When Do I Need To Hire a Business Attorney?

When Do I Need To Hire a Business Attorney?

When Do I Need To Hire a Business Attorney?

5 Areas of Your Business Needing Legal Advice

By Sarita Smithee

Hiring a good lawyer is crucial to any successful business and nowhere is it more crucial than in commercial construction.  A good business attorney will provide vital assistance in almost every aspect of your business, from incorporation and code compliance to defending you in lawsuits.

Here are five critical times when you should no doubt have an attorney:

1. Before You Get Sued

Many businesses put off hiring an attorney until the sheriff is standing at the door serving them with a complaint. This is bad mistake. The time to engage a good business attorney is before you are sued, so you can head off any potential problems before they turn into a lawsuit.

Once you have been served with a complaint, it may be too late—the problem has already occurred, suit has been filed, and now it’s likely just a question of how much you will have to pay in court costs, attorneys’ fees, settlement, and other expenses to get the problem resolved.  Investing in some far less expensive legal advice along the way could have prevented you from getting sued in the first place.

2. When You Start A New Business

This applies to incorporating a new business or converting a sole proprietorship or partnership into a corporation or LLC.  A business attorney can help you understand the different business entities available to you and the advantages and liabilities each one may have.

Do-it-yourself business startup forms may look simple, but the law behind them is complicated.  Making an uninformed choice at this stage of a business’s life cycle can have disastrous implications later on, and an experienced attorney will make sure you have the information you need to make an educated decision.   You don’t want to find out you’re liable for your partner’s crimes after he’s already committed them, so it’s crucial that you understand the implications of choosing a particular business form before it’s too late.

3. Before You Hire A New Employee

When you hire employees, you’ll want to make sure you comply with the various federal and state rules and regulations. However, even before you hire an employee, the way you draft the contracts your employee signs can have a major impact on your company’s success.  At a minimum, each contract should contain at-will language, a confidentiality agreement, and a non-compete clause.

This will protect your company’s proprietary information and insure that your employees aren’t using that information to benefit another company at your expense.  Specific laws govern the enforcement of these types of contracts, and a business attorney can advise you on the best way to use them in your business.

4. When You Enter Into Contracts

As a business owner, you will do business with many people—customers, suppliers, service providers, independent contractors, landlords, and your own employees.  Most, if not all, of these relationships will be governed by written contracts.  Each of these contracts is an opportunity to negotiate terms that will protect and advance your business interests.  You need an attorney who knows your business and will help you negotiate good contracts.

5. When A Contract Has Been Breached

Many decisions about how to handle a breach of contract or other agreement are time sensitive, and the choices you make immediately after a breach can determine how much compensation you’re entitled to, or if you’re entitled to any compensation at all.

A business attorney can help you navigate these decisions and determine the best course of action, including whether to sue, who to sue, where to sue, and whether some form of injunctive relief is available to give you an immediate remedy.   This type of relief can be extremely valuable if your confidential information is being disclosed or if your business name is being slandered.  This type of damage can’t be undone, even if you eventually win a lawsuit, so you need to be aware of all of your rights and be able to take advantage of them as soon as the issue arises.

Sarita Smithee is an associate with The Beckham Group in Dallas, Texas.  The Beckham Group has extensive experience with, and specializes in, business litigation both as a Plaintiff and a Defendant.  The firm drafts and prosecutes/defends civil cases involving numerous types of contracts, and has just about seen it all.

Vince Fudzie – the blogger’s Reality Bite:  Documentation, Documentation, Documentation. Even the best-planned prepared legal can’t help you much if you fail to follow your contract requirements, whether it is with an owner or general contractor.

Therefore, I can’t offer any better advice than to constantly remind everyone in your company to think litigiously and document just about everything.

The Punch List is Triune’s proprietary blog for discussing issues and providing insights specific to the commercial construction industry. Copyright 2014 TMV, LLC (Triune). Any and all rights reserved.

 

5 Ways Small Contractors Can Compete With the Big Guys

5 Ways Small Contractors Can Compete With the Big Guys

5 Ways Small Contractors Can Compete With the Big Guys

How A Small Construction Company Avoids Becoming Extinct

By Lloyd Facen

Competition is fierce and challenging for business in general and particularly for small construction companies.  How do small construction businesses compete successfully with the “Big Guys” who have access to resources, infrastructure and many other competitive advantages that seemingly turn the competition into one of ecology?

Ecology is defined as the struggle between individuals of the same or different species for food, space, light, or projects when supply is inadequate for the needs of all.

Then how does a small construction company avoid becoming extinct?

One of the things small construction companies should consider implementing to compete with bigger guys is to develop a strategy and understand who you are, what you do well and how to profit from that.  It is at this point you gain insight into your business and can better determine what opportunities afford you the greatest probability of success.  This will help you focus more on your strengths and less on competitors.

Being all things to all people is a very ineffective business model.  While we may all want to take on every new opportunity, we have to do that within a framework that is profitable and efficient for our company.   Larger construction companies may have the resources to take on new business at very thin margins or, for some strategic reason, even at a loss.

