Protect Your ASSets in Business

Many people are starting an online business without a thought about the danger this may pose to their personal assets. The type of protection you need depends upon the nature of your business and the amount of your personal assets.

If you have no personal assets, you probably don't need much protection. They say "you can't get blood from a turnip". Hey, if someone wants to take over your credit card debt, they are welcome to it!

But if you do have investments, or own a home, and someone sues your business, they could take your personal assets. If you do not incorporate your business, by default it is a "sole proprietorship". This means your business is YOU and your assets are at risk.

If your product is something like greeting cards, then you are not extremely vulnerable to a lawsuit. You would think it would be difficult for someone to be harmed by a greeting card, but someone might interpret the prose on the card as personal character defamation, or they might get a paper cut from the card. Remember a few years ago when a lady sued McDonalds after she burned herself by placing a cup of hot coffee between her legs?

If your product is a food item or a physical object, you could be especially at risk of a lawsuit. The list below provides some steps you should take to protect yourself if you run a business.

1. Incorporate your business. A corporation is treated like a separate individual. If the corporation is sued, your personal assets cannot be taken. You don't need to pay a lawyer $1000 to file the papers to incorporate your business. You can do it yourself for about $50.

2. Post a disclaimer on everything you make. Your disclaimer should include a phrase like; "you do not make any warranties of merchantability or fitness for a particular purpose, either expressed or implied. By using this material, the user assumes complete responsibility for any and all damages resulting from that use."

3. Provide a "limited warranty" that defines the specific things that you guarantee about your product. If you don't, then your product is subjected to the default general "warranty of merchantability". Basically an unconditional guarantee.

4. If mis-assembly or misuse of your product might cause damage, then you need to provide complete instructions. Clearly state the proper use of the product and place a warning about misuse of the product.

5. Place large clear warning labels on your product and the packaging. The presence of warning labels has protected many businesses from large legal settlements.

6. Write a complete manufacturing specification for your product. Many lawsuits are based on the presence of a "manufacturing defect". Although a specification can work against you, if you don't have a manufacturing specification, that in itself is evidence of negligence.

Don't jump into starting a business without taking steps to protect your personal assets. A business failure is a sad thing, but a business failure where you also lose your personal assets is a tragedy.

And by the way - I make no warranties of merchantability or fitness for a particular purpose, either expressed or implied. By using this material, the reader assumes complete responsibility for any and all damages resulting from that use.

Permission is granted for the article to forward, reprint, distribute, use for ezine, newsletter, website, offer as free bonus or part of a product for sale as long as no changes are made and the byline, copyright, and the resource box below is included.

About The Author

Copyright(C)2004 Bucaro TecHelp. To learn how to maintain your computer and use it more effectively to design a Web site and make money on the Web visit bucarotechelp.com To subscribe to Bucaro TecHelp Newsletter Send a blank email to subscribe@bucarotechelp.com

---

Methods of Generating New Ideas for Entrepreneurs

Summary: Even with a wide variety of sources available, coming... Read More

Chairman Greenspan and the FED, learn more you will be glad you did

So many people work their whole life to make money,... Read More

The Entrepreneurs Prayer

As I awaken with the gift of yet another day... Read More

Are You Ready To Be Your Own Boss?

You have this burning desire you want to be on... Read More

Strategies for Overcoming Obstacles to Discovering Your Gifts

What are the unique gifts that differentiate you from other... Read More

Business Planning for College Students and First-Time Entrepreneurs

More and more students, both in undergraduate and graduate institutions,... Read More

Does It Really Take Money To Make Money (Online or Offline)? A Reality-Check of 2 Case Studies

The short and simple answer to this question is NO!Now,... Read More

How A Woman Became A Successful Bill Collector In A Mans Industry And How You Can Too!

I have worked in the credit industry for over 17... Read More

Leadership Attributes for Business Success

Business success is essentially the result of successful leadership. Contrary... Read More

Independent Auto Detail Shop VS Biz Op or Franchise

Owning a detail shop can be an exciting and rewarding... Read More

CHINESE TAKE-OUT: Oriental Business Principles Demystified For Online Enterprises

"The expectations of life depend upon diligence; the mechanic that... Read More

Is Now the Right Time to Become An Entrepreneur?

A number of economic changes are magnifying the role of... Read More

History of Enterprise Car Rentals

So few really understand the drives and motivations of entrepreneurs.... Read More

10 Tips for Would-be Entrepreneurs

Every evening as the sun sets beyond the mangroves that... Read More

Answering Why You, Why Now Critical in a Winning Business Plan

Business plans continue to be an essential element of the... Read More

Why Most CEOs & Entrepreneurs Fail?

Times are tough. The economy is in a constant state... Read More

Think - Dont React

How you think, your relationship with yourself is what decides... Read More

Delivery Companies Make the Grade

In the United States we have the most efficient delivery... Read More

Staying Ahead of the Perils, Excerpt of Entrepreneurial Motivation Speech

Running a business is not an easy endeavor, it takes... Read More

Preparing to Outsource

It's important to understand when to add individuals to your... Read More

Selecting a Venture

The basic rule is simple: "Find a market need and... Read More

Fear of Failure

Of all the real or perceived impediments to success, the... Read More

Adding a Service After You Buy a Business

When you buy a business, you should have a plan.... Read More

Starting Your Business: It All Boils Down To Making Money and Saving Money

Bootstrapping in the context of business start-ups refers to the... Read More

The 5 Senses of an Entrepreneur

If you have seen me speak you will know that... Read More

How To Find Hot Online Business Ideas

Would you like to find the key that unlocks the... Read More

What Kind of Business Should I Start?

It's not uncommon to reach your 30s, 40s or even... Read More

Be An Entrepreneurial Artist: Paint A Picture, then Commit It to Canvas

James had an original concept and he needed an investor.... Read More

Raising Entrepreneurs: What to Do When Your Kid is Born to Think Differently

Adolescence brings with it many challenges ? for both parents... Read More

The Boss is DEAD!

Some of us are born into families with "it", some... Read More

The Ideal Length of Your Business Plan

How long should a business plan be? A business plan... Read More

Entrepreneurial Hate, its out there

Today, I got an email from a lady who hates... Read More

PR That Entrepreneurs Often Overlook

If that sounds like you, here's what you may be... Read More