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Tips for Protecting Your Business Assets

Protecting your business legally
Protecting your business in the modern digital age

1. Be Careful and Consistent in Your Business Communications

We live in a time where we are communicating all the time – during work hours, on the weekend, by email, telephone, mail, social media, blogs and in person. Having a consistent brand image is important. This also includes avoiding making public announcements when your business is not ready or you have not done your due diligence in the subject. You will also want to avoid working with anyone of questionable or unscrupulous nature. Some businesses make the mistake of assuming that since they have a stellar reputation, it is okay if their clients or customer do not. However, this can turn out to have a very negative impact on your company if that customer or client does something unethical and your business gets tied to it.

In carefully considering your communication approach, you will also want to bear in mind any possible conflicts of interest. This can happen between existing and new clients or other situations you face. It is important that you have thought these aspects through and addressed them before getting into any business arrangement with any individual or company or you might find yourself in court or a bitter legal battle. Take the time to be informed. You will be thankful you did in the long term and enjoy greater peace of mind.

2. Hire a Competent Attorney

When you first start out, it can be hard to afford a good lawyer as some of the better lawyers do charge more. However, you need to have legal services for your initial contracts and also to help you if necessary with specific state requirements, HR, taxes, litigation or any other concern you might have.

Search around before you commit to a lawyer. Ask and get referrals. Talk to potential lawyers before you sign on to make sure you are comfortable with them and confident in their abilities and know what agreement you are signing with them for their services.

3. Separate Yourself From Your Business

When you run your business as a sole proprietor, you have less things to think about initially which may seem great. However, you are liable for all costs for the business including any lawsuits whether they are fair or not. This puts you at great risk, where your car or home could be seized in a lawsuit that you lost.

Avoid this scenario by protecting your business as well as your personal assets. You can do this by setting up an LLC or S corp where you separate your company’s finances from your own. You can also set up a trust, a legal entity that files its own tax return and can own property, businesses, cash, securities and a host of other assets. If a business is owned by a trust, only assets owned by that trust can be sued in a lawsuit.

4. Insure Yourself

All businesses should get liability insurance in case to protect against unforeseen events such as a customer slipping and falling in your place of business. You may also

want to get errors and omissions coverage if you have a services or consulting business to protect against a customer or client claiming that he or she did not receive exactly what was required by contract. If your business is large, you may also want to have

directors and officers liability (D&O) insurance. This insurance protects the directors’ personal assets in a larger suit against the company.

You also want to think about protection within your own contracts so you are protected against unexpected events (your supplier did not provide materials or there was a delay due to weather conditions) so that you are not held liable for these changes. You will want legal help to make sure you are clear on your work contracts and use the right language and clauses.

5. Protecting Your Business Files

You must have a system to protect your files. Today every business is online practically so you have to keep a way of backing up your files such as hard drives and also online storage. You may want to keep a print and hard copy of files in a different secure location. Think about other aspects you may need to have such as a generator or extra phones or alternative work sites. Planning ahead for any emergency or disaster will help keep your business safe and proactive.

By doing these steps and being proactive about your company’s well being and safeguarding your assets, you will be able to protect yourself and your company in the event of a lawsuit or a natural disaster. This will free you up to keep going forward in a hassle-free manner to do your best work.

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