How to Save Money on Small Business Legal Fees
Paying legal fees sucks.
It’s as desirable as paying taxes. Unfortunately, as a business owner, you will have to do it sooner or later. Either you can manage the legal side of your business ahead of time and anticipate potential problems, or you can do it after the problems occur. Far too many small business owners wait until something goes wrong, which always costs more in money, time and headaches then dealing with the legal issues up front.
Taking care of your businesses legal needs does more than protect you from enormous tax bills, business disputes and loss of revenue and assets (such as intellectual property). Handling your legal needs also means that:
you get taken seriously by clients and partners,
you get paid on time,
you are poised to take advantage of new opportunities, such as joint ventures, and
you can put your intellectual property to work foryou.
Now that you know you need to take care of the legal side of your business, you may be wondering where to begin. Here are some things that you’ll want to get around to dealing with in the (very) near future to make your business legal…
Form the Right Business Entity for Your Business
Whether or not you’ve formally formed a business entity, you do have one. Sole proprietorships spring into being, without filing any legal documents, the moment you start selling something. Partnerships also launch when one or more persons begin working on a business together. There are a myriad of pluses and minuses attached to each business entity — which may include increased or lowered taxes, shielding of your personal assets (such as your home, bank accounts, etc.) from creditors, and even your partner’s ability to acquire debt for which you will be responsible. You don’t want to form a (Pty) Limited or continue to operate as a sole proprietor just because it’s easy.
Legal Fee Saving Tip: Even if you decide to form the business yourself, consult with an attorney and accountant to determine which entity is the best fit for your business.
Contracts and Our Rule of Thumb
Here’s our rule of thumb that will protect your business from losing money, time and productive energy: Have a contract for every single relationship your business enters into. Make sure you customize your contracts to actually fit your business.
Legal Fee Saving Tip: You can have an attorney draft the types of contracts you’ll need to use often — such as your Standard Service Agreement and Independent Contractor Agreement — and then use them over and over with the different clients and contractors you work with.
Protect Your Intellectual Property
Would you be horrified to discover another business that does what your business does — and is using a logo, name or slogan that is dangerously similar to (or exactly the same as) yours? If so, you’ll want to protect your brand and the “good will” that goes along with it by registering trademarks for your business name, logo and slogan. This involves filing a trademark application with the Trade Marks Office (CIPC). Once your trademark is established, you’ll want to monitor your mark to ensure that unauthorised persons are not using it by setting up a Google Alert, and through the use of non-disclosure and licensing agreements. If you don’t prevent others from using your trademark, you could lose it.
Likewise, be sure to protect your creative works of authorship — such as your information products and other original work. You can do this by posting a copyright notice on your original work so that anyone who interacts with it is notified that they cannot copy it or otherwise misuse it.
Legal Fee Saving Tip: Conduct a trademark search prior to filing your trademark applications so you don’t wind up filing an application that is not likely to be granted. Also, when working with an attorney, you may be able to obtain a volume discount on the legal fees if you file your various IP applications at once.
Keeping Your Website Legal
Using he internet to build a business may seem really straightforward, but there are crtain requirements that websites need to follow in order to comply with consumer laws, and to avoid disputes. You may also want to create Terms of Use for your website, particularly if you sell products or services from it. Terms of Use can cover a wide variety of topics; some examples include:
your right to use information posted by visitors on your site,
whether and how your intellectual property posted on the site may be used by visitors,
payment terms,
warranties and liabilities waived,
account management,
site security,
jurisdiction for any lawsuits arising from their useof your site, etc.
Additionally, you want to be sure not to infringe on anyone else’s intellectual property, and disclose your affiliate marketing relationships.
Legal Fee Saving Tip: Privacy Policies and Terms of Use are not cookie cutter. They depend on how the business is operated, third party services used to conduct business and what is being sold. Instead of stealing someone else’s privacy policy and terms of use, draft them yourself and then hire a lawyer to review it for you. The review will be less expensive then drafting the policies from scratch, and the lawyer will point out any holes or pitfalls.
Now, I know we have just added a myriad of complex things to your To-Do list — but you’ll sleep better knowing you’ve covered your tail. And with the advent of lawyers operating Online Law Offices, taking care of your legal needs has never been more accessible or cost effective. So hire an attorney and “get it done”, so you can get back to doing what you do best!