3 Tips To Reduce The Risk Of Litigation For Businesses

For businesses, litigation is that one thing that they hope they never have to deal with. It is expensive, time consuming and could potentially be unflattering to one's reputation. It can also have a negative impact on employee morale. Litigation can take months, if not years, to truly recover from. Therefore, businesses need to take steps to reduce the risk of litigation.

Tip #1: Put Agreements in Writing—and Sign Them

Regardless of who it is that you are doing business with, even if it is member of your family or a close friend, make sure that all business agreements are put into writing. On top of that, make sure that the agreements are read in full and that all parties involved sign the agreement. Without a written agreement, any business-related terms that are discussed between you and the other party can be "forgotten" or changed and they cannot be legally enforced.

Tip #2: Keep Clients and Suppliers Informed

As a business owner, it is important that your clients and suppliers are kept properly informed about what is going on inside the business. This will help them prepare in the event that something changes with shipments, timelines, etc. For example, if a piece of your machinery happens to breakdown during the middle of production and a shipment of products are going to be late, send an e-mail or make a phone call to your client to inform them of what is going on and provide them with a new expected date of arrival. In all honesty, this is simple courtesy in business. Think of it this way: if you were on their end, wouldn't you expect to be informed?

Tip #3: Don't Ignore Problems or Complaints

If you ignore an issue within the company (whether with machinery or an employee) or a complaint from a customer, you may find the problem quickly escalating. If you ignore an issue, you will be unable to solve it. Many people think that ignoring something will make it go away but; however, in most cases, this simply makes the problem worse, especially in business. By working to resolve issues as they arise, you will show the other parties that you actually care that they are having a problem with your company. This will help build trust with them as well as the rest of your customers (and potential customers), not to mention that it will help to avoid loss. This same motto remains true with anything what is happening within the company, such as with your employees or machinery. 

For more information or assistance, contact a local commercial litigation attorney.