Running an SME business isn't easy - and it's made all the more challenging by the complex economic and political climate that surrounds the country at present, plus the constant influx of new legislation, which can be tough to keep abreast of. However, it can also be hugely rewarding and prosperous when done right. That's why it's all the more important to stay on top of the seemingly boring and difficult parts of running an SME just as much.
In a recent survey by YouGov, it was found that SME businesses are losing over £13.6 billion each year simply because they're not taking care of their legal issues and concerns. They found that disputes were costing SMEs up to £1.7 billion, and on top of this, there were up to £1.6 billion in costs surrounding problems with employees and contractors. It's not just about saving your business serious money but protecting yourself from the associated hassle too.
There are some key things you can do to prevent this from happening to your SME. Firstly, it's important to ensure any tenancy agreements you may have are drafted up and signed properly upfront. Otherwise, they can come back to bite you, especially if you have invested any money into your office space to make it work for your business.
Before signing any documents, it is important to take legal advice. It may cost you money in the short-term, but in the long-term, it'll be an investment well spent. The devil really is in the detail, and a legal professional will be able to spot where potential disputes or problems may arise. Along with saving you money, this will also save your business from becoming disrupted if tenancy matters were to force you out of your office space. You should always keep a copy of your lease too, and ensure it has both parties' signatures on it. You should also have some savings set aside for any legal potential disputes that may arise, so they don't hit you too dramatically.
Additionally, this same due diligence and care should be taken with any contracts signed with employees. Although when hiring them you will only ever see the best in them, and vice versa, this can't be taken as gospel for their entire time with you. It's important to have appropriate contracts in place that not only protect you while they are in your company, but also once they have left - for example, ensuring they cannot take business data or confidential information with them, or that they won't go on to work with your competitor straight away. Contracts should always be reviewed periodically to ensure they remain in-line with company policies and are cohesive with any new HR developments. If matters do arise, you should always seek legal advice to ensure you are not going to get into any lengthy disciplinary cases or so your staff can't put you in a difficult position. It is important that you always record any interviews or agreements, to ensure there is never any confusion over what has been agreed.
Additionally, with any intellectual property, you need to make sure you always have a clear idea of your rights and obligations when it comes to bespoke products or software. You need to know about any potential IP risks, especially when manufacturing abroad, and should always invest in getting any intellectual property trademarked and patented to protect yourself.
The hugely popular "fidget spinner" device was created by an everyday mum in her home. When she went to meet with the huge toy stores, none wanted to buy it from her. However, when the patent expired, she couldn't afford to renew it and, as no one had been interested in the toy, she didn't. Except, as soon as this happened, the large toy manufacturers swooped in, took the design, made it themselves, and have profited hugely from her work, turning it into one of the hottest children's toy trends of 2017. To avoid facing the same fate, our advice here is to keep a clear record of anything trademarked and patented, and also ensure the necessary logos are always visible as a deterrent.
Collecting and storing information about your customers is also another key area of the business where potential disputes or legal and privacy issues may arise. While there are legal requirements regarding what you can do with the information you have collected, one sure way to protect your customers' information is storing their data in a database that will prevent hackers from breaching your customers' privacy.
When it comes to legalities and data security, organisations should put the above points we've discussed as one of the top, if not the first priority in their growth plan. Failing to recognise the importance of legal matters and privacy issues can impede company growth, if not, jeopardise the entire nature of a business, as exemplified by the "fidget spinner" case.
Don't let this happen to your SME. Luckily, All the above issues are avoidable with a secure and reliable whole-of-business solution that not only protects your information, but helps you boost your business growth. One system that does this really well is SAP Business One Cloud. Read our Security Spotlight document to learn about the advantages of the cloud and how SAP Business One Cloud can help growing SMEs streamline operational efficiences and drive more profit.