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Small Business Expansion: Are Legal Issues a Barrier?

by | Dec 8, 2015 | Business Law


While many small business owners look forward to the expansion of their company, they also fear additional legal complications that come with business growth. In fact, in a recent survey focused on small business owners, it was discovered that 29% of respondents feel that the hardest part of running a small business is dealing with the legal issues.

3 Legal Areas Identified Most Commonly as a Concern for Small Business Owners:

  • Contracts and contract negotiations
  • Incorporation issues
  • Real estate transactions

Business owners hoping to expand to take advantage of the potential benefits without leaving themselves completely open to the legal risk can do so by:

Learning contract negotiating skills is vital for all small business owners. It decreases a lot of procrastination due to fear or “nerves” that could harm the company’s profitability. Out of the 52% of survey respondents who actually faced legal complications in 2011, the most common contracts were related to some type of failed contract negotiation.

Thoroughly documenting, i.e. putting things in writing is also vital for small business owners who want their company to succeed and grow. Items that should always be in writing include: employment agreements, agreements with independent contractors, nondisclosure agreements, etc. If the company is making an “agreement” of any type between two or more parties, it is best that it be a written agreement with signatures included. Verbal agreements, while technically binding, can be extremely difficult to prove to the court if a dispute arises. Always utilizing a written agreement is the most cost effective move business owners an make to avoid potentially costly legal issues.

If you are a business owner worried about current or potential legal issues that could hurt your company’s chances for success and growth, get in touch with the southern California business attorneys at The Law Office of the Law Office of Ernesto Aldover.