“If only I knew then what I know now” is a common refrain from clients who find themselves in disputes with their fellow shareholders, customers, suppliers, distributors or sub-contractors. It may be good for our business for you to make these mistakes, but we guarantee that it won’t be good for yours.
Here is our list of 10 mistakes that others have made – so that you don’t have to repeat them.
Mistake #1: set up a company without a constitution. For example, if you want the first right to buy your fellow shareholders’ shares, your company needs a constitution that includes that clause.
Mistake #2: set up a company without a shareholders’ agreement. Before you get started is the time to do it. Once you have started fighting with each other, it’s too late.
Mistake #3: draft your own customer terms and conditions. Really? Do you also service your own car and perform your own dental work?
Mistake #4: sign agreements without reading them. Ask yourself, did the person who drafted this contract have my company’s best interests in mind?
Mistake #5: start work for a customer without a contract in place. This is way too common. Get the contract signed before you start work. There isn’t a better time.
Mistake #6: lend/borrow money without a written loan agreement. Oh, so it was a gift was it? Or a loan that is repayable on demand?
Mistake #7: employ someone without a written employment agreement.
Mistake #8: launch a brand or product name without doing a clearance search. It’s going to be expensive to change all of that branding if you get a cease and desist letter from the trademark owner.
Mistake #9: get a “mate” to build your website/app/software without a written agreement in place. So who owns that intellectual property? Probably not you.
Mistake #10: supply goods on credit without registering a charge on the PPSR. If you have to ask what this means, it’s probably a good time to give us a call.