Contrary to what many people think, starting and running a business isn’t always a walk in the park. In the early days of your business, you will likely struggle marketing your business and handling finances. Unfortunately, one of the biggest hurdles that are hard to go by is legal inconveniences. So, what are some of the legal threats that make it hard for businesses to grow? Below are 4 common legal threats that most businesses face.
1. Not Meeting Licensing Requirements
As a business owner, one of the best ways to ensure your company starts on the right footing is to acquire the necessary licenses. While each state has its own policy on licensing, remaining compliant enables your business to run and grow with little or no impediments. Note that there are licenses that expire every year, hence the need for annual review and renewal.
2. Employment Legal Requirements
In America, most employment is done using legally binding contracts. Once the employer and the employee have signed such contracts, it becomes their sole responsibility to keep them confidential. More importantly, both parties should honor the contract. As a business owner, if you fail to comply with the legal requirements of the employment contract, you risk facing hefty fines and prosecution, thereby hindering your business growth.
3. Tax and Insurance Compliance
There is a good chance the business you run will generate profit and pay staff. If so, you need to pay tax and submit annual tax returns appropriately. Some of the taxes you will have to comply with include excise tax, Pay As You Earn (PAYE), income tax, etc. More importantly, you can consider having business insurance to ensure your licenses are well protected in case of a mishap. If you own commercial property, then business commercial is essential to your business. Keeping your business covered will help you minimize future legal and financial risks.
4. Copyrights, Trademarks, and Patents
As your business takes its first major steps, you need to consider doing thorough research on patents or copyrights in the market. More often, some companies make easy money by violating patents. Unfortunately, the danger of doing this is that you risk attracting costly legal battles that can drag your business down over the years. To remain safe, avoid existing trademarks, copyrights, or patents at all costs.
Even though these are the most common legal threats that impede most businesses from achieving positive growth, others that are worth mentioning include undefined business structures, workplace discrimination, and lawsuits from dissatisfied consumers. The good thing is that with proper planning and preparation, you can significantly avoid these legal inconveniences that would otherwise hinder your business growth.
