October 14, 2016 / como / 0 Comments
What’s so important about how I sign my name?”
I get asked that question all of the time from my business consulting clients.
I tell them that a better question to ask me is this:
“Who cares about how I sign my name?”
The answer is a simple one.
NOBODY.
FINE PRINT: Except… your customers and clients, your creditors, your bank, your mortgage company, your landlord, the I.R.S… oh yes… and anyone else that wants to SUE YOU (and don’t forget ALL their lawyers!).
As in many areas of the law, the exception to the rule swallows up the rule!
What do I mean by this?
Well, let’s start with some basics. For instance, if you’ve already formed a corporation or limited liability company (LLC), you may think that you’re already protected from personal liability in the event of a lawsuit against your business.
In general, the rule is that a corporation or LLC, if formed correctly, and if all of the formalities required under the law of the State where the entity was formed are followed, does protect you from personal liability for business debts and lawsuits.
FINE PRINT: Except… when you choose to do business as an individual, and not as the corporation or LLC that you initially formed.
You see, whenever you sign documents like contracts, purchase orders, contractual agreements, leases, loans, mortgages, promissory notes, and most other legal documents involving your business, you need to make sure that you sign your name only in your business capacity.
You MUST avoid signing your name in your individual capacity.
And how do you do that? It’s pretty simple. You see, the format that you use to sign your name is the controlling factor.
In many cases, you as the business owner, sign your name without knowing how to properly sign your name to business documents. In fact, most business owners of corporations and LLC’s still sign legally binding agreements in their individual capacity…and not as the business.
SIGN AS AN AGENT OF YOUR BUSINESS
If you have formed a corporation or an LLC, you must remember to sign all contracts, agreements, invoices, etc… as an agent of the business.
For example… Many business owners haphazardly, or perhaps inadvertently, sign legal documents like the format shown in
EXAMPLE 1 below:
EXAMPLE 1
(signature)
————————
John Doe
“But what is the consequence of signing my name like in EXAMPLE 1 above to invoices, agreements, or documents?”
EXAMPLE 1 and the above signature format legally establishes that YOU have signed the contract, invoice, loan, or agreement as an individual.
And not as an agent on behalf of your business.
If you sign your name to agreements in the form depicted in EXAMPLE 1 above, YOU could very well be liable personally to meet all of the terms of the agreement.
And you likely don’t want to do this!
Why Simply out, because you’re therefore subjecting all of your business assets and personal assets as well to the risk of a lawsuit.
If you sign agreements as depicted in EXAMPLE 1 above, YOU will very likely be named personally, as well as your business, in any lawsuit filed against the business.
Remember then:
Signing your name like in EXAMPLE 1 above DOES NOT establish that you have signed the agreement as an agent on behalf of your business.
“Okay. So how should I sign my name to my invoices, contracts, leases, loans, or any other business agreements?
What simple step can I take to protect my business, and my personal assets as well?
SIGN DOCUMENTS ONLY AS AN AGENT OF YOUR BUSINESS
Make sure that you only sign legal documents, letters, memos, invoices, loans, leases, etc… as an agent of your business.
How must I sign my name to any legal document or agreement to show that I am signing only as an agent of my business?
Follow EXAMPLE 2 below:
EXAMPLE 2
ABC CORPORATION, INC.
(signature)
———————————–
BY: John Doe
President (Company Title)
If you sign your name on the dotted line following the exact format depicted in Example 2 above, you legally establish that you are only signing as an agent on behalf of the business…and not in your individual capacity.
But you MUST follow the Example 2 precisely.
CAVEAT: Another very important point on this topic.
AVOID SIGNING documents that state “PERSONAL GUARANTY” on them.
A Personal Guaranty is usually a separate legal document attached to the main agreement. You generally see a Personal Guaranty in a loan, mortgage, or lease. However, sometimes a Personal Guaranty can be established just by the way you sign the legal document, invoice, lease, or agreement.
How?
Simple. If the agreement merely has a signature line that has your individual name on it without any reference to your business name, you are signing the document as a Personal Guaranty. You are therefore personally liable for that agreement if you sign the agreement with such a signature line.
But, what do I do if I am being required to sign a Personal Guaranty, like for a business loan or commercial lease for example?
If a Personal Guaranty is required, you or your lawyer should negotiate a limited period of time (the shortest possible) that the Personal Guaranty will bind you as an individual.
Remember, if you formed a corporation or LLC in the first place, you did it to avoid personal liability and to protect your personal assets. Anyone who does business with your company should, and usually does, know this. So, be careful. Other possibilities can be negotiated too. Just do your best not to sign in your personal capacity by signing a Personal Guaranty.
