Many local businesses struggle to find legal advice for their unique situation, so today on The Legalpreneur Podcast, I take you step by step through the process of legally starting your local business and break down how to safeguard yourself against lawsuits.
The requirements for a local business are different than what is required of a national online brand. First, you need to establish if you need local or federal protection. To qualify for a federal LLC you must be doing business in multiple states, which in most cases is beyond the scope of a local business. Generally, a Local business only needs local protection.
Once you’ve determined the geographical range of your business, check in with your local authorities to determine the requirements in your area. Details as small as your local return policies can make you vulnerable to a potential lawsuit. You can avoid these common mistakes with a Legalpreneur membership that will give you all access to an attorney who can help you file your LLC, DBA, and everything you need to legally protect your local business!
Key Takeaways:
[1:30] Local businesses are in-person services or traditional brick-and-mortar business
[3:23] You do not need to incorporate your local business, the best option is an LLC
[3:45] Deciphering if you need a DBA and an LLC for your local business
[4:25] Any business website needs a privacy policy and terms of conditions
[5:30] You can print the terms of conditions on the customer receipt
[6:11] Verify what the return policy of your state is before you state no returns
[7:25] Check with your county and state for the proper licenses
[9:00] To qualify for a federal trademark you need to be doing business in multiple states
[10:45] The Legalpreneur membership gets access to an attorney who can file for you
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Disclaimer:
The Legalpreneur Podcast is advertising/marketing material. It is not legal advice. Please consult with your attorney on these topics. Copyright Legalpreneur Inc 2022
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Legalpreneur transcript:
Andrea Sager 00:03
Welcome to the Legalpreneur podcast. I’m your host Andrea Sager founder and CEO of Legalpreneur Inc. As a serial entrepreneur and someone that works exclusively with small business owners legally protecting their business. I’m dedicated to covering common legal issues faced by business owners, providing you with the business knowledge you need to catapult your business’s growth and showing you just how some of the world’s most elite entrepreneurs have handled these legal and business issues themselves. In true attorney fashion, the information in this episode is not legal advice. This is for informational purposes only. And you should always consult with your attorney before implementing any of the information in the show. Hello, there
Andrea Sager 00:46
Happy Monday. I hope you’re having a wonderful, wonderful Monday after hopefully a great weekend, I had a pretty chill relaxed weekend. And today I’m really excited to chat about local businesses, also known as brick and mortar businesses, I use the terms interchangeably. But basically this means if you do business in person and not online, that’s what we’re talking about today. Before we get into it, I want to make sure that you know that the Legalpreneur book is officially out it is on Amazon, Barnes and Noble things you can get it on target.com. Basically, anywhere you buy books online, you can get the Legalpreneur book. And I’m so excited because we are actually doing really well with sales. So last week, we were in Austin for the deal day with Oracle, the NetSuite accelerator we’re doing and getting ready and preparing the pitch deck. We wanted to show how well the book was doing. And I found a stat that said self published authors average 250 copies like sales for the lifetime of the book in three weeks. So we’ve had about 1200. So I’m super bummed. super grateful for all of you, anybody that has purchased I can’t thank you enough. Anyways, getting into legal protection for brick and mortar businesses, also known as local businesses. First of all, what exactly is a local business or what exactly is a brick and mortar business? This is somebody that either has a physical location, so a brick and mortar basically literally bricks, bricks and mortar.
Andrea Sager 02:17
That’s how you have the local business. It’s in person, you have a storefront. That’s a brick and mortar business and local businesses, you don’t necessarily have to have a brick and mortar, you could be a service provider that travels to other businesses or individuals. So if you’re an electrician, you’ll probably travel to whoever you’re doing the work. Same for plumbers same for if you have a boutique and you do shows you don’t have a brick and mortar location, but you sell in person. So that’s who I’m talking to today. There’s so many others that this refers to. If you do party Event Rentals at moonwalks, the bounce houses, I’m just trying to wrack my brain. But if you do business in person and not online, this applies to you. Now, what exactly do you need when you have a local business because it is different than online businesses. And I the reason I wanted to do this episode is because I feel like a lot of times I’m mainly talking specifically to online businesses. And so I wanted to make sure I am specific and cover exactly what you need when you have a local business or brick and mortar business. Now, first things first, doesn’t matter what kind of business you have, you need an LLC, the LLC, hopefully you know by now it’s a limited liability company.
Andrea Sager 03:30
And this protects you personally from the debts of your company. I don’t care what your accountant says I don’t care what your BFF who said something on Facebook, I don’t read something on Facebook, I don’t care what any of them say you need an LLC. The only time you really want to think about a corporation is when you are going to have investors investors will basically require you to have a Delaware C Corp. But when you are a solo or a small business owner, LLC is the way to go. You get that liability protection without the extra fees and maintenance of a corporation. You also may need a DBA doing business as and if you filed initially a DBA and you file an LLC, you may not need the DBA. Again, the DBA is to signal to your county, hey, I’m doing business as this name. So if your LLC is ABC, but your how you’re doing business is XYZ, you would file a DBA with the name of XYZ and that DBA will be owned by the LLC, not you as an individual. So always always you need an LLC Next, if you have a website. Even if you have a local business or brick and mortar you still might have a website you still need a Privacy Policy and Terms and Conditions. No matter what kind of business you have. If you have a website you need Privacy Policy and Terms and Conditions. If you need templates, of course go to the contract vault.com
Andrea Sager 04:57
The link is in the show notes and you can get a bundle of con tracks for one, I mean, nine depends on what your niche is, we just sell them in different bundles, but you can get all of them for 199. Now contracts, this will depend on what type of business you have. Because if you have a retail store, you’re going to not going to have them sign a contract. And it’s actually so the contract actually isn’t the receipt when they pay with a credit card. That’s just the payer, the buyer signing for the credit card company, that actually doesn’t mean anything for you. Now, when you have this retail store, you want to make sure they are aware of the terms when purchasing and if you depending on what point of sale system you use, you can put the actual terms of purchase on the receipt, any good reputable POS point of sale. Least always losing POS. So my ex husband, whenever we had our store, the point of sale system, any reputable one will allow you to put the terms on the receipt, because you want to make sure that the buyer is aware of the terms if there’s no returns all sales final make sure that’s on the receipt or and posted throughout the store. Keep in mind, some states do have a law that requires a certain period to return things, some states have three days, some states have, I think, like 21 days, some states don’t have it at all. So you want to make sure you’re aware of what the rule is in your state. Because if you try to say all sales final no returns, guess what they can still return it if the state says they can. Now if you are a service provider, your plumber, electrician, whatever you’re doing, and you do Party Rentals, you always want to make sure you have somebody sign a contract, especially if you’re performing work without payment and you collect payment later. Or if I mean, I always suggest getting payment up front before any work is completed, I know everybody’s different.
