Small businesses are often a labor of love for their owners. They require a massive commitment of time and energy to build, nurture, and grow, but along the way, small businesses can get caught in a wide variety of legal quagmires. Understanding these risks, and knowing how to prepare for and mitigate them, is key to avoiding time- and resource-consuming legal disputes that can hinder or even ruin a business. Legal risks of small businesses could fit into seven very broad categories:
1. Maintaining a Safe and Secure Premises: Brick and mortar businesses may encounter claims from customers or others injured by an unsafe condition on business property, such as a broken step or a spilled substance on the ground. Regular maintenance of the premises, along with liability insurance, can mitigate this risk.
2. Consumer Complaints: Businesses that do not promptly respond to customer complaints about products or services may encounter legal claims. Customers should receive prompt responses to reasonable complaints or concerns.
All advertising and marketing materials must accurately portray the company's products or services, in order to avoid deceptive trade practice claims.
Robust quality control may help a business avoid putting faulty or defective products into the marketplace. This can help companies avoid product liability claims.