The first, and most important, issue is to know the limit of your liability and to protect yourself and your investment in your company by incorporating your business. In order to do this, it is important to consult with an attorney and disclose everything about your proposed business venture and past business experiences, both positive and negative. Your attorney can help outline the advantages and disadvantages of the various forms of business entities. Together, you should review all of the “corporate formalities” to which you must adhere in order to preserve the limited liability afforded to you by virtue of having incorporated your business.
As you get to know your customers and suppliers, your attorney can create contracts that suit your specific needs with each of them. Discuss with your attorney the need for a written employee handbook and written employment agreements containing confidentiality and non-competition obligations if necessary.
If you intend to enter into a partnership, you must discuss with your attorney the need for a detailed written buy-sell agreement with your business partners. If you and your partners do not spell out your rights and responsibilities in a written partnership agreement, disputes could end up being a “free for all” and create nothing but additional work and expense if conflicts arise. In addition, without a written agreement saying otherwise, your state’s law will control many aspects of your business. A partnership agreement allows you to structure your relationship with your partners in a way that suits your business. It outlines the shares of profits or losses for each partner, the responsibilities of each partner, and what will happen to the business if a partner decides to no longer be a part of the business.
This process must be carefully considered and outlined. As such, it is important to consult the proper professionals who can help you make the right decisions.