Home Entrepreneurship Why Small Businesses need to Seek Legal Guidance

Why Small Businesses need to Seek Legal Guidance

by Olufisayo
Small Businesses need to Seek Legal Guidance

Starting and running a small business is exhilarating, and it’s no wonder when it allows you to turn your passion into a career.

One of the frequently overlooked foundations that a small business needs to succeed is adequate legal advice – advice that protects fair business practices and the rights of your workers. Without proper advice, it’s easy for a small business to become unstuck or become jeopardised by wrongful behaviour.

It’s important to know that there is no one-size-fits-all solution; the right expert will want to understand your business and what you plan to do with it. In many cases, a business lawyer can look ahead to proactively manage any obstacles your organisation might face or provide advice to steer you into calmer waters. If you’re still not sure whether your small business needs legal advice, here are some of the top reasons why you need a lawyer on your books:

Small Businesses need to Seek Legal Guidance

You’re starting up

A brand new business can be vulnerable if you don’t have the right elements in place – elements that are frequently forgotten by those who are turning a hobby into a fully-fledged business venture. One of the first things you need to do is understand what laws apply to your new business and whether you’re compliant. Some items you may need to consider include:

       
  • Privacy and data protection laws
  • Fair trading
  • Offering fair working conditions
  • Contracts for products and services rendered
  • Registrations for tax
  • Tax withholding

You’re selling the business

If you’re selling the business completely, or even venturing into a franchise model with your business, you need advice on how to properly value and pass on your brand.

Franchising offers potential to have your coveted brand spring up all over the country and give you greater leverage with your own suppliers with increased buying power. However, with increased autonomy, you also need to create safeguards and contractual conditions so consistency of products, services and safety are maintained.

If you’re selling the business, your legal adviser will be able to prepare the business and its assets for handover. Not only will this streamline the process for potential buyers, it will also negate any last minute challenges that may derail a successful sale.

You’re being sued

One of the most harrowing anxieties for a small business owner and operator is the risk of commercial litigation.

Ethical business owners want to do the right thing by their customers, suppliers and workers, but there are occasions when a simple mistake can breach basic agreements. To protect your business, livelihood and people, you should engage with your lawyer at the earliest convenience. Not only will your lawyer be able to understand the complaint, they can investigate the legibility of the complaint and advise on cost and time-effective strategies to get you back into your day-to-day routine.

       

You’re landing a substantial contract

There are few things that feel better in business than landing a substantial contract with a customer – this is why small business owners work the crazy hours they do!

A large contract often places a new level of stress on a business; small business operators often experience tighter turn-around times, higher KPIs and even greater staffing demands, that many are not accustomed to.

Sadly, in some complex contacts, there are hidden and unfair clauses that can bankrupt even the most prepared business if a certain criterion isn’t met. This can have a domino effect as wages, bills and suppliers still need to be paid for the work they have completed on what could be a void contract.

To protect your business and ensure your contract remains fair and in place, your business law expert will comb through the unsigned agreement to check for any issues, and offer advice if you need to renegotiate.

Your debtor is not paying you

Contracts between debtors and creditors are a huge part of a successful business relationship, but if you find that a debtor is not paying your bills you need to take a number of proactive steps to protect your business and finances.

       

Spiralling costs can bankrupt your business and make your personal assets vulnerable to others. Goodwill is not enough to make sure you can keep your doors open.

Your business lawyer can:

  • Draw up clear business contracts that outlines the agreement and repercussions of a breach
  • Execute a number of cost-effective steps, like legal letters, to encourage bill settlement before being required to organise court hearings
  • Prompt non-responsive debtors to debt collection
  • Cancel contracts to free your business to pursue other contracts
  • Place caveats on the debtor should they try to avoid bill payment by selling their assets
  • Represent you and your business in court should the matter be referred

You’re expanding the workforce

When you get to a point where you need to expand your workforce to keep up with customer demands, then you need proper legal advice.

Your lawyer will be able to explain the different sorts of employment that you can explore to fit best with your business:

  • Contract: Great for businesses that need flexible expertise, contractors can be essential for your business. Contractors often demand higher fees as they often forgo employment benefits, but also outfit themselves to be representatives of your brand.
  • Casual: If you have seasonal or peak operations, casual employees can provide flexibility and capacity to make sure customer needs are met in short timeframes – however, there can be some special caveats you need to be aware of.
  • Part-time and full-time: Depending on your employee and workplace needs, part-time and full-time employment offerings are still the most popular options for building business loyalty. When scaling up, many small businesses look for part-time assistance until they are able meet the next threshold and offer full-time hours. Similarly, if your workers need flexibility for personal, family or study needs, offering part-time employment secures a great worker on a schedule that works best for both of you.

The above highlights the benefits of utilising good legal practice and advice within your business, no matter where your business is based you will be able to find legal advice to suit your business requirements.

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