It is common for people’s enthusiasm to get the better of them when they feel excited about a business concept. Someone enthusiastically planning their farm-to-table grocery delivery service or a battery exchange program for hybrid and electric vehicle owners may become so focused on securing a specific result to the process and getting their business operational that they fail to address key factors that could complicate their circumstances later.
Overlooking certain issues during the planning and early business growth stages can lead to real challenges later. Ensuring that you handle all three of the matters below will help you start operating with the best chances of success.
- You need operating agreements and bylaws
Depending on how you structure the company, the exact paperwork you need to have in place will be somewhat different. However, you absolutely need to have written documents discussing business operations and the authority that different individuals will have.
Although some people use a cut-and-paste method by copying sample documents from the internet, the creation of unique bylaws created to address the specific challenges your company will face can do a lot more to protect you and better ensure your success.
- Don’t use generic paperwork
From your business plan and bylaws to your employment contracts and agreements with your vendors, there will be many forms and documents that dictate how your company operates. Using boilerplate paperwork by inputting a few details into pre-existing forms will only offer your company minimal protection. The best contracts are those custom created for your purposes.
- Don’t get comfortable with the paperwork you have
Creating contracts, whether it is an employment agreement for your first hires or service agreements for your clients, is a process you will need to revisit occasionally. As the way your company operates or the law changes, you will need to make changes to your contracts, employee handbooks and other key business documents.
You may also need to revisit and update your contracts to address issues that have arisen since starting your business. An example might include adding restrictive covenants to your employment contracts to protect your trade secrets as your company becomes more successful.
Learning from the mistakes of other people and addressing issues that they overlook when starting a business could help set your company apart from the competition.