and you haven’t audited what data’s flowing in and out, you could be collecting sensitive information without proper consent. If something goes wrong, you’re not just dealing with compliance issues – you could face lawsuits. Unfortunately, the “I didn’t know” defense is not going to save you.

Reputation, Reputation, Reputation:
Trust is hard to win and easy to lose. Customers are savvier than ever about privacy. If they suspect you of shady practices because you haven’t asked them for clear consent, or they can’t figure out what’s happening with their data, they’ll walk away. Worse, they’ll tell their friends. Reputational damage is hard to fix, and in the small business world, word travels fast.

The Common Mistakes That Trip Up Even the Best of Us

No one wakes up and thinks, “Today’s the day I get in trouble with the privacy regulators.” But mistakes happen. These are the most common privacy missteps I see – none of them malicious, all of them preventable.

• Outdated Privacy Policies Gathering Dust
  Your privacy policy should reflect your current practices, not what you were doing three years ago when you copied that freebie template off the internet. If your services, software, or ways of working have changed (and whose haven’t?), it’s time for a review.
• Forgetting Who You Share Data With
  It’s easy to forget just how many systems and people handle your clients’ information. Do you use scheduling software? An email newsletter platform? A VA? An accountant? You’re responsible for knowing where data goes, how it’s used, and making sure everyone’s playing by the rules.
• Thinking Meta and Google Have Your Back
  Spoiler alert: they don’t. Yes, they have their own compliance responsibilities, but you’re responsible for your clients’ data in your business. Assuming the tech giants have it all covered is like thinking the postie will handle your refund request. They won’t. And they’re not liable if you mess it up.
• Collecting More Data Than You Actually Need
  Just because you can collect all the things doesn’t mean you should. Gathering data “just in case” or “because everyone else does” is a recipe for privacy drama. Stick to what you need to deliver your services effectively, and be crystal clear about why you’re collecting it – with yourself, and with your clients, website visitors and anyone else your business interacts with.

Once you’ve figured out what data you collect, why you collect it, and how you protect it, privacy compliance gets a whole lot less overwhelming. It’s like turning on the lights in a dark room – everything looks far less terrifying when you can see what’s going on. Same goes for cybersecurity and education yourself about what best practice means for a modern online business.

At the bottom line? It all comes down to respect. Respect for your clients’ trust. Respect for their personal boundaries. Respect for the relationship they’ve chosen to enter into with you. When you treat their information like the precious thing it is, they’ll notice. And they’ll trust you more because of it.

Plus, you’ll sleep better knowing you’ve got it handled. And what business owner doesn’t need a little more sleep?

How I can help

Convinced you need a Privacy Policy but have no idea where to start? There’s absolutely no shame in that. The good news is, I’ve got your back. There’s no need to borrow one from your favourite big brand (seriously, don’t do that) or hope ChatGPT can magically fill in the gaps (spoiler: it doesn’t know what information you collect, and a poorly drafted, generic privacy policy can be worse than having none at all).

My Contracts that Care™ Privacy Policy DIY Pack gives you everything you need to create a privacy policy that’s actually useful, actually protective, AND is actually easy to read and understand. It’s bang up to date with the latest changes to the Australian Privacy Principles and covers all the information you collect in your business – not just the stuff happening on your website. Yes, even the handwritten notes from client sessions. And the DMs. (Forgot about them, didn’t you?)

But it’s not just a fill-in-the-blanks template and a prayer. You’ll also learn why it matters and what your responsibilities are, so you walk away feeling confident, not confused.

And because no one should have to wrestle legal stuff alone, you also get a free 1-hour Accountability Action Session with me. You can pick my brain, ask all the tricky questions, and I’ll hold your hand (metaphorically, unless you live nearby). We’ll make sure your policy actually reflects your business, and I’ll support you in getting it off your to-do list and onto your website.

It’s all the benefits of a professionally drafted legal document – at a DIY price. And if DIY isn’t your vibe? You can always upgrade and have me draft it for you. Easy.

Ready? CLICK HERE and scroll down to the Website Legals section.