Small business disputes are legal disputes that arise in the setting of a small business. These tend to involve very specific legal issues when compared to larger businesses and corporations. Small businesses tend to have unique needs on account of their tighter focus and specific financial budgets. Some small business disputes include:
- Debt collection and resolution
- Tax issues, accounting problems, financing, and loans
- Disputes with customers or clients
- Disputes with other competing businesses or with partnering businesses
- Regulatory conflicts with government agencies
One common area of dispute is that of contractual breaches. Contracts often play a big role in small business operations, and breached contracts can lead to lost profits and legal claims.
How Are Small Business Disputes Resolved?
This depends on the type of dispute. For statutory, governmental violations, a business may need to pay fines, or they might have their license suspended for a period of time. An example of this is when a business establishment sells alcohol to minors.
For disputes with customers, many small businesses will remedy the situation through a warranty document or through human resources department strategies. For instance, they may offer compensation to a client, or the client may owe the business compensation (depending on the facts).
For disputes with other business entities, legal action may be necessary. This is especially true for contract breaches and other highly complex legal issues. In some cases, business mediation may be available to help the parties reach a conclusion out of court.
How Can Small Business Disputes Be Avoided?
You also need to pay close attention to debt collection for small businesses. Many small businesses operate with a limited clientele base, and a small number of business partners or affiliates. If a client or partner gets into debt, this needs to be handled carefully and with tact. You want to ensure that you’ll get repaid without sacrificing your network connection with the person or group.