Like insurance, it's the kind of expense that no business likes paying for. Whatever you're protecting yourself against might never happen and it's money that could be spent on something tangible, like products and premises.
But the legal structure of a business, however small, is part of the foundations that keeps it standing. Build it on straw and it's likely to blow away at the first sign of stormy weather.
However, the behemoth that was the legal world has been apprehended by the 21st century and is undergoing a degree of change that is very good news for the small business community.
The advent of the virtual world has allowed many business sectors to operate without the need for overheads such as costly premises - and the legal world is no exception. This is the premise behind Virtual Law, a new legal advice service that operates remotely so that clients pay for high quality advice at the right price.
There are a number of vital issues that need to be established and protected by law before trading starts: choosing a name for the business is one of the most important decisions to be made - a well-chosen name can make all the difference to success or failure - but if it's that good, someone else could challenge ownership if it's not legally yours or worse; you could find it already belongs to someone else.
Equally important aspects to establish in a legally binding way are protection of intellectual property rights, patent applications for technology,
The legal structure of a business, however small, is part of the foundations that keeps it standing
Perhaps most relevant of all in the current financial turmoil is employment law. Falling foul of any legal issue is stressful and potentially disastrous for business but ending up in a conflict situation with an employee with a grievance can be traumatic. Even if your employees start of as friends, it's essential that the relationship has a legal footing. It's an unfortunate fact that many a small business that has started off on a handshake with an old friend on board has ended in court.
Because of the easy exchange of information via the internet, all these services can now be sourced at a cost that is realistic for a new business. This process beings a much-needed transparency to the issue of legal fees that lays bare the reality of where the money is really going.
Virtual Law is a recognised body and like other private practice law firms is regulated by the Solicitors Regulation Authority. However, that is where the similarities end. There's no expensive City office - a large overhead often paid for by clients themselves - with meetings taking place at clients' offices, saving the client valuable management time which could be better used actually running their own business.
Whilst Virtual Law has a relatively small in-house team it commonly sub-contracts work to network of consultants or ‘virtual lawyers', which includes practising barristers and ex-partners of City firms.
But cost isn't the only benefit to clients of this technological advance. A more fundamental upside is that since the majority of Virtual Law's lawyers have business experience in the real world (ie outside private practice firms) they are usually more commercially aware and astute than their private practice counterparts and have a better understanding of the non-legal pressures that may be involved in a given situation.
This revolution in the legal world the benefits has benefits to small businesses who require legal advice, but who find cash flow tight in the current economic climate.
Olive Brice is a partner of Virtual Law. For more information visit www.virtuallaw.eu
