Taking Care of Business: How To Avoid Common Mistakes When Running a Small Company

Becoming an entrepreneur can be exciting as you start up your own business and fulfill your dreams. Despite your best intentions, however, it is possible to make mistakes along the way that can affect your company, your reputation, and the profit your business brings in. Check out these common issues many small business owners run into when first starting out and learn how you can avoid these problems for yourself. 

Forgoing Legal Help

Many new business owners try to avoid using a lawyer for fear of running up a steep bill quickly. While quality legal advice isn’t cheap, it’s important to get help when you need it. There are certain areas that you should seek help with from an attorney, such as protecting your company’s intellectual property or establishing equity rights for your business. Not getting the legal advice you need can cost you more money later, so it is better to be safe.

Cutting Deals and Hiring Friends

Although it can be tempting to do business with friends and family, you want to tread carefully here. While cutting them a deal occasionally might seem okay, it could lead to your business not reaching its full potential. According to experts, another problem that crops up is failure to document adequately when working with friends or family in any capacity, from performing a service to investing. Whoever you are hiring, make sure to document everything and focus on marketing to the public so you aren’t having bad interactions early on. 

Running the Business Inefficiently

Sometimes it is hard to get into a rhythm when running a company. You might adopt routines or methods that are meant to do in a pinch, when there are more effective ways of handling issues, such as completing payroll or stepping up your advertising game. 

If you are writing paychecks by hand, this process can get tedious quickly, especially as you add more employees to your roster. Consider products that can give you more time back into your day, such as a platform that offers payroll services. You can find payroll solutions that provide auto payroll scheduling and manage the calculating for you and even tax-filing.

When it comes to lending a boost to your advertising or marketing, look for tools like an online banner template to help you quickly create custom banners for your website and social media platforms.

Last but not least, you’ll need software and apps to help you manage your team if you have people who work out in the field. By using effective tools to connect office and field staff, you can keep track of projects in real time and prepare schedules accordingly.

Losing Out on Legal Protections with the Wrong Business Structure

There are various small business structures that you can choose from when forming your company. It is crucial to read through the guidelines and pick the right one to avoid facing problems later. If you decide to operate as a sole proprietorship and a client sues, this could result in the loss of your personal assets, such as a home or car. A limited liability company can offer protection as well as tax benefits, but each state has different regulations, so keep this in mind when choosing your business’s structure.

Running a small company can be intimidating when you are first beginning. By following the suggested steps for starting a business and keeping careful records, you can avoid a lot of mistakes during your first year as a business owner.

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Written by: Naomi Johnson
Naomi Johnson created lifebasedbusiness.net for small business owners, creatives, solopreneurs, boss babes and bros, and side hustlers who are committed to designing their careers to accommodate how they want to live, instead of the other way around. Through her site, Naomi offers practical advice and inspiration to help others adopt the life-based business mentality and change their lives in immensely positive, fulfilling ways.

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