Andrea Sager 06:50
So just always make sure there is a signed agreement, even if they’re not paying right away, if they’re not paying right away, you should absolutely have a signature before starting the work. Now, in addition to these things above, depending on what type of business you have. And this goes for all businesses, even online businesses, but you will want to check with your local county and with the state for any additional licenses. Every state every county is different. So I can’t say Oh, in this county, you need this or in the state you need this. Every single one is different for every single type of business. So you always want to make sure you have the proper licenses in order to be doing business the right way. So add that to the list. Now one thing that I haven’t covered is IP, intellectual property. No, no, this is my favorite. So IP concerns for local business, trademarks, this is your brand brand identity, copyrights. This is your content, copyrights, you automatically have protection the moment the work is created.
Andrea Sager 07:51
So in your business, if you are creating a lot of copyrights, you do have protection automatically, you don’t have to follow the registration. And that’s why copyrights are such a big concern for online businesses, because typically, they’re informational businesses. And they’re you’re creating a lot of content for local businesses, you may not be creating as much content, maybe photos videos, but keep in mind, you do have copyrights, and you do automatically have protection. But if you want to learn more about copyrights go back a few episodes, I did a full episode on everything you need to know about copyrights. However, on the other hand, we have trademarks. Now, for the most part, when I talk about trademarks, I’m talking about federal trademarks getting a federal trademark registration. In order to be eligible for a federal trademark, you have to be doing business in more than one state in in order to be doing business in more than one state, you have to have clients in more than one state. So if client if you’re advertising in more than one state and people are traveling to you, that does qualify as more than one state. However, if you just have a local store, and you don’t even do any advertising, it’s just drive bys word of mouth, then you may not be eligible for federal protection, you probably still are eligible for a state trademark. But keep in mind, it is not as powerful as a federal trademark. If a client is eligible for federal trademarks, I never tell them to go the State Route.
Andrea Sager 09:14
Honestly, it is a waste of money unless you’re not eligible for a federal trademark, or for some reason you just can’t get the federal trademark than a state trademark is worth it. So keep this in mind. If you have a local or brick and mortar business, make sure you are aware of what intellectual property you have and how it can be protected. Because if you only have I see this all the time when you have a local store, and people still file a federal trademark application, but they’re actually not eligible. So you kind of I mean, I mean, he did waste the money, but you want to make sure that you’re filing either at the right time when you actually are eligible or you just skip the federal route and go the State Route. Now. That’s for the most part all the legal concerns for local and brick and mortar businesses. If you need Help. If you have questions. Don’t forget about the Legalpreneur membership. We help online businesses, local businesses, brick and mortar businesses and any business, we get you all access to your own attorney. And this gets you literally everything you need to be legally protected. We cover your LLC, you just have to pay your state filing fees.
Andrea Sager 10:19
It has unlimited emails, document review, phone call, every month, all of our contract templates are included with the contract vault, you don’t get just one bundle, you get all of them and you get a free trademark search, you get a free business audit, there’s a lot of things that are included in the membership, it’s really that peace of mind you need to grow and scale your business. For some reason, we’ve been having a big increase in memberships lately, I think a lot of people just really starting to see the value in having their own attorney and one of the benefits that people love the most is just see seeing their attorney. So a lot of times and I know we’ve all been there where we threatened like I’m gonna have to get legal counsel involved. So many times clients come to us telling us a situation where like just CCS and say, you know, hey, we don’t have payment by the state, then you’re we’re gonna have to bring in our attorney, blah, blah, blah, or actually one of my favorites. The girl was like, I’m gonna have to get my attorney involved. And the client responded back she said, No problem. Our attorney is CCD here, have your attorney in contact our attorney, and everything taken care of. So anytime there’s situations come up, it’s always fun because people want to threaten and don’t think you’re going to call their bluff on having an attorney. But you can have an attorney for $349 a month, even less if you pay annually. So in the links in the show notes, let me know if you have questions, and I will see you next time.
Andrea Sager 11:40
Here at Legalpreneur, we’re committed to providing a supportive legal community for all business owners. I know how scary the legal stuff can be. If you found this information helpful, I would be so grateful if you could share it with a fellow business owner. And quite frankly, it doesn’t cost anything to rate review or subscribe to the show. Your support helps me reach more listeners, which allows me to support more business owners in their entrepreneurial journey. Have any questions or comments about the show? Feel free to drop me a line on Instagram. I promise I read all of the messages and comments. And if you want to be a guest on the show or know someone that would make a great guest simply fill out our application form and a team member will reach out if we think it’s a good fit. I’ll see you in the next episode.
