After years of working for other people, you are now ready to form your own company. You’ve identified a gap in the market and you have the product or service and experience to fill this space.
Forming your own company can be very exciting, but there are also challenges that you’ll need to overcome. One process that shouldn’t be overlooked involves working to address the legal aspects of your new business. Outlined below are a few things to keep in mind.
What structure will your company take?
Some small businesses are set up as sole proprietorships. The benefit of this is that your endeavor can essentially start operating immediately. The downside is that you will also be personally liable for any debts or claims against the company. For this reason, many business owners opt to set up a Limited Liability Company (LLC). Doing this better ensures that your personal assets are shielded from any liability incurred by the company.
Contractual agreements
There are very few companies that are operated by one person. Generally, employees and business partners also play key roles. Even if everyone on the team is trustworthy, it’s crucial that all business relationships are backed up with contracts. Employment contracts and partnership agreements ensure that all parties know exactly what is expected from them.
It’s also important to ensure that customer relationships are backed up with contractual agreements. This way, customers knows that they will receive the product or service they have been offered and you will be paid the agreed price on time.
Setting up a new company involves a lot of time and effort. Seeking legal guidance will help to ensure that your interests – and those of your new business – are protected as you move forward.