Small Businesses are not Small Versions of Large Businesses
Small businesses are not just large businesses with a few zeros lopped off the end of their balance sheets. Small businesses are unique.
First of all, from a purely legal point of view, small businesses don't have the same regulatory framework. Although many laws apply equally to any size business -- like wage and hour laws, some regulations only come into play once a company has over a certain number of employees -- like some family and personal leave regulations.
But more importantly, it's difficult to compete with large businesses unless you use some uniquely small business related advantage -- agility, personalization, responsiveness. There are tons of books on how small businesses compete. Just search on "how small businesses compete" on Amazon. But from a legal advice standpoint - what can a small business do to leverage it's unique advantages?
First and foremost, realize that legal advice is really about risk management. No attorney can risk-proof your business. If you want a risk-proof business, don't quit your day job. What attorneys should do is provide you, the owner and decision maker, with a risk analysis. If you do A, X might result; if you do B, Y will likely occur. Let me give you an example.
My blog is full of discussions about using independent contractors (ICs). I can often give a business owner a pretty accurate idea of how likely their use of a particular group of ICs is to cause legal and tax problems. The risk may be 25%, 50% or 90%. But sometimes using ICs to get started is worth the risk. And that's where the business owner comes in to make that risk assessment decision.
Many attorneys who are used to large businesses, which usually take a more conservative path, will not give their clients any option. This is not only because they are used to their larger clients. It's also often because they are afraid of their own liability. Although business law advice is an art, and it's hard to second guess a lot of it, the fact remains that professionals have less personal risk if they offer only the most conservative advice.
But I believe the business owner should be given information and that owner should choose the level of risk he or she is willing to accept. I dont' believe in taking away that decision making power.
I try very hard to give my clients a wide range of options; to explain the pros and cons of each option; and to provide a risk assessment for each option. I then try to stand back and let the client choose.
This allows a small business to use all of the advantages of being small.
