For many, the two most intimidating of the eight business fundamentals are financial and legal. Business owners get stuck in a pattern of doing things the way they’ve always done them, with the attitude of “good enough is good enough.” Couple that with the desire to avoid the expense of talking to an attorney or a CPA, and after a while you are routinely stepping over a dollar to pick up a dime, as the old saying goes.
Sometimes the catalyst that can get you out of this rut is talking to a knowledgeable advisor, one who can tell you at a glance which aspects of your business should be reviewed by an attorney or accountant. Eagle Corporate Advisors has fulfilled that role for many successful businesses as they sought to grow.
We can provide that edge you need to outperform competitors and renew your enthusiasm for all aspects of your business. Our job is to put you on a faster path toward your goals in business and in life.
GPS: Fundamentals: Financial & Legal
Everything in a business has a dollar amount attached to it, and whether they are coming or going, those dollars need to be reliably tracked. Likewise, businesses need agreements with all the various players involved in moving said dollars — employees, vendors, landlords, banks, and, of course, clients.
Keeping good, clean financial and legal documents in place is not a one-and-done task. It’s much more than just having a folder of receipts or signed contracts. Your business should have qualified people create these documents or records, put them in place and review them on a timely basis. To ensure the ongoing stability of your operations, never rely on handshake agreements with vendors or other associates. You should not do anything “on trade,” as this leaves both parties ignorant of the value of the transaction.
Adhering to this standard for legal and financial matters also creates consistency across the board in how you treat customers and vendors. Standardized contracts and forms provide a good record for past transactions as well as a roadmap for future ones. This benefits your team members, who can feel like they are on solid ground when dealing with past, present, and future clients.
Being fundamentally strong in financial matters is the bedrock upon which you can build legal stability. Clean financials allow you to get loans and be cognizant of what taxes, fees, and dividends to pay in order to keep your business from sinking into legal trouble. Keeping these financial records clean from the start also means a smaller bill from an outside tax CPA.
Conversely, having solid legal structures creates financial stability. It’s easy to underestimate how important legally binding contracts are to your business — remember, they are the linchpin for every aspect of how your business moves dollars:
• Agreements with clients ensure they will pay you on time.
• Agreements with vendors mean your service and price are locked in.
• Agreements with employees encourage them to treat the job seriously.
Cutting corners by not involving a CPA or attorney might seem like an easy (and cheaper) route for the short term; yet in reality, it’s like setting small time-bombs ticking all over your business. Eventually, this avoidance leads to a cascade of exponential issues. We realize this fear of hourly billing is fairly common, and it’s one of the reasons Eagle utilizes a monthly retainer — we want clients to feel they are able to approach us without worrying about incurring costs by the minute.
If you want to grow, you must build your business on a stable foundation with solid financial and legal framework. There will, of course, be many parts of a growing business that require expertise from a professional that bills by the hour. Sometimes it’s not that a business owner wants to cut costs, it’s that they don’t have the knowledge yet about what aspects of their business require a CPA or an attorney. We can help guide you in that respect.
“The hardest thing to understand in the world is the income tax.”
A common refrain about wealthy individuals and big corporations is they manage to pay less in taxes. Why? It’s not because they understand every aspect of tax law — rather, it’s that they have the resources to tap into the best financial and legal minds for strategies on using tax law to their benefit. And they know it makes financial sense to dedicate resources to obtain this advantage.
The benefits don’t begin and end with taxes, either. Applying sound financial and legal strategy to every other aspect of a business will shore up areas of waste and maximize areas of profit. Spending money on necessary expertise from accountants and attorneys can fortify your business as it grows, paying you dividends for the entire life of your business.
For many business owners, financial and legal questions stay unresolved because they have been locked in a pattern of doing what they’ve always done. The thought of turning over that rock can become a source of anxiety and dread, preventing business owners from reaching their full potential.
No one person can run a business and also acquire all the knowledge necessary to approach every one of the business fundamentals as an expert. Chuck Mohler and Brian Mohler of Eagle Corporate Advisors have built their reputations by helping business owners identify which parts of their businesses might be underperforming, in order to create plans that will improve each area and raise up each business as a whole.