It’s important to remember to only sign legal documents, invoices, and even letters as an agent of your business. (Follow the format found in EXAMPLE 2 above).
How else can I make sure that I am signing my name properly to all of my business documents?
Call your attorney to review all of your agreements, invoices, leases, and legal documents BEFORE you sign them. Your attorney will offer sound advice that protects YOU, your loved ones, and your business.
Now, let’s review.
What’s in a name?
Well… besides your business…
…it could be all of YOUR personal and family assets!
The best advicve especially in the midst of tough economic times or a Recession, is to have any document you sign first reviewed by your lawyer or business consultant.
Copyright (c) 2008. Miguel Mendez, Jr. All rights reserved.
October 9, 2016 / como / 0 Comments
E-Commerce and E-Business are two completely different terms but unfortunately they are always used interchangeably by many of us. The reason behind this lies in the meanings of business and commerce in English language. But there is a difference between e-commerce and e-business. There are many people who understand the subtle differences between the two and there had always been a debate among these two groups about the differences and similarities between e-commerce and e-business. The aim of writing this article is to clearly bring out the differences between the two as both of them are completely different phenomenon.
The differences between the two are as follows:
1. E-Commerce is the subset of E-Business. If you remember the Venn diagram you studied in school then you can very well understand what I am trying to convey. The later one is a very broad concept while the former one is just a small part of it. This relationship will be cleared in the subsequent points.
2. Those activities which essentially involve monetary transactions are termed as e-commerce. However, e-business is a much broader term. There are many other things besides selling including but not limited to marketing, procurement of raw materials or goods, customer education, looking for suppliers etc.
3. To sell online is e-commerce but to bring and retain customers and educate them online about the product or service is e-business. Having a website to do it is not sufficient. But, having a professionally built website loaded with latest technologies to capture the attention of the visitor and win his/her appreciation is required. When money is involved then the first thing which user looks for is safety and security of his/her money. Having a website laden with such qualities is important.
4. When Dell sell computers, laptops, monitors, printers, accessories etc online then it is not engaged in e-commerce but e-business. Let me tell you how. When a visitor comes on the website, the first thing he see is website design and navigation as well as those things which are going to help him find what he is looking for and if he directly lands on the page he was looking for, he looks for the information related to it. The information provided should be appealing and clear maximum doubts of the visitor so as to convert him in a client. Till now no money has been exchanged nor been talked about. So, was this e-commerce? No, it is e-business which guides the visitor.
5. E-commerce has also been defined as a process covering outward processes that touch customers, suppliers and external partners while e-business covers internal processes such as production, inventory management, product development, risk management, finance etc.
In all, e-commerce can be described as the use of the Internet and the web to transact business. More formally, digitally enabled commercial transactions between and among organizations and individuals. On the other hand, e-business can be described as the digital enablement of transactions and process within a firm, involving information systems under the control of the firm. Moreover, e-business applications turn into e-commerce precisely when an exchange of value occurs.
October 9, 2016 / como / 0 Comments
Have you ever considered exactly what influence a single photograph could very well have on your overall business? What if perhaps I told you that if executed the correct way, professional photography could very well boost your product sales considerably? A lot of us have by no means thought of it previously or maybe took it casually. After all, as business owners, most of us have a great deal to manage and priorities need to be made so that sort of ignorance is understandable.
Having said that , understand that approaching photography for your business half-heartedly may greatly diminish your potential selling power. To better present my position, I am going to share a few instances with you of just how a good photograph could very well increase your business’s success.
As we both know, photographs associated to your business tend to appear in these two mediums ; often on the web (as an online advert or simply on your site) or as an offline advertisment, generally in some type of magazine or paper. Quite simply, photographs should be utilized as a promotional piece in your advertising so if you really want to pack more punch in your promotions, know that visual aids are actually a huge aspect. In many cases, actually more so then surrounding copy.
So as a business, you can almost certainly make use of photography in one or more of these areas: photographs of your specific business setting, photographs of your merchandise, and photographs of you and your personnel. After all, you will find three important things consumers have to love before they will buy from you and that is you/your employees, your merchandise, and your company. Keep in mind, your business location fits in closely with your product and brand if individuals are going to it in order to conduct business along with you.
Now that you have an understanding of what photographs could be used for in your business, let’s discuss why this is important. As I said previously, you need prospective customers to like you/your staff, your products, and your brand. Well, unless you are not advertising or promoting yourself at all (which you really should be), people will begin to make opinions of your business based on your ads and pictorials and I’d suppose you like to form excellent first impressions.