Most small general contractors, electricians and plumbers, for example, may not have this luxury, so developing a clear picture of your strategy will afford you the option to forgo those less than desirable opportunities and provide you a competitive advantage in the areas you have identified.

Here are a few specific suggestions that may help smaller companies compete with the Big Guys:

1. Be Agile

Large construction companies typically standardize their services, and in many instances these services are rigid and pricey.  On the other hand, as a small company you may be hungry for almost any new business and can be more flexible in meeting potential clients’ needs.

You have the ability to make quick and firm decisions as opposed to the slow methodical bureaucratic processes that often paralyze larger competitors.  If you are able to be nimble while offering quality services, you may have just found a competitive advantage over the big boys.

2. Keep the Main Thing the Main Thing

Large construction companies probably have multiple service lines across the nation.  But you as a small business do not – nor do you need to.  Focus on developing excellence in your main line of service.  Focus on being the “best of the best,” and this may be just what you need to outshine larger competitors.

3. Shoot for the Bull’s-eye

Understand who your potential customers are, how you can reach them and most importantly how you can meet and solve their challenges.  Focus on defining, identifying and hitting your desired target!

4. Go After the Middle Markets and Under-Served Customer Segments

There are far more middle markets and under-served customers than there are big ones.  In fact, most of us have a tendency to focus on the sexier large customer and discount the smaller ones.  Many times this is precisely what larger competitors do, with little regard for the second and third tier customers.  Do your homework and find the diamonds in the rough.

5. Think Global and Act Local

The more you understand the Big Picture (so the speak) of the construction industry, the more creditability you will have with current and potential customers.  Take this wide industry knowledge to your local market, demonstrating your ability to bring larger industry dynamics to solve the problems of regional and local customers.  In short, stay current on issues and trends affecting our industry.

Now, this will not prevent the Big Guys from trying to eat your lunch.  However, it is not about them; it is about you developing and focusing on your competitive advantages!

Lloyd Facen is Director of Business Development with Triune, a leading integrated design-build general contractor founded in 1997.  Triune is headquartered in Dallas, TX – www.tmvllc.us

The Punch List is Triune’s proprietary blog for discussing issues and providing insights specific to the commercial construction industry. Copyright 2013 TMV, LLC (Triune). Any and all rights reserved.

Vince Fudzie – the blogger’s Reality Bite:  Lloyd has made some good points based on his experience working for both behemoths and smaller companies.

The main point I want to add is that you must recognize and believe that you can compete with larger competitors. You need to make a concerted effort to identify those areas where you can compete and then implement them.

 

The Real Cost to Fill a Position May Be More Than You Realize

The Real Cost to Fill a Position May Be More Than You Realize

The Real Cost to Fill a Position May Be More Than You Realize

By Traver Hill

In the hiring process, the concept of “time=$” is often overlooked.  Most companies begin the hiring process by first calculating the compensation package.  However, the actual cost of hiring begins to accumulate long before the new hire’s start date.

It’s a labor-intensive process that’s often ignored when determining the cost to source, evaluate and hire a new employee.  For small businesses, the cost can be significant.  Below are a few points to consider when you begin a search.

Post a Job: Today’s technological advances offer a number of sources for posting an ad.  Most successful small businesses look for efficient low-cost channels to find candidates.

  • Writing the ad and completing one post can take 1 – 2 hours, which equals $25 – $50 (assuming for our simple example that the employee total burden is $25 per hour).
  • Posting the job online can cost as little as $25 on Craigslist or as much as $375 on Monster.com.

Reviewing Resumes: Most large corporations utilize a third-party tracking system to prescreen applicants.  Small businesses typically cannot afford to dedicate resources to such a system.  Often, this process is performed by multiple employees within the organization.

  • Recent reports suggest most employers will spend up to 10 minutes or more reviewing each resume.  The level of response you receive will dictate the amount of time it takes to get through this process.  In this case, let’s assume 75 applicants responded.  It can take up to 12.5 hours to complete a review of all resumes.  The total cost would be $312.
  • Preparing a short list of candidates to contact can take from five minutes to two hours.  The total cost can range between $2 to $50.

Prescreening Candidates: Prescreening is necessary to eliminate inexperienced candidates, and there are few options to do this.  For most small businesses, this is accomplished through direct contact by phone.

  • Let’s assume out of 75 candidates, eight were selected to be prescreened.  Each call will last about 15 minutes.  The total time it takes to prescreen all the candidates is two hours.  The total cost is $50.

Interviews: Once the prescreening is complete, the actual interview process begins.  Although technology offers alternative methods to conduct the interview, most companies still use the face-to-face method.

  • According to the Society of Human Resource Management (SHRM), the average interview will take 1 hour to complete.  Assuming five of the eight candidates prescreened are scheduled to be interviewed, the total time to interview all candidates is five hours, and the total cost is $125.  This cost will typically be higher if multiple people from your company interview the candidate.

Closing the Deal: This is the wrap-up phase of the hiring process.  All miscellaneous items are complete and the final phase begins.

