President Barack Obama has been very vocal about the significance of small businesses to our economy. According to the White House website, www.Whitehouse.gov, the President views small businesses as "the backbone of our economy and the cornerstones of our communities".
Unlike their Fortune 500 business counterparts, whose heavily entrenched internal culture makes swift change difficult, small businesses are agile, more flexible and can adapt more readily when the economy requires or the business model no longer works. So it comes as no surprise that we as a community put forth every effort to support and grow our small businesses.
Frequently forced to wear many hats, small business owners often juggle legal, accounting, marketing, operations, hiring, firing, manufacturing and distribution duties. Some do it all of this while maintaining a full time job and family. The idea is to grow the business enough so that the entrepreneur can leave the job and focus on the business.
But how do you get the support to build the business? Often the answer comes in the form of other small businesses such as lawyers, accountants, marketing, insurance and real estate professionals. Building a team is the first step.
Legal: Structure, trademark, partners
Legal should be first on the team. Why? Because the first step to starting a business is to create the business structure.
Too many times startups begin as sole proprietorships rather than as a corporation, S-corporation, or limited liability company. As a sole proprietor, the individual business owner exposes personal assets to creditors of the business. Personal bank accounts, equity in the home and any other personal or real property owned is fair game to a creditor or plaintiff in a lawsuit.
Depending on the service or product, there may need to be protection in the form of a patent, trademark or copyright. If the service or product is not protected properly, the result may be dilution in sales when others copy it.
Additionally, the early creation of contracts that identify ownership share, continued contribution effects and organizational structure will be invaluable as the business begins to grow and flourish.
While all professional services are important, marketing is the key to growth. The business can have a great product capable of solving all the world's problems. However, if no one knows that the product exists or how to get it, there will be no sales and no problems solved.
Marketing provides that much needed boost to the business and cannot be ignored or delayed. Marketing should be a component from the beginning throughout the life of the business in some form or fashion.
If the business has assets or employees, insurance needs to be a priority. Not only does the business need to protect the uniqueness of its products and services, but the assets need to be protected.
There are so many types of insurance available that having an insurance professional on your team is crucial. Whether it is life insurance, health insurance, income replacement insurance, workers compensation insurance or disability insurance, understanding the options, pricing and priority can have a major impact on the business.
Deciding where to place the business is critical to the long-term and short-term success of the business. The services of a real estate professional to aid in finding the best location for the budget available may come at a surprisingly low cost.
Typically, the real estate agent or broker is paid from a percentage of the lease by the leasing company or from the closing costs, if a purchase is made. The real estate professional is trained to evaluate traffic, population, income levels of the population, and negotiate pricing.
NOTE: Learn more about building the team this Saturday, March 29th, from 11 a.m. to 1 p.m. during a business seminar titled "The Team" at the Benjamin L. Hooks Library at 3030 Poplar Ave. Seating is limited. Call 901-795-0050 to reserve a seat.