April 20, 2021

How to Know If Your Small Business Needs an Attorney

It takes a lot of different skill sets to keep a small business running. As a small business owner or entrepreneur you’re probably used to wearing a few different hats and overseeing things such as production, marketing, customer service, and so on. But even though you can do things, doesn’t always mean that it’s in your best interest to do so. One such expert might be an attorney. But when might you need one and how do you go about hiring the right one? We’re sharing some of the when’s and how to’s below.

When To Know if You Can Do it Yourself or Should Hire an Attorney

We’ll cut right to the chase. Doing it yourself often saves you money and that’s important for a small business owner – every dollar counts. Here’s our short list as to when you can do it yourself compared to when you might consider hiring an attorney:

When You Could DIY It

writing a business plan
filing for a business license and deciding on a business entity
reserving a domain for your website
applying for an EIN for tax purposes
applying for licenses & permits
creating contracts for use with customers, clients or vendors
creating a buy-sell agreement with partners
updating any partnership or shareholder’s agreements under which you are currently working
handling audits by the IRS

It’s important to note that these items are things you could potentially take care of yourself, but that you could also hire any reputable attorney to take care of for you. Remember, just because you can do it, doesn’t mean that’s always the best option. When in doubt, seek expert advice before deciding to DIY it.

When To Hire an Attorney

former, current or prospective employees sue for wrongful termination or a hostile work environment
state or federal investigations of your business because of claims of law violations
negotiating the sale of your company or an acquisition of another entity or it’s assets

What You Should Be Looking for When Hiring an Attorney

Not all attorneys are created equal. Yes, they should all have a reputable law degree but just like doctors they specialize in a variety of areas. Making sure you understand what types there are to choose from and which you need for your particular concern is a great place to start. When looking for an attorney to help you with your business, you’ll want to find as many abilities as you can in the same person. Here are a few specialties that might come in handy:

contracts – this comes in handy if you’re hiring employees, setting up contracts with suppliers and so on.
business organizations – if you’re not sure what type of business entity you should be setting up, an attorney is a great person to ask. They’re also able to prepare the necessary paperwork.
real estate – this may not be an essential if you’re an online business but it might be if you’re looking to lease commercial space or build and run a brick and mortar store.
taxes & licenses – yes, an accountant will file your taxes annually, but you’ll need an attorney to help you get the proper licenses and they should also understand the more basic legalities that come with basic business transactions, etc.
intellectual property – if you’re creating new products or work in a creative field it’s important that your attorney understand how to register for trademarks and copyrights or at least know a specialist that can help if needed.

Once you’ve got the specialties down, you’ll need to also consider the following:

Communication is Key

JP Morgan once said, “I do not pay my lawyers to tell me what I cannot do, but to tell me how to do what I want to do.” A good attorney will outline your options, keep you posted on potential outcomes and make sure you stay above the law and out of any harmful legal action. Make sure that the attorney you hire is wiling to give you more than just “don’t do that” or “I’ll take care of it”. This is your business after all, they’re there to advise and that means they’ll need to use more than just a few brief sentences to keep you informed.

Location is Convenient

It goes without saying that keeping things close to home is always a good rule of thumb. Sure, there may be legal counsel that is highly acclaimed in a big city, but if it’s difficult to get there or even set up a time to meet, the odds are you won’t do it unless it’s absolutely necessary. Picking an attorney that is closer to home means they’re invested because you’re a client that isn’t going to be infrequent and you’ll also be a great referral to others in the area if they accommodate your needs well. Besides, usually things are dicey or complex when you need an attorney – so it’s best to make the process of meeting with them as simple, an time efficient as possible.

Trust Your Gut

It’s not always important that those you work with are your best friends, but it is important that you trust your gut feel with those that you hire to represent your business and give legal advice. If you get a funny feeling that the attorney you’re meeting with isn’t going to be a good fit – keep looking. This individual is going to need to be a good communicator, they’re going to have to understand your business and get along with you. Just because their legal advice comes with a great referral or at the right price doesn’t always mean it’s a good fit. Legal stuff is hard to deal with – so you’ll need to be comfortable with the person that you’re going to ask the hard questions to. You’ll also need to be ready to hear the tough stuff from your attorney as well, so be sure it’s someone that you can trust.

FAQs:

1. When should I consider hiring an attorney for my small business?

You should consider hiring an attorney for matters like employee disputes, investigations, or business sales and acquisitions.

2. What are the key tasks I could potentially handle myself as a small business owner?

Tasks like writing a business plan, filing for licenses, creating contracts, and handling IRS audits could be handled by yourself or an attorney.

3. What specialties should I look for when hiring an attorney for my business?

Look for attorneys specializing in contracts, business organizations, real estate, taxes and licenses, and intellectual property.

4. What role does communication play in choosing the right attorney for my business?

Communication is crucial. Ensure your attorney communicates clearly, provides options, and keeps you informed about potential outcomes.

5. How important is it to trust my instincts when hiring an attorney?

Trusting your instincts is vital. Your attorney should be someone you trust, communicate well with, and feel comfortable discussing tough issues with.