  • Analyzing the candidate’s interview responses and determining the final selection can take up to two hours.  The total cost would be $50.
  • Scheduling second interviews is not necessary in all cases, but may be required in certain instances.  The total time can be 30 minutes to one hour. The total cost can be $12.5 to $25.
  • Calling references to get an enhanced picture of each candidate’s character and work ethic is a prudent practice. The total time can be one to two hours. The total cost is $25 to $50.

Many companies, large and small, do not consider these costs before they begin the search.  When all is said and done, the true cost to successfully acquire a qualified employee is much more complex than simply the cost of a job posting.  My advice to you is that once you hire a competent and loyal employee, do all that you can to retain that employee.  As the old saying goes, “it is cheaper to keep her.”

Traver Hill, is the Vice President of Operations for Triune.  Founded in 1997 with headquarters in Dallas, Triune is a leading, integrated design-build General Contractor in the Southwest region of the country. Traver is a multifaceted career professional with over 20 years experience in Human Resources and Operations.

The Punch List is Triune’s proprietary blog for discussing issues and providing insights specific to the commercial construction industry. Copyright 2013 TMV, LLC (Triune).  Any and all rights reserved.

 

Four Things To Look For In A Construction Accounting Solution

Four Things To Look For In A Construction Accounting Solution

Four Things To Look for in a Construction Accounting Solution

By Wesley Middleton

“Only two things in life are guaranteed,” right? The first we’ll leave for a day when you’re feeling a bit more philosophical. With a new tax year just around the corner, the second could use some attention now. Taxes affect all of us, personally and professionally, so knowing that they are taken care of in the most efficient and effective manner is a must for your peace of mind and your business’s bottom line. Increasingly complex regulations and a competitive business environment make finding the right accountant a vital business decision.

What can the right accountant, one who works with you on a consistent basis, do for you and your business?

  • Protect you and your business with routinely scheduled audits
  • Support growth by helping you win more business
  • Ensure you are optimally positioned for underwriting
  • Inform your company of relevant changes in legislation
  • Check for compliance, saving potentially thousands of dollars in financial penalties

Choosing the right accountant or accounting firm is a big decision. It can also be a daunting one when you’re not sure where to look – or are simply overwhelmed by the number of options. With that in mind, we’ve simplified the search for you. Read on for four important things to consider when evaluating your accounting services options. (Note: You might have an inside accountant who deals with bookkeeping and related functions; this article considers what you might look for in an outside accountant or firm.)

1. Certifications

While the accountant who keeps track of your bookkeeping doesn’t necessarily need to be certified, it’s a good idea to choose a licensed or certified professional to prepare your returns and give you tax advice. So, what are the distinctions?

A Certified Public Accountant (CPA) has an undergraduate degree in accounting and meets exam requirements for state certification, in addition to taking continuing education courses. CPAs might have additional designations, including Certified Valuation Analyst (CVA), Accredited in Business Valuation (ABV), and Personal Financial Specialist (PFS). Depending on your needs, you might look for someone with these designations. You’ll also want to look for a CPA with construction accounting experience, as we discuss next.

2. Industry Expertise

Industry expertise is vital in the accounting arena, particularly for the construction industry. Rules and regulations are constantly evolving and you need someone who stays informed on these changes and understands how they apply to your business. Someone who attends events like the AICPA Construction Industry Conference will be able to advise you on recent changes within the industry.

Increased regulatory complexity, as related to areas like tangible property, makes navigating the industry’s accounting functions difficult, so look for an experienced professional. Something as simple as terminology can vary greatly from industry to industry, and construction accounting has specific vocabulary associated with its functions. Your accountant needs to have a deep understanding of your industry, from the terminology to the contract lifecycle, revenue recognition, the WIP schedule, and over and under billings.

3. A Smart Team

When looking at accounting knowledge, it’s not always about an individual accountant, but about an accounting team as a whole. One person can’t know everything, so you might consider looking for a team of experts rather than one individual. Look for a firm with some diversity on their team in terms of specialties; they’re more likely to be able to help across all accounting functions you need – from business tax to personal tax planning.

4. A Proven Track Record

As with any business decision, it’s a good idea to ask for references. Better yet, ask others in your networking circle for recommendations. They can help narrow down your initial search or provide valuable insight about how to evaluate potential accounting solutions (ask about the good and the bad experiences to know what to look for or avoid).

A Final Note: The Importance of Communication

Technical and industry expertise are vital. But so is communication. The biggest firm isn’t necessarily your best bet. Look for an accountant or accounting firm who respects and embraces your communication style and who you feel comfortable working with closely, one who takes the time to understand your business and who answers the questions you have. When evaluating your options, ask yourself if you’re comfortable with the level of communication and interaction the CPA or firm is willing to provide.

Wesley Middleton is the Managing Partner at MiddletonRaines+Zapata, LLP, a leading Houston-based CPA firm offering a full suite of accounting, tax, audit, and consulting services to the small and middle markets.

The Punch List is Triune’s proprietary blog for discussing issues and providing insights specific to the commercial construction industry. Copyright 2013 TMV, LLC (Triune). Any and all rights reserved.