Starting a new venture is both exciting and daunting at the same time. Being fully prepared in all senses of the word is paramount to the success of your business. Getting everything right legally is crucial, so here are a few areas to consider from the outset.
- Before you even open a business account and get the ball rolling legally, make sure you have enough money to start. Save as much as you can, preferably enough to get you through the first year of trading. Relying solely on a business loan that has to be repaid with immediate effect will put the pressure on straight away, it can take months or even years to actually turn a profit and releasing equity from your home or using a credit card could put your property and credit rating at risk.
- If you don’t need to rent a premises, then don’t. Use any available space at home to begin with. This will ensure that you have the capability of running your own business, if any mistakes are made, you should be able to recover from them more quickly without onerous overheads to worry about.
- Take out business liability insurance, this will cover you against any damages that may be bought against you, for example, potential law suits, bad debt and any other issues. It will protect your personal assets such as your car or home.
- Make sure that you understand every cost involved in starting a business; inventory, rent, wages, equipment etc. Overheads add up so it’s essential to understand every detail of the business and know your break even. All of this can be incorporated into a business plan.
- A coherent business plan will determine all of these costs, as well as the marketing strategy and how it needs to be put into place. It’s a great document that can be continually referred too, it will indicate how well and how quickly you have progressed as well as suggest any changes that you may need to make to further the success of the company.
- Try and keep a competitive edge such as superb customer service, pricing, distribution techniques or better locations than your rivals.
- Make sure that all agreements that are made are put in writing, understanding what the law requires is essential to the existence of any business. Verbal agreements can be very difficult to prove and if a problem were to occur having something on paper will only benefit you. Leases, rentals, contracts for services, purchase orders, letters of employment and employee policies should all be logged.
- Create and maintain a happy workforce, this will create purpose, loyalty and stimulate productivity which in turn will make your business, whatever its size, more profitable.
- The legal status of your workforce is very important, get signed contracts that stipulate hours, policies, pay and whether the job is temporary or permanent.
- Consult a lawyer for any business issues you may have, making sure that you have covered every legal base is essential to the success of your business. Understanding the law and the parameters within which you, your employees and how the business is structured will enhance its reputation and longevity.
By Harry Price
Harry Price is a a writer living on the south coast. In his spare time, among many things, he loves to paint landscape picture inspired by his picturesque surroundings.