What is an Overhead Expense?

We work with small business owners and entrepreneurs. Some are seasoned, others are just growing their side hustle. Their skills are varied and they have a wide variety of talents. We often get asked to explain the ins and outs of financial reports and have found that providing our favorite clients with a working knowledge of accounting terms is helpful. With that end in mind, we’re sharing that expert knowledge with you. So if you’re looking to get a better grasp on your small business books, want to understand your financial reports so you can make better business decisions, or even are just starting out and want to do it right… you can check out our word of the week and start expanding your working financial knowledge.

What Is An Overhead Expense?

First things first. If you’re wanting to know more about your business expenses we have to start at the beginning. You can read more about Expenses here. An overhead expense is one of two types of business expenses and includes the costs of running your business. These costs could include but aren’t limited to rent, utilities, employee wages and more. These type of costs ARE NOT related to the COGS but instead are things that do not generate revenue. Overhead expenses are costs that have to be paid even if business is slow and a smart business owner keeps some cash to fulfill these obligations just in case there’s a month or two that go by where profits might not be what they’d like.

How Does Knowing Your Overhead Expenses Help?

Knowing your overhead costs can help you set your prices for the products you sell or the services you render so that you’ll end up with profits. Factoring in the overhead will show you just how much money your business needs to bring in so you can stay afloat or even grow. You can also use your overhead expenses to help you figure out your net profit or bottom line. Knowing what you’re spending on overhead expenses can be the first step in strategizing a way to bring those costs down. Simply reducing the amount you put towards overhead expenses can increase your net profit.

Frequently Asked Questions

1: What is an Overhead Expense?

Overhead expenses are the ongoing costs of operating your business, such as rent, utilities, and employee wages. These expenses are not directly tied to generating revenue (unlike the cost of goods sold or COGS) and must be paid even when business is slow.

2: How Can Understanding Overhead Expenses Benefit My Business?

Understanding your overhead expenses helps you set appropriate prices for your products or services, ensuring you cover costs and make a profit. It also allows you to better calculate your net profit and strategize ways to reduce expenses, ultimately boosting your bottom line.

3: Why Should I Track Overhead Expenses Regularly?

Tracking overhead expenses regularly gives you a clearer picture of your financial obligations, helping you manage cash flow more effectively. It also helps you plan for periods of lower profits, ensuring you have enough cash on hand to cover these essential business costs.

How to Grow your Business: Marketing Strategy Part II

Once you’ve ironed out your marketing message, you’ll want to decide what channels will work best to get your message to the right customers. As you consider each channel, think about where your audience “hangs out”. Does your audience spend a lot of time on social media? Does your audience read the newspaper or listen to the radio? Focus your marketing efforts on the channels that are most likely to grab your audience’s attention.

That being said, you’ll want to be careful not to put your eggs all in one basket. Explore different marketing channels and consider how each will impact your business.

Here are some popular marketing channels and some tips for using each one:

Email

Email is a cost effective way to reach lots of people. When setting up an email campaign, you’ll want to make sure your emails won’t get marked as spam. Then, as your craft the emails, think about these three things:

Am I reaching out to the right person?
Does my email provide value?
What am I trying to get this person to do?

Come up with a subject line and pre-header that will persuade them to open the email, but doesn’t feel like click bait.

Print

Print can be useful in establishing your brand offline and reaching customers outside of the internet. Determine where your audience is most likely to see your ad. Is it in a magazine? A flyer in a coffee shop window? A brochure at a hotel? Create your print ads to be visual, clear, and concise.

Direct Mail

Direct mail can be a great channel because it’s usually very targeted. In order to track how your direct mail campaign goes, I suggest using a specific promo code or website link printed on your mailers. This will help you to more accurately track sales from this channel.

Social Media

I’m referring to social media as the organic (free) posts that companies put on their accounts. Social media can be very helpful once you have a good following, but until then you’ll want to try to grow your follower by using engaging and shareable content along with popular hashtags. Don’t forget to stay on brand with all your posts!

Digital Ads

Digital ads include all paid online ads. Some examples include Google search, Facebook display, Instagram ads, Instagram story ads, Google display ads, LinkedIn ads, Pinterest ads, etc. These types of ads allow you to get really specific with the audiences and keywords you’d like to target. Digital ads are also easy to start, stop, and change within seconds if you need to course correct. You also have the ability to A/B test images, wording, and other content to see what your audience responds too.

Billboard

Billboards can be a daunting channel because they are expensive. With billboards, you’ll want to be as visual and concise as possible. Remember, people could be driving past your billboard at 60+ mph. When working with the billboard company, be sure to find out the exact dimensions and resolution for the file they’ll need. Digital billboard can also be a great channel to look into as they are typically less expensive and easier to change if needed.

Think about where your audience is most likely going to be spending their time and start with those channels. Do tests, try different messaging, and see what data you can pull. Once you have an idea of what channels will be best for your business, you can start to grow your marketing strategy even more.

Resources

Day: April 20, 2021