Bad Business Habits

I was fascinated to read Emma Wimhurst’s article in the Independent small business section. Her views are, to say the least, controversial:

"We’re all fed up with the R-word, but I believe the economic downturn has done many business owners a favour. It’s grabbed us by the profit margins and warned us to make changes to the way we do things, or else. It’s been a positive motivator. So why isn't everyone listening?

"Many businesses have tumbled into debt or closure and plenty are struggling. If you had business issues before the downturn you’re probably working for someone else now or on the dole. You may have used the R-word as a convenient excuse, but I would argue there’s only one reason for failure – bad business habits."
 
Wow – sock it to us, Emma! I certainly don’t agree with all she says. Whilst I agree that any business with fundamental issues is unlikely to survive the recession, many are suffering through no fault of their own – it’s a simple matter of their market having collapsed.

However, she did set me thinking about the kind of bad business habits we see as lawyers. I asked the team and we came up with this top 9 – do you have any to add?

Bad business habits we see as lawyers:

1.  Failing to deal with bad debts effectively when it’s a small amount, and getting mad when the debt grows.
2. Letting little niggles (between staff, management or directors) turn into full blow disputes by not biting the bullet and tackling the problem right at the start.
3. Failing to get things in writing – especially details about new customer orders.
4. Employing people without a proper written contract of employment.
5. Using standard terms of business for complex contractual matters.
6. Ignoring rent review dates or opportunities to save money on property.
7. Burying your head in the sand! When things are going wrong financially, with customers, suppliers or staff, it’s common for business owners to ignore them and hope they’ll go away.
8. Relying on the advice of well meaning amateurs, when real expertise is required. This is just as true in relation to getting a professional website online as it is in terms of legal advice.
9. Naivety – at least I think that’s the kind way of putting it: ignoring rules, legislation and regulations when you know you’re going to have to comply to keep trading

Gary Cousins
Business Lawyer with a few bad habits!