Top entrepreneurs understand that finding the right attorney is a complex and sometimes vital aspect of running a successful small business. From dealing with complex legal issues – such as contracts, intellectual property and employment law – to ensuring all laws and regulations are followed, seeking advice from a trusted attorney can provide business owners with the peace of mind they need to focus on growth and profitability. .
But with so many different types of lawyers and services available, how can entrepreneurs ensure they are making the right choice? What are some common legal services that entrepreneurs need? And what are the best practices small business owners should follow when it comes to their company’s legal requirements?
To answer these questions, Trend turned to Chattanooga Chamber members Grant, Konvalinka and Harrison, PC — a local law firm serving Chattanooga businesses for more than 50 years.
Presented by Michael A. Holmes and David M. Elliott, the experts at Grant, Konvalinka, and Harrison, provides top small business legal advice.
Design contracts with the business in mind
Well-written contracts help business owners clarify expectations and protect legal interests when launching a business. Creating standard forms and agreements helps companies control relationships with suppliers, customers, and employees. Lawyers can help anticipate the problems that may arise if a dispute occurs with any of these relationships.
Consider using contracts to provide clarity on your most important transactions such as scope of work, terms of payment and termination rights. Best practice is to regularly review and update contracts to ensure they remain relevant and enforceable.
Periodically reviewing and updating contracts is especially important when companies undergo change or expansion – whether that’s expanding into new markets, adding products or services, or hiring new employees and contractors.
Create, maintain and update exit strategy
An exit strategy is a plan that defines the rights and responsibilities of business owners upon desired retirement, disability, death, or liquidation event.
This aspect becomes especially crucial when dealing with multiple owners. While you may enjoy running your business alongside your chosen business partner, you may not feel the same about his family, heirs, or estate.
Common exit strategies include restricting the transfer of stock shares, transferring those interests to a partner or family member, selling the business to a third party, or simply winding up and cashing out.
We recommend that you address exit strategy considerations initially in the operating agreement, shareholder agreement, or other governing documents.
Attorneys help address estate and tax planning concerns and implement their desire to reward valuable employees when they exit their business.
Protect intellectual property, including trademarks, copyrights, and trade secrets
A valuable asset for most businesses, it is important to protect intellectual property such as names and trademarks through the registration of trademarks and domain names.
While there are some common law rights to words, logos, images, letters, shapes, or any combination thereof, companies can obtain increased protection by registering a federal or state mark—a trademark for goods, or a service mark for services.
The registration provides an exclusive right to use your mark in connection with the goods and services specified in your application, which the courts will generally enforce against infringement or misuse.
Determine the availability of a new mark or brand early in its creation process to avoid committing to a mark that may already be in use.
Original creative works, including literary works, computer software, and guides, must be marked with a copyright notice and copyright applications must be submitted promptly to the US Copyright Office for increased protection.
We also recommend the use of non-disclosure and non-compete agreements to protect trade secrets and proprietary information. These agreements must be enforced by anyone who has access to your sensitive information.
Building accounting relationships
While some business owners are often tempted to manage their finances on their own, this approach can lead to costly mistakes and missed opportunities.
An experienced accountant can provide valuable advice on tax planning — such as maximizing deductions and ensuring compliance with state and federal guidelines.
Accountants provide tax services that provide immediate value to companies by implementing effective tax planning strategies, which help companies avoid penalties and audits.
Be sure to consult a certified public accountant who can learn about your business during and after tax season. Accountants can also help you manage finances more efficiently by creating financial forecasts, setting budgets, and monitoring financial performance.
Risk protection and mitigation through insurance coverage
Risk coverage and insurance should be carefully considered when operating a business.
While it is impossible to completely eliminate or insure against all risks, carefully considering the types and amounts of insurance coverage needed to properly protect your business is vital.
The risk profile of many companies today is getting more and more complex. Relying on purchasing minimum liability coverage requirements, property insurance, and state employee compensation may not be sufficient.
Today’s business owners need to consider a variety of different coverages, including cyber liability, professional liability, employee liability, crime and blanket policies. They should also be mindful of the amount of coverage being purchased and pay attention to the fine print in policies—particularly terminology related to claim reporting and exclusions.
Consider a trusted insurance agent to help navigate and process your coverage options.
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