Let's be honest, it is hard to FOCUS 100% of the time.

We all know the sayings: "starve your distractions, feed your focus", "focus on the outcome, not the obstacle".... unfortunately, motivational quotes don't always work in business.

What can work though is clearly articulating what your goals are, detailing a plan of how you will go about achieving those goals and taking a good, hard look at yourself to identify what's achievable and what you need help with.... that is, you need a BUSINESS PLAN!

If you have a written plan, it is easier to FOCUS on that plan. Distractions will arise, that's life. Obstacles will present themselves, that too is life. Having a clear plan will help you to focus and overcome those distractions and obstacles.

At the moment, many businesses are:
(a) finding themselves with time on their hands; or
(b) madly scrambling to pivot to new offerings.

In either case, a BUSINESS PLAN will assist. Do you have a plan in place? If not, why not?
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I have been asked a couple of times recently about my WHY, HOW, WHO and WHAT?

Here is what I said:

I started Cross the T with a view to doing things differently - providing commercial legal advice and business consultancy services to start-ups and SMEs in a responsive, flexible and affordable manner.

Responsive: I get back to clients ASAP and keep them updated on progress.

Flexible - I know that small business owners aren’t working 9-5 days and so neither do I.

Affordable - I operate a lean practice with low overheads and can therefore keep my costs down. I offer fixed-fees so that clients have transparency and clarity at the outset.

I was close to leaving the law a few years ago on the back of extreme burn-out… but after some pretty extreme soul searching, I realised that the law makes me happy. Helping businesses to navigate the minefield which is the law makes me happy. Talking to engaged, enthusiastic and intelligent business people makes me happy. I love applying my analytical mind to complex problems and I love breaking difficult concepts down so that they’re digestible by all.

That's my why, my how, my when and my who..... what's yours?

No matter the nature of your start-up or small business, there are a range of common legal issues which you will need to turn your mind to.

These legal issues include:

• Your business structure – three of the most popular structures are sole trader, partnership and company (incorporated) structure.  The decision around which structure will best suit your needs will depend upon a range of matters including financial structuring, cost implications, business ownership and risk profile.

 

• The Australian Consumer Law – all businesses that provide products or services to consumers in Australia need to comply with the consumer law which includes a range of guarantees and warranties that cannot be avoided.  This includes providing consumers with a refund, replacement or repair in circumstances where the product which you have supplied is defective, not fit for purpose or doesn’t match the description of the product that you provided (including on your website).

 

• Differentiating between employees and contractors – employees are entitled to a range of employment benefits and entitlements.  It is therefore important to understand whether the person that you are hiring to undertake a task for your business is an employee or a contractor – if you wrongly determine that the person is a contractor and the ATO or Fair Work Australia determine that the person is instead an employee, you will be bound to make good on entitlements that the person would otherwise have been entitled and you are liable to incur fines and penalties.

 

• Protecting your confidential information – the first question for businesses is “what is our confidential information”?  Often, confidential information will include client lists, your financials (including your margins), your design and methodology, ‘secret’ ingredients, contracting arrangements and proposed business takeovers/mergers.  The next question for businesses is “how can we protect that confidential information”?  There are a range of legal and practical mechanisms that businesses can and should implement to protect their information, which is often one of their key assets.

 

• Protecting intellectual property – businesses should consider trademarking those aspects of their brand that sets them apart from competitors.  Similarly, if a business has a particular design underlying its products/service, a new methodology or IT related process which is inventive or innovative, that business should consider seeking patent protection.  Businesses should also take care not to do anything prior to obtaining patent protection which may put the ability to gain patent protection at risk… this includes going public with the idea without appropriate protections in place.

 

• Privacy Act compliance – while many small businesses do not reach the threshold at which compliance with the Australian Privacy Principles becomes mandatory, it is good practice for all businesses (including start-ups and small businesses) to implement compliant processes.  This includes having a transparent and easily understood privacy policy in place and available to clients and consumers.

