Millions of people across the United States own or help run small businesses. It’s been said so often that it sometimes sounds like a cliché, but small business truly is the engine that runs the American economy. Small business owners tend to be idea people, risk takers, and those not afraid to forge ahead even when many would turn away from a challenge. There’s something to be admired about that mindset, but unfortunately it can also leave many small businesses vulnerable if owners don’t stop to get advice from time to time. Owners and managers need small business legal services, and according to a 2013 study conducted by LegalShield, not enough of them are obtaining it.
The study The Legal Needs of Small Business revealed several statistics that would likely startle many business owners. Examples include:
- Nearly 60 percent of all small businesses in the United States experienced “significant legal events” during the two years prior to this study.
- Debt collection was the most common reason, as 22 percent of small business respondents stated they had experienced trouble getting paid by a customer.
- 20 percent stated that they needed contracts reviewed.
- Nearly 10 percent had to deal with contractor or supplier disputes, online security breaches and other problems.
One of the most troubling findings of this study was that of the 13 million small businesses that experienced significant legal events in the prior two years, nearly 60 percent of them did not hire a small business attorney to help them. That means there were several million legal matters during this time period where owners did not obtain small business legal services.
Simply put, too many owners and managers are taking enormous risks by not obtaining small business legal services. An attorney can not only help business owners navigate through legal problems, but he or she can help prevent those problems from ever arising in the first place. Below are just 5 examples of small business legal services that benefit owners and managers across the United States.
1. The Foundation Builder
Anyone who has started a small business understands that there is a lot that needs to be done before that business ever opens its doors. A few examples include:
- Choosing an Entity – There are several different types of business entities in California. Choosing the correct entity can make all the difference in terms of potential legal liability on a personal level and potential tax liability.
- Documents – Every business will need to have a library of documents ready in order to operate efficiently. Examples of these include contract templates and invoice templates.
- Financing – Most small businesses engage in some sort of financing, and any financing agreement needs to be reviewed carefully before agreements are signed and funds disbursed.
- Policies – If a business is going to have workers, it will need policies in place in order to provide for a proper working environment and in order to protect the business from potential liability.
Small business legal services can help build the foundation of a new business, and an attorney should be present to help complete these steps from the outset.
2. The Protector
Every small business needs someone in place to help protect that business, as there are a number of challenges and problems that can arise at any given time. Many of these challenges are outside the control of that small business owner or manager, but need to be handled with a sense of urgency. Some examples of these potential challenges include:
- Customers failing to pay invoices
- Actions that require a written response
- Dealing with intense conflicts between workers
Engaging an attorney to provide small business legal services will help protect that company from harm before it arises or before it gets worse.
3. The Growth Manager
If your business starts to take off, you’ll find yourself in a very exciting place, but also one that requires focused management. A large number of businesses are harmed or even ultimately fail because they did not manage their growth properly. Small business legal services can help owners and managers deal with the following situations that often relate to growth, among others:
- The attachment of state and federal jurisdiction in terms of relevant laws as the number of employees reaches a certain threshold
- Defining and continuing to oversee the difference between employees and independent contractors
- Negotiating new leases as companies encounter the need for more and/or larger office spaces
- Adding/changing ownership structure as the business continues to grow and diversify
All of these scenarios and will be made simpler if a small business attorney is involved. That attorney will help owners and managers take the correct steps and avoid mistakes that could be incredibly costly, both in terms of the balance sheet and in other ways.
4. The Fighter
Despite every measure of preventative legal care that exists, there will still likely come times when a small business needs to dig in and fight for its rights. This is where a small business attorney’s role becomes critically important. A few ways in which fights can arise and become necessary for a business include:
- A customer requests or even demands an improper refund.
- A customer refuses to pay an invoice for an extended period of time.
- A contract turns sour, leading to the need to negotiate a resolution.
- A creditor becomes unreasonable, necessitating legal push-back.
- A situation breaks down to the point where litigation is initiated.
Defending a small business’ rights is in many ways similar to defending a person’s rights. Small business legal services can and often do include fighting for a client, as there are times when there is no alternative.
5. The Advisor
One of the many reasons that running a small business is so engaging and fun is because every day, it seems like something happens that provides a new way of looking at or even doing things. While innovation has always been the backbone of small business, new ideas and approaches also need to be properly evaluated so that an owner and/or manager does not encounter problems unexpectedly. Examples of how small business legal services involve serving as an advisor include:
- Reviewing new policies meant for employees or contractors
- Providing input on ideas involving the marketing of products or services
- Helping management understand the ramifications of certain personnel decisions
- Offering legal advice regarding a potential new partnership with another company
The ways in which a small business attorney can serve as an advisor are nearly limitless in number, but that’s all the more reason to have an attorney working with a small business: He or she needs to have an innate understanding of that operation so that decisions can be made quickly and with a foundation of knowledge.
How Kam Law Firm Can Help
Running a small business is an ongoing challenge that often brings out the best in those accepting and/or embracing that mission. However, certain situations are going to arise that can either be dealt with quickly, efficiently and legally or they can devolve into serious problems that require weeks of focus if not more. The best way to avoid these unnecessary problems and to make sure that you get to continue to do what you not only want to do, but what you do best, is to make sure that you have an attorney providing you with small business legal services that keep you out of trouble.
Kam Law Firm represents businesses all over San Diego County, and the firm understands what it takes to help clients move towards their goals as quickly as possible. If you’d like to learn more about how Kam Law Firm can help you, contact us today to schedule a complimentary initial consultation so that you can evaluate how small business legal services can help you.