According to Reuters, small businesses are expecting continued growth in 2017 and beyond. While we are continuing to see growth in small business ownership, many emerging and existing entrepreneurs fail to protect their business when it comes to unforeseen and unplanned events that require legal representation (see related article, LegalZoom CEO Sees Quality Legal Advice as a Necessary Evil).
Darnell Self, a 19-year corporate executive with LegalShield, whose primarily responsible for on boarding, training, and leading a peak-performing sales force in the US and Canada. Darnell has witnessed several small businesses who have succumb to various life events because of the lack of access to an attorney.
For the typical small business owner, cash flow is one of the largest concerns. Many tend to assume subconsciously that their need for a lawyer is highly unlikely. It's readily adopting the old, "oh, that will never happen to me or my business" adage. "We've researched this for years and have found that most small business owners spend an unplanned $3,000 or more on legal expenses. Legal plans help set a predictable spend, often at less than 1/3 of that cost, with the ability to proactively manage their business," according to Darnell.
When it Comes to Legal Matters, Ignorance Is Not Bliss
Skilled lawyers can play a critical role in helping a business owner be proactive in protecting the assets of the business, whether it is the legal structure of the business (i.e. S-Corp, LLC, etc.), contacts with suppliers and vendors, employee arrangements (i. e. employee handbooks, compliance matters, etc.) and even assistance in accounts receivable as it relates to debt collection.
Darnell reveals five (5) benefits of how entrepreneurs can position their small business to be legally protected:
Consultation on Business Matters: members can contact their attorney to get guidance on how to approach business matters, many of which have direct or indirect legal implications. Establishing The Correct Legal Entity: new business owners often need advice on how to establish their business entity. Contract Reviews: businesses deal with a lot of contracts and should have a lawyer review such contracts. For example, the author of the contract writes that contract in his/her favor. Therefore, having an attorney review all contracts before signing is most advantageous to you and your business. IRS Audit Defense: lawyers can assist with an IRS audit, ensuring the business owner understands their rights and are properly guided through the process. Debt Collection Letters: businesses that deal with billing clients and accounts receivable inevitably will encounter situations where clients may pay late. These can become very challenging and could result in the client not paying at all. Using a collection agency (that snatches a portion of the amount collected off the top), can become an unplanned, burdensome expense for the small business owner. Calls or letters from lawyers can get higher favorable responses and make significant progress on relevant matters on your behalf.
Darnell believes that it's critical to position and manage every small business proactively. If you haven't already, start to put in place the right team of experts and professionals to support your service vision and mission, including smart, sensible and affordable legal representation as a critical staple on your team to help protect your assets.