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Fazzio Law Offices

5 Biggest Challenges Facing the Small Business Owner

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  1. Accessing Capital to Fund Your Growth

Most small business owners struggle to have access to sufficient capital to fund their operations and their growth.  What are my financing options?  Should I sign personally for a business loan and give the bank a personal guaranty?  What should my financials and presentation materials look like to attract different kinds of investors?  How do I negotiate loan terms?  What is a Kabbage loan?  What is an SBA loan?

We have a client who started a business with $0 capital.  She found an angel investor that put down about $2MM to fund start-up, build-out, and get this unproven business up and running.  We have another client who was orchestrating a turnaround who had a $5MM tax debt and needed to leverage his business’s real estate assets and finance them to come up with the money to pay out his tax debt.  We found an investment group that had a family office who wanted to fund this deal and guided him through the process of getting all the necessary paperwork together to make the deal a reality.  We had another client who went through multiple stages of investment financing through accredited investors and VC’s who evaluated his PPM.

What is the common denominator for all of these clients?  John Fazzio.  Having a small business lawyer on your team is not necessary to getting a loan or to getting financing.  But, it adds credibility to your pitch, ensures you don’t make rookie blunders with negotiating legal contracts, and allows you to negotiate without the fear of running afoul of regulatory or contract faux pas.

Who you gonna call?  A Small Business Lawyer.  John Fazzio.  (201) 529-8024.

  1. Marketing Your Products & Services

For many business owners, it is a mystery what causes the phone to ring.  Even more mystical is what to do when the phone stops ringing.  Markets are made up of people.  And people are constantly changing.  What is the talk of the town one day is old news the next, and yet there are perennial favorites like pizza and ice cream that seem to never get old.  This is why so many restaurants come and go in the blink of an eye, while others stand the test of time.  What could be more important than keeping in touch with your customers and understanding their changing needs and preferences so that you can provide excellent customer service?  And yet, how many business owners enlist the talent to make marketing a priority?  What about you?

Marketing is like jujitsu.  The goal of jujitsu is to cause your opponent to submit.  But, the techniques and the various moves and holds one can deploy are virtually limitless.  Even a novice can understand jujitsu in theory.  But, that doesn’t mean they can hold their own against a master.  Mastering these techniques and knowing when and how to use each one takes years of experience.  You wouldn’t go up against the world’s foremost jujitsu expert after a few months of training.  But, this is precisely what most business owners do when they try to do their own marketing without professional help.  They bet their companies on their ability to go up against the “masters” who are helping their competitors, and their very fortunes lie in the balance.  Talk about a recipe for disaster!

What does this have to do with lawyers?  We know the best marketers!  A small business attorney works with many businesses and sees how they market and who they use in their businesses.  We market ourselves!  We work with and litigate against digital marketers, advertising agencies, PR agencies, Instagram influencers and all the rest.  And we also know what a good contract looks like and what a trap looks like.  Let us help you connect with the right marketers and get the right deal, with perhaps the most critical part of your business. We want to work with you on this.

Who you gonna call?  A Small Business Lawyer.  John Fazzio.  (201) 529-8024.

  1. Hiring the Right People to Execute Your Vision

Most business owners don’t prioritize recruitment and as a result they are stuck in the unenviable position of picking up the “leftovers” that the market has rejected – the unemployed or underemployed who are looking for any opportunity that should present itself.  But, this shouldn’t come as a surprise considering these same businesses have not even prioritized listening to their core, loyal customer base and doing serious marketing.

So, what should companies be doing?  Model your best competitors.  Get to know their people.  Look at what makes a successful employee in your organization and the kind of people your clientele work with in other walks of life – their realtors, financial advisors, accountants, etc.  When you meet a someone that impresses you across the table, in a competitor’s company, or at another vendor that serves your clientele—or even at the local bar/restaurant—give them a card and add them to your list of recruits.  Personality, attitude and role compatibility have been statistically proven to be far more important than technical skills, which are increasingly teachable and transferrable.

But, let’s face it, even if you do everything right, your going to get it wrong around 50% of the time.  Good employment contracts, good employment policies, and good processes for firing employees are all critical to avoiding lawsuits, to maintaining company morale, and to sustaining a positive company culture that sets clear expectations and lives by them.

So, what to you do when a disgruntled employee leaves and tries to take your clients, or worse yet, steals your proprietary trade secrets?  What do you do when you are sued by a former employee for unpaid wages, or worse yet, receive a Wage & Hour complaint from the local Department of Labor?  What do you do when you are accused of discrimination or sexual harassment or retaliation when you’ve done nothing wrong?

Who you gonna call?  A Small Business Lawyer.  John Fazzio.  (201) 529-8024.

  1. Dealing With Delinquent Accounts Receivable

Cash is the lifeblood of any business.  Do you watch your business account balance like a hawk?  Do you log in 5 times a day?  More?  Do you have a running list of accounts where you are waiting for their payments to come in?  What are your billing & collection policies? 

If you are like most businesses you haven’t systematized your accounts receivable and payment policies.  Why not?  Your credit card company, your electric utility, and your automobile financing company all have a standardized system for collecting what they are owed.  And so does that other guerrilla – the IRS.  Why?  Because they know what works and they have done the math.  Have you?

Most companies manage receivables based on the “bucket approach.”  If there’s money in the bucket, times are good.  If the bucket is empty, they come down on their clients like the drill sergeant in “Full Metal Jacket.”  But, is this a good way to collect money or build client loyalty?  Not at all.

Billing should be done in a systematic way.  Collections should follow a pre-set strategy.  Consistency gets the best results.  No amount of skill will ever match a good system or even come close.  So, what is your system?  And is legal enforcement of money owed a viable and realistic threat your customers know is downstream or do they disrespect you and assume that they can get away with non-payment indefinitely with no repercussions?

Deal with your customers with great latitude, but make sure you have a plan for collecting those delinquent accounts where you can’t come to terms, for cutting off severely delinquent accounts before they become a problem, and make sure that your customers know you are serious about being paid.

Who you gonna call?  A Small Business Lawyer.  John Fazzio.  (201) 529-8024.

  1. Defending Against Threats From the Competition While Innovating and Offering a Unique Value Proposition to Your Clients

Simply put, your competitive advantage is the key asset of your business.  What unique value do you bring to the table?  Is it a technology or process?  Is it a product?  Is it a trusted brand?  Whatever your unique value proposition may be, you need to protect it from competition and fend off copycats and competitors who want to compete unfairly against you.

What happens when your trade secrets are stolen?  What happens when an employee leaves with your intellectual property?  What happens when your competitor steals the formula for your secret sauce?

If you don’t know the answer to that questions, you need a trusted adviser who does.

Who you gonna call?  A Small Business Lawyer.  John Fazzio.  (201) 529-8024.

Category: Small Business Law


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