The first issue to address when you buy an existing business is the role of the seller in your new business. If the seller is going to become an employee, you will need to discuss the role of that seller as the employee is going forward. Having someone who is a business owner sell the company and then stay on as an employee can potentially create obstacles and confusion. In most cases, the seller has a vast amount of experience in the industry, so you want to keep them on. It’s also important to draft non-compete and non-disclosure agreements between you and the seller. The last thing you want to do is buy a company from someone who then opens a competing business nearby.
On the other hand, if you are considering selling your company, the first question you have to ask is how much your company is worth on the open market. This can be very important for small businesses if they decide to sell their business to someone they know. This doesn’t necessarily mean that you’ll get the whole value of your business for that, but it does mean that you will need to enact promissory notes because the buyer is not able to afford the full value of the business upfront.
When you buy or sell a business, you need to be thinking about how your agreement is going to play out long term. Whichever side you’re on in the transaction, how is the agreement going to wind out to a complete transfer of the company? If you’re running a business, you will be dealing with vendors, customers, contracts, and agreements on a day to day basis. Your attorney can certainly help you foresee those interactions, and handle them well in advance.
There will also be reactionary situations and decisions that need to be made, such as what happens if vendors don’t fulfill agreements or customers don’t pay for your services on time, or what to do with a disgruntled employee. Oftentimes, this can be a chain reaction, causing other issues. These are the common, day-to-day business operations that our firm certainly can help with.
What are some issues that business owners can handle on their own without an attorney?
Although it isn’t necessary that you hire an attorney for every issue, it is a great idea to have an attorney that you are comfortable with so you can pick up the phone and call when you need to. However, at the end of the day, if you are entrepreneur or a small business owner, the failure and the success of your business is ultimately in your hands.
One of the most difficult things to do is lead and manage other people. Those are the issues in which it may not be necessary in the best interest of your business to pick up the phone and ask the attorney’s advice, such as motivating your staff and promoting a good work ethic. With any other legal issues, we can lead you down the right path, and warn you of any pitfalls that your actions may be leading you towards.
For more information on Issues With Buying Or Selling A Business, a free initial consultation is your next best step. Get the information and legal answers you are seeking by calling (864) 982-5930 today.