Our event, Obamacare and the Small Business Owner: What You Must Know Now, will now take place on Thursday, November 21st at 10:00am at the Transfer Station East in Manayunk. The Transfer Station East is located in the old Restoration Hardware space at 4120 Main Street. There is ample parking onsite and nearby. This event is free and includes coffee and pastries, but registration is limited and must be done in advance here.
If you own a small business and are confused about your health care obligations, please come to this event. See you on November 21st.
One area where many small business owners skimp on legal advice is with their commercial lease. If you're not careful and do not have a lawyer review your lease, you could be in for years of problems.
Most commercial leases are for a long term, typically three, five, ten years or more. One area to keep an eye on in your lease is the amount of rent. Sounds easy, right? You find a nice space that advertises itself for $1,000 per month. You get excited, run your numbers and decide your business can afford to pay $1,000 a month in rent. Not so fast. Look closely at the area that discusses the rent charges. Typically a lease will specify the amount of base rent to be paid and then there will be additional paragraphs that address additional rent. What is included in additional rent? A large number of things, depending on your landlord. Use and occupancy tax could be added, utilities, past due charges, many items might be specified, make sure you understand how much will really be added to the lease each month. If you aren't comfortable with the arrangement, negotiate!
Another area to closely watch is for any rent escalation clauses. As I pointed out above, a commercial lease is usually for a long period of time, several years or more. Do you think your landlord is okay with you paying the same amount of rent for five years or more? Think again. There is likely a rent escalation clause in the lease specifies what the base rent will be in years two, three, four and five. Make sure the exact amount is noted, along with the exact dates of when the new base rent rate applies.
I am an attorney that reviews commercial leases for a very reasonable rate. It's money well spent to make sure you are not placed in a bad position today or several years down the line when you are locked into an unfavorable lease. Drop me a line today about reviewing your commercial lease.
Despite the popularity of a certain song, blurred lines are not always a good thing, particularly in business. In the management of a business, clarity is key. What sort of things need clarification? The basics: who, what, when, where and why.
Who: who is involved in your business? What is his/her role? When entering into a business relationship with anyone else, whether that person is a friend, family member or spouse, clarity is key. Write everything down: the responsibilities of each person, the expectations and key accountable tasks.
What: what is your business? Selling goods? Providing services? A blend of both? You'd be surprised by how many people can't really clarify what exactly their business is about. They know they want to sell things, but they also want to dabble in this or that and the other thing. Know what your business is, who it serves and write it down. Stick to it. At least for awhile.
When: what are your deadlines? What are your goals? When do you want to achieve break even? When do you want to be profitable? Know these timelines inside and out and write them down to make sure you follow them.
Where: where will you conduct business? Where will you incorporate? Do you have a registered agent? Do you know what a registered agent is or why you might need one? Make sure you can answer these questions.
Why: why are you in business? To help people? To change the world? If you are starting a for profit business the only answer to this question (at least initially) should be TO MAKE A PROFIT. Some people think this is harsh, but think about it: how can you change the world or help people by running an unprofitable business? You can't, because you'll be out of business in no time. It's great to have noble objectives, but don't forget that you must turn a profit to keep your business going.
Remember: clarity is key...no blurred lines.
Sarah E. Holmes is a Philadelphia business attorney and strategist that helps start ups and established businesses looking to expand, protect their assets and increase their profits in an approachable, down-to-earth way. When you're looking for a business lawyer in Philadelphia, the Main Line or New Jersey, we can help.
Holmes Business Law, P.C.
1515 Market Street, Suite 1200,
Philadelphia, PA 19102
40 E. Montgomery Avenue
4th Floor, Ardmore, PA 19003
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