After all, selling will be considerably simpler when your prospective client already thinks highly of you. You better believe that I shake my head when I see a business spending a great deal of money on an advertisment just to include photos that they took using their digital camera. I can’t knock business owners for trying, but with professional photographs and a quick modification of layout, you’d be amazed how much more attraction an advertisement can have. Have you ever been to an open house from an advertisement you noticed in the paper and then went only to discover it appeared even bigger and more beautiful in the photographs; that’s an example of the magic of good photography. Do you want people showing up at your place because they are intrigued and amazed with your photos?
More importantly, do you want individuals to look at an image of your product and be impressed by how professional and high quality it looks. Had you been a jeweler, would you want your product photos to seem like they came from Zales or from John’s Jewelry Store on ebay?
I highly recommend you have a look at where you can improve the photography in your business and begin taking action. You should be enthusiastic to bring out a new quality in your brand. A few good photos can last quite a long time in your business and you will be glad you decided to go the extra yard while the competition chose to scale back.
October 8, 2016 / como / 0 Comments
Working Capital is an area of business that requires solutions that revolve around timing. Timing is everything when it comes to the fundamental problem of managing and solving the cash flow conundrum!Let’s examine some of those solutions using the example of a company trying to grow… which is what it’s all about is it not?!
This is when what we could call your ‘ cash flow cycle ‘ needs to be both understood… and addressed. That’s because the concept of timing has just kicked in … your have produced your goods or provided your services and a specific amount of time has lapsed as you now generate revenues via invoicing… and wait for payment. It’s no secret that that whole cycle varies between each company and industry. But whether your cycle is 30 days or 120 days the effects of that timing require certain activities to be financed.
The timing around this cycle, as well as the solutions that your bring to bear makes or breaks your overall liquidity and solvency – aka ‘ Survival’!Example of the need to finance that cycle are should be quite clear – your firm must buy supplies or inventory, at the same time taking on payables. Wages and salaries must be covered and then you’re in the waiting game when it comes to delivery and acceptance of your goods and services, as well as final payment from your clients based on your credit terms. It’s therefore no secret to the business owner to see that using our example it can easily take those 30-120 days for a dollar to in effect flow through your company.
Again… it’s ‘ timing’!When you look at your balance sheet you see that the ratios of current assets and liabilities have also changed dramatically. You’re unfortunately less liquid and this can only be solved by financing the shortages you have carried. Of course your customer could pre pay you in advance for orders, or pay you ‘ cash on delivery ‘ but that’s not the perfect world we dream about.Financing business cash flow is all about monetizing and managing your assets.
Solutions in Canada include:
Receivable financing
Commercial bank lines of credit
Asset based lines of credit
Sale lease backs
Tax credit monetization
Purchase Order and Supply Chain financing
Utilize one or a combination of solutions to manage the ‘ patterns’ of financing that your business needs. Seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can assist your with putting together a solution that addresses the timing of cash flows and capital in your business.
October 8, 2016 / como / 0 Comments
Tesla Motors is one of the few companies that boasts of high-end electric vehicles. Investors and stakeholders have invested in a solid stock that has resulted in stability for them. The company follows a pattern that has resulted in their massive success. Tesla stock has also gained stability due to the same reason.
The first thing that the company religiously follows is innovation. For any company to become the industry giant, innovation plays a very important role. All those companies who do not innovate are usually the ones that do not do well with the consumers. It is extremely important to come up with new services and products every now and then to make a stable mark. Tesla products are not only innovative but are trendsetters that ensure that the product penetrates deeply amongst consumers.
Secondly the company always welcomes new ideas and motivating spirits on board. The company has those partners who not only benefit the company strategically but are also motivated and enthusiastic about TSLA products. The company has always made the right choice while prioritizing about who it really wishes to partner with resulting instability and growth.
Thirdly, the company also believes in diversity. Tesla has never followed a monotonous pattern but has the urge to come up with nothing but the best. This can be governed from the fact that Tesla will only be the first company to launch an autonomous car by the fiscal year of 2015. This it is a massive achievement for the company. Moreover, the company is not just a manufacturer of equipment that fulfill the companys need but also sells its products to all those who need. This further makes its products available to the masses and propagates sales.
Tesla not only cares about its image as a brand but has always associated itself with noble causes. People tend to have a soft corner for companies involved in philanthropic activities and undoubtedly Tesla is one of the few companies that care about humanity.
Moreover, the best part about the company is that it ensures a safer ecosystem since the cars manufactured by the company do not generate any fuel or gas emission conserving the planet.
Lastly, the company values its clients. It has never tried to charge extra or more than the designated amount making it a luxury yet the budget-friendly commodity.
Thus, for any entrepreneur who wishes to establish his business needs to study how Tesla Motor governs their business in order to have growth and stability in the times to come.