For many entrepreneurs considering the legal aspects of business is something hardly ever thought about. Many SME’s and entrepreneurs decide to follow a dangerous “look the other way” or “bury head in the sand” approach. This is truly unfortunate because ultimately, it is the longevity of the business that suffers.
Here is our best practice share to kick off a healthy “legal” lifetime:
Avoid a diagnostic or self-medication aided only by Dr Google
Internet research is tremendously useful to form a basic idea, or even as a starting point in the preparation of a consultation with an expert professional, but should not be consulted in isolation. The fact is that a lot of the search results are not locally relevant, up to date, or are not from reputable sources. You could end up with a proverbial self-diagnosis of polio when you just sprained a muscle. Similarly, any document or template readily available on the internet may not fit your purpose in the slightest. It may end up doing more harm than good. Ensure you download from reliable resources.
Know your risk
In my view, the most critical consideration is knowing your risks. Not guesstimating, but understanding. In other words, how safe is your business from life’s unexpected occurrences? Have you put measures in place to avoid or limit your risk most effectively?
It is critical to understand which regulations apply to or affect your business or industry and which measures should be put in place. For example, are you required to hold a trading license, if so – what are the requirements? Should it be revoked, how will that impact you?
Or have you assessed the risk posed by human capital? In other words, how do you recruit employees? What do you spend on training or integrating them into your organisation? Where is the break-even on your investment? What will you do if your investment yields no return or a loss? Will you even realise when this happens?
The concept of risk is therefore much broader than the expected risks which insurance products can address. An effective mechanism to identify, address and manage risk is therefore imperative for all businesses.
PocketAdvisor teaches users the necessary skills to identify and mitigate risk. In addition, we provide all the relevant legal structures, documents and contracts needed. For more information please contact us or enrol for one of our programs today!