The holiday decorations are tucked away, your fridge is full of fresh fruits and veggies and your sneakers have seen more action than your wine stash this week. #crushing2018
But what about your small business goals? Have you given them the same kick in the pants as your personal life? We asked Amanda Montgomery, Flea Style mentor and attorney, to help lay out an easy to digest — and accomplish! — list of to do’s to get a small business on the right side of the law and ready to grind in 2018.
Here are her six key areas that small businesses should focus on to start the year off right.
1. Register your business entity
(If you’ve already registered your business with the state, you’re doing amazing sweetie, skip to #2.)
If you haven’t made the transition from a sole proprietorship (or general partnership) to a registered business entity, this year should be your year. Consider filing your formation documents early in the year so that you can organize the rest of your finances around this new, separate entity (read this for helpful LLC tips). If you can’t get your filings together in early 2018, try taking a baby step: pay a nominal fee and file to reserve your company name. (Name reservation forms are available in Texas here check your applicable state for more information). Name reservation will put you in the mindset that you’ll be operating your LLC — or whichever entity you choose — soon and you’ve already started the process. Time to think about what your company agreement will include, as well. Consider management, ownership percentages, voting, transfer of ownership options, and dissolution. Sound like something you can skip? Maybe think again. This type of governing document is required for some loans, purchasing real estate for your business or other things as your biz grows and evolves. If this makes your head spin, talk to a business attorney. I’ve drafted several company agreements for clients, and I find they’re one of the easier documents to explain and adjust for each client’s needs.
2. Get your finances in order
Most business owners are fairly confident in their ability to track sales, complete invoices and pay bills. But operating a business also involves timely payment of taxes and specific reporting to state/federal agencies. You also have to create a fail-safe budget for the year. If this is entirely outside your skill set, accountants can help you with these tasks (and many more) and they’ll ensure you complete your filings on time. I often coordinate my work and my filings with my clients’ accountants because it saves my clients from incurring losses (and stress headaches). Call and ask for a consultation. I highly suggest you talk to a few different CPA firms in order to decide your best fit. You would never settle for a just-okay physician for yourself, so don’t settle for a just-okay CPA for your business. The same goes for lawyers, but we’ll get to that!
3. Give your e-commerce platform a good look
E-commerce is more popular than ever but is your platform the right fit for you? Are you seeing solid sales and think the user experience is stellar? Many small businesses set up shop on larger platforms, and are noticing hikes in seller fees. It’s important to ask yourself whether there are more affordable, efficient platforms that check the same boxes as far as tracking your sales, payment processing and analytics. As you’re shopping around, make sure to read the entirety of new user agreements to ensure you’re retaining the majority of the revenue coming in. It can be very easy to be lured to a popular site and not realize how much you’ll ultimately pay in fees for each sale. If you end up changing your platform or dropping your payment processor, bear in mind you’ll need to comply with e-contracting rules and cardholder data rules (PCI compliance). This may be the year for trying new avenues. You may find selling directly through social media actually works for your product based on your loyal following and that now is the time to figure out how to strategically set up flash sales, contests, giveaways and other promotional events. There are contest rules of course — so do your research prior to posting — or ask your lawyer how to stay compliant!
4. Sharpen your skills
Committing your time (and money) to a seminar or a course can feel like a gamble, but it could make a huge difference in 2018. Lawyers actually have to take several hours of courses each year to keep our licenses (for me it’s 15 hours), so I can attest to this being tough at times to manage. It’s ultimately worth it though, because there are always new developments that I’m responsible for learning. The same goes for small businesses and the constant evolution of the maker movement. Small business owners owe it to themselves to keep up with developments in technology, marketing, and social media. Fortunately, there are resources everywhere you look — there are classes online, at community colleges and mini-workshops all around your city. (Flea Style hosts them too!) Even if it’s just signing up for a one-session photography course, you’ll likely see results with sales and customer engagement.
5. Set up a proper office, wherever it may be.
This year may not be the year you purchase work space in a beautiful downtown building, but it should be the year you straighten up your office and gear it toward accomplishing your business goals. If you’re currently reading this from your home office and your desk is also your kitchen table, now is the time to designate a room (or corner) that’s strictly for business operations. (This can also help you write off your home office when tax time rolls around.) Try to avoid the high-traffic spots in your home and make sure you can (figuratively) clock out each day; it’s vital to separate your work space from your living space so that your work day actually ends. If you’ve mastered the art of working from home but find yourself starved for interaction or networking opportunities, 2018 should be the year to experiment with shared work spaces. There are dozens of options now in most cities and they don’t operate under the traditional leasing model. Call around and arrange a few tours — you have nothing to lose and you may even come out of the experience with new collaborators and mentors. If nothing else, commit a few hours to your local coffee shop a couple times a week for a fresh perspective and chance to nab some new networking opportunities.
6. Talk to a lawyer
As your business grows, you will reach a point where you’ll need council from handling a pesky copycat company to drafting a contract for your biz. You’ll also start receiving contracts that are increasingly more sophisticated, with terms that are not 100% clear. (Many business owners can zoom past this problem, only to revisit it later when non-payment becomes an issue.) Losing out on money can happen frequently when you’re a small business, but it doesn’t have to be that way. Having a lawyer who knows you and your business can be crucial in many respects. In my experience, when my firm has written the contract for our client, that has placed him or her several steps ahead in a business dispute. And whenever a client turns to me with someone else’s contract, my response is to immediately review the terms and flag areas that need to be resolved. Looking at terms through the lawyer lens is not intuitive for business owners, particularly when their focus is drawn to exciting aspects of a prospective deal or relationship. When you task a lawyer with watching out for your business interests in a dispute or with a contract, they are doing exactly what they’ve been trained to do. Lawyers can be an invaluable resource and speaking to one in 2018 should be part of your plan.
Amanda Montgomery is a Texas business attorney at the law firm Culp & Dyer, LLP (www.culpdyerlaw.com) and can be reached at 940-484-2236 and firstname.lastname@example.org. Disclaimer: Amanda Montgomery’s comments are for informational purposes only and do not constitute legal advice. The above comments not form an attorney-client relationship between Culp & Dyer, LLP and this site’s visitors.