How your small business can trim costly legal fees
No entrepreneur looks forward to spending money on legal fees.
But in today’s business world, lawyers are not only beneficial to your company, they are essential. Proper legal advice can make – or break – your business venture.
I’ve written before about just how important a good corporate lawyer is for small business owners.
To recap, lawyers help protect your business from negative impacts by analyzing – and addressing – what could go wrong. A lawyer also helps to clarify business relationships so that all parties will be content with the results.
With the understanding that legal fees are necessary for the future of your small business, the tips below will help you keep them as low as possible.
1. Hire a lawyer with expertise in a specific area of law
One mistake entrepreneurs may make is to hire a lawyer that they have used in the past – or one that was recommended to them – for an unrelated matter. No lawyer is an expert in every area of law. The lawyer who helped you close on your first home probably does not specialize in business law. If you’re looking for a business lawyer, find one that has corporate law expertise. It’s also beneficial to find a corporate lawyer that has litigation experience. (See my previous blog post, Three Reasons Your Corporate Lawyer Should Have Litigation Experience.)
2. Don’t hire the cheapest lawyer you can find
Cheaper doesn’t always mean better, and it certainly doesn’t mean you’ll save money. You may end up paying more than you bargained for – in dollars and stress – having to fix errors or oversights made. Find a lawyer with several years of experience drafting the kinds of contracts or documents you need help with in your particular industry.
3. Hire the “right” lawyer
Every successful business draws on successful ongoing relationships. In order to foster positive long-term connections, you want a lawyer that will get deals done – deals that leave both parties happy. That means starting out business relationships being fair and balanced rather than taking advantage of another party. The “right” lawyer will not only protect you from being taken advantage of, but he or she will also highlight the points of a contract that you should fight for and ones you can be more reasonable on.
4. Understand your lawyer’s legal fees
At the start of your relationship, you should be clear about how your lawyer will charge you. Is it hourly or flat fee? What about the lawyer’s out-of-pocket expenses? Who will be working on your file and billing you? You may ask for an estimate on a given matter, and whether you may be billed more if it takes the lawyer longer than expected. This information also helps to guide you in how you communicate with your lawyer. For example, if your lawyer bills on an hourly basis, then you may wish to limit the pleasantries when you call, opting for short, to-the-point calls instead. You may also wish to save up all your questions for one email or phone call rather than sending them to your lawyer piecemeal.
5. Undertake as much administrative work as you can
Be prepared and organized for meetings with your lawyer. Bring in all the documentation that may be necessary, and try to make the records chronological. If you don’t, it’s likely the lawyer or his or her staff will have to do so, and bill you for their time.
6. Once you have a good lawyer, keep him or her on your roster
The ultimate goal for an entrepreneur is to find a business lawyer that you respect, and one that can grow with your company. A lawyer familiar with your venture’s needs and goals will be far more efficient in the future.