5 minute read
3 common legal mistakes small business owners make and how to avoid them
The day to day running of a small business is time consuming enough without having to worry about the small print and staying on top of updates. Below is advice covering three common situations affecting businesses (including franchisees) and how to handle them.
- Not taking care of the small print
It may be called ‘small’ print, but not paying attention to the exact terms and conditions set out in shareholder agreements, service and supplier contracts can cause big problems further down the line. All agreements and contracts must be fit for purpose for short and potentially long term obligations, so it is important to for franchisees to understand what it is they are agreeing to. Having a legal expert draft or review contract terms can hugely improve the prospects of a business and strengthen its position.
2. Ignoring emerging technology
We are fortunate enough (or unfortunate enough, depending on your point of view!) to be experiencing a period of unprecedented change. Technological developments are accelerating at such a pace that some businesses are struggling to keep up. Keeping on top of emerging technology is one thing, but understanding the potential impact on your business might be the difference between staying ahead and falling behind the competition in the market. In particular, the next five or so years are predicted to see artificial intelligence (AI) and machine learning gathering pace. This and other new technology creates opportunities for businesses to provide faster and ultimately more cost effective services.
3. Avoid terminating a business contract without legal advice
Fiona Blakeborough, a dispute resolution specialist recommends avoiding terminating a business contract without first seeking legal advice. For example, if a franchisee was to wrongfully terminate a contract, they could find themselves in serious hot water as the terminated party would be entitled to pursue damages. This would be an added and unnecessary expense that could grossly impact on the success of your business. A quick call to review your situation might cost £100 compared to a potential fee of £30K+ if a dispute leads to litigation. An experienced solicitor will advise on dispute resolution options to help secure reasonable settlements and avoid costly blowouts.