Has the COVID-19 pandemic exposed gaps in your processes, procedures or work place policies?

Many businesses have found themselves exposed with the sudden onslaught of employees working from home; new ways of sharing data and information; increased health and safety obligations; different reporting obligations; and different ways of doing things....

Is your business well prepared to overcome the inevitable gap that the current circumstances have exposed?

Let Tania White or Barry White of Cross the T know if you would like to discuss your current processes, procedures and policies to identify what gaps exist and how you can overcome them (tania.white@crossthet.com.au / barry.white@crossthet.com.au).

So you're thinking about SCALING YOUR BUSINESS?

Are you ready to scale?  Are your foundations right?  Your growth may come quickly and so you need to make sure you’re ready before you start.  

What’s right for you and your business?  Growth isn’t for everyone and every business – make the right decisions for you. 

Scaling can be dangerous if it happens too fast - growing in size and revenue before the business is ready, over investing in resources and not creating solid foundations as required to support the growth can create disastrous outcomes.

If you decide that scaling is the right move for you, create the right mindset, make sure your team is ready, determine what your core competencies are (what makes your business successful?), collaborate with the right advisors, employees and mentors and ensure that your foundations are correct.

Is your existing legal structure adequate, appropriate and robust enough to support your anticipated growth?  If and when you get financial injections (be that via third-party investments or otherwise), you will need to consider the deal structures and payment requirements.

The key takeaway: get the basics right before scaling.  The basics can be tedious and no where near as sexy as launching a new brand, new product line or service offering, but scaling before getting the basics right could be a major flop, produce mediocre growth or set you up to fail.

I've heard that Warren Buffet (who we all know is one of the world's greatest business magnates, investors and philanthropists) was once asked to define risk. Instead of going into chapter and verse, his answer was simple:
Risk comes from not knowing what you're doing...

Now, you would be hard pressed to find a contract or a commercial deal in which the parties are not exposed to some degree of risk. In my mind, that doesn't mean that the parties don't know what they are doing, it's the nature of business. However, if the parties cannot or do not identify and address those risks, then they may just fall into the category of not knowing what they're doing.
That is why it is imperative to conduct an effective and accurate assessment of all contractual risks at the outset. 
Risk analysis is about developing an understanding of the risks posed. It considers the types of risks, the sources of risk, their potential positive and negative consequences and the likelihood that those consequences will occur.
The purpose of risk evaluation is to understand the outcomes of the risk analysis and to make decisions about which risks need treatment and what your priorities should be.
There are a range of ways in which to address risk and its treatment... the treatment option which is closest to my heart as a lawyer is that of legal risk transference – the act of transferring the relevant risk to your contractual counterparty.  Alas, legal risk transference is not always an option, or may not always be the most commercial option.
Other methods for treating risks include:

• risk elimination – not proceeding with the current proposal or proceeding on a different basis such that the risk no longer exists.
• risk reduction – undertake further due diligence to better understand the risk and implement practical steps that reduce the consequences of your risk.
• risk retention – retain the risk but insure against the consequences of that risk.

Risk analysis is a vital step in "knowing what you're doing". Remember, you cannot address the potential consequences of a risk unless you understand the risk in the first place. You cannot understand your risks unless you undertake risk analysis.  
Don’t put your head in the sand around risks, it won’t make them go away, it just means that you’re unprepared when they come to pass.

In the business world, joint ventures really can be described as a great business love story.

Joint ventures offer the joint venturing partners a range of benefits including:

• each party gaining access to additional resources as they come together to pursue a mutual and specific goal;
• the ability to win and complete projects which each party may not have had the resources to complete on their own;
• increased resources leading to an increased market share;
• the sharing of risks and costs; and
• accessing increasing opportunities for growth, including financial growth.

While joint ventures can offer great rewards to the joint venturing partners in the right circumstances, they are not without risk. 

That's why it is imperative that the joint venture arrangements are appropriately discussed and documented at the outset of the relationship, while love is young, optimism reigns supreme and the roses smell sweet.