How to protect your business
Moving from the legal abuse you and your business may take to ways of protecting your company and assets.
After writing the stories of this Oregon dealer, this Missouri dealer, and this California landscaper I have found some of the things you can do to prevent similar situations from occurring.
Planning
It really starts with prior planning. The old scout addage, “always be prepared,” is extremely appropriate when it comes to law. From the formation of your business to business contracts to your exit strategy, planning these events with an attorney and accountant long before they occur will go a long way to resolving any issues that may come up.
Counsel
I wrote about the importance of having your banker as part of your management guidance team. It is equally important to have an attorney on that team.
Your attorney(s) can help you with the business formation, contract reviews, collections, and ultimately court representation. The idea is to create internal systems that prevent errors by the business owner(s) or employees from dissolving the business.
Insurance
Business liability insurance, while not an attorney, is the protection from total financial ruin. You should still consult with your attorney when deciding on an asset protection plan, but your insurance coverage should protect your business and personal assets. The fact-of-the-matter is that small businesses won’t have the teams of attorneys looking out for their best interests that big corporations have. Small businesses will have a distinct disadvantage in the world of commerce that leaves them exposed to risks that may be completely out of their control.
This is where your business insurance will come into play. If your business is held liable in an event, than your insurance (if structured properly) will step in and control that debt burden allowing you to move on and continue.
These are just a few of the things you should be considering in order to protect your company and assets. I will continue to write about this topic in the coming week as there are still a number of things to think about, utilize, and protect against.
