Starting your first business is a thrilling experience, from concept to reality, it can be a surreal and often overwhelming undertaking. As much as it is a creative process, it is also a legal one, so you should be sure to have everything you need to start out as smoothly as possible.
Follow along as we explore five of the most-used documents by small businesses and why you may need them.
- Business Plan
A Business Plan is a document that entrepreneurs can use either before starting a business, or after to evaluate goals, budgets, and marketing initiatives. It outlines things like whether you will hire employees, where your funding is coming from, and what the hierarchy of the business looks like.
It also contains a SWOT analysis, which is something you can use to alter or define your marketing plans, identify your competitors, and weigh new ideas, products, or goals.
While a Business Plan isn’t binding, it’s a great way to keep everyone involved on the same page in regards to the future of your company, both in the short- and long-term.
Business plans can also be used to present give potential investors a solid idea of where their money will be going and how viable your business idea is.
- Consulting Agreement
Chances are that as a new business owner, you’re going to need some support. This might mean someone to help out with a single task like designing a logo, or a casual contractor to help out more regularly, such as a social media marketer or accountant. A consultant is someone that works for you on a per-project or contract basis as opposed to an employee.
A Consulting Agreement is what outlines your professional relationship with a contractor, including fees and payment, responsibilities and expectations, and more.
Any small business owner or startup founder looking for a freelancer should be sure to outline the terms of the relationship with a Consulting Agreement to ensure that both parties understand what is expected.
- Employment Agreement
Alternatively, an Employment Agreement is what you use to define an employer/employee relationship as a business owner. If you’re ready to take on the responsibility of a full- or part-time employee, you can use an Employment Agreement to get started.
Don’t forget that you’ll need to figure out things like deductions, employee benefits, and more, as well as completing an agreement between you and your future hire.
- Confidentiality Agreement
A Confidentiality Agreement is what you use to ensure that no employees, contractors, or other businesses share private information about your company with anyone else. It helps to protect your ideas, trade secrets, marketing and advertising plans, and more.
A small business owner may need one when exploring a partnership with another business where information about customers or profit will be exchanged, new employees or contractors are hired, or when exploring whether or not to purchase or sell a business.
- Invoices
If you’re offering products or services, you’re going to need to provide invoices to your customers and clients as a proof of purchase. The best invoices include:
- Contact information for both parties.
- An invoice number and date.
- Details about the amount due, including taxes.
- An outline of the tasks that were performed.
Not only should your clients and customers receive a copy of their proof of purchase, but you should retain one for your records as well.
Starting a Paper Trail
As much as paperwork can be less exciting than choosing your logo colors or picking your tagline, it’s a vital aspect of running a successful business. While marketing and sales help to keep customers interested, having the right documents and forms is what keeps your business running smoothly, both now and in the future.
Brittany Foster is a Marketing Writer for LawDepot—the leading publisher in do-it-yourself online legal forms and contracts.