In an increasingly complex economy, you should take heart that no one knows it all. In fact, the trend is for people to specialize in ever more specific niches. But that’s no reason to shy away from starting your own business.
There’s an expert for everything you need to know to succeed.
You should consult them before you sign your name on any contracts. And yes, you will have to pony up for their fees, but count this as insurance against making rookie mistakes that can cost you a whole lot more down the line.
The two people most important to saving you a world of regret later are your accountant and lawyer. But not just any one will do. You need to find one who is an expert in the area about which you need advice.
Consult an Attorney
Just as you wouldn’t hire a civil attorney to defend you in criminal court, if you want assistance on buying a business, consult attorneys who make this their specialty.
If you’re buying a franchise, we highly recommend you consult a franchise attorney who has read hundreds of standard franchise contracts and can help you recognize potential pitfalls and help you figure out ways to protect your investment.
The most important task for the franchise attorney will be to review the Franchise Agreement and the Franchise Disclosure Document. Do not entrust this to an attorney who does not specialize in franchising. These documents can easily total 200 pages or more. You want your advocate to be someone who knows exactly where to focus their review.
An attorney can also help you:
- Check trademark registration – Does your franchise use a name eerily similar to another local business?
- Set up a legal entity – To protect yourself from third-party claims.
- Negotiate a lease – A bad one can lock you into a costly expense for years to come.
- For franchises, ensure you have a protected territory – Some franchisees discover only too late that the contract may allow another franchisee to operate within a block of their location, which fractures their market share.
Just as you would never attempt to read up on the law so you can avoid hiring an attorney, you should not try to fast-track an accounting course to help you make smart financial decisions for your business.
Consult an Accountant
Two main accounting issues exist for the entrepreneur, but, of course, they are the essence of your business. You need to be smart about:
- How to finance your business and
- How you manage operations. Good mechanisms for measuring key indices of your business can help you correct errors early and capitalize on strengths.
Accountants bring essential expertise drawn from experience working with hundreds or thousands of other businesses before you.
As you have likely heard, most new businesses fail due to insufficient capitalization.
Managing cash flow may be your most important responsibility even if it has nothing to do with your core ideas, talents or skills. And that’s the point. Hire an accountant. How else are you going to know if you actually have the next big thing if you can’t make it through the start-up phase.
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Contact Dan Citrenbaum to help you create the career you’ve always wanted. As a franchise coach, Dan brings years of experience helping people select and buy a franchise or existing business. You can reach Dan at dcitrenbaum@gmail.com or at (484) 278-4589.
© Dan Citrenbaum 2015
This guest post is by Dan Citrenbaum, a Franchise Coach and Entrepreneurial Consultant who helps people achieve their dreams as small business owners. Find Dan at www.EnterpreneurOption.com.