Coronavirus has disrupted markets and roiled small business owners while jeopardizing the world economy. COVID-19 is causing companies to address a host of challenging issues about how they should transact business and manage employees amid a global pandemic.
There are a few considerations that businesses may want to consider to help them navigate uncharted waters. While the information presented below is general, speaking with a Florida business lawyer will help company owners handle industry-specific concerns.
1. Furloughs and Layoffs
Furloughs and layoffs are alternative work arrangements that allow employers to reduce their labor costs. A furlough is mandatory time off for a specific period, whereas a layoff is a cessation of work until business increases.
Both carry different impacts and should be used wisely. Discussing company needs with a Florida business attorney will help leaders understand their options when dealing with workforce woes amid a pandemic, like coronavirus.
2. Consignment Agreements
Consignment agreements are contracts that grant a party the legal right to sell merchandise on behalf of another seller. It is an excellent idea to put the terms and conditions of the transaction between the two in writing.
Typically, a percentage of the sale goes to the seller in the form of commission. Consignment agreements allow business owners and suppliers to free up cash flow by not requiring either party to make a significant purchase or commitment in a small business capacity.
3. Owner Financing
Owner financing is when a property buyer borrows money from the seller to make the purchase rather than through a commercial lender. Buyers may borrow the whole amount from the seller or in combination with a bank loan.
Owner financing is one way for buyers and sellers to initiate and close transactions faster than going through a traditional mortgage lender. However, there are pitfalls that both parties must avoid and choose with whom they enter into the agreement wisely.
4. Mechanic’s Lien Filings
Construction contractors and real estate owners may want to consider using a mechanic’s lien to protect their businesses. Mechanic’s liens allow companies, who offer these services, an opportunity to file a claim for unpaid compensation.
Placing a lien against the relevant property ensures that contractors and suppliers receive a portion of sale proceeds if the owner sells it.
5. Barter Agreements
Barter agreements are contracts that govern transactions where goods and services are exchanged in place of cash. Fair market value (FMV) assessment and meticulously written conditions will facilitate a smoother transaction.
While barter agreements ease immediate cash burdens, parties involved in the exchange should discuss the terms outlined in the contract with a Florida business lawyer. He or she can help business owners determine if the document is legally-binding as well as reasonable for the given circumstances.
6. Settlement Agreements
Settlement agreements are contracts that allow parties of a lawsuit to resolve disputes out of court. Rather than wait for a jury trial, which could take months or years, settlement agreements give businesses a chance to move on quickly but still become part of public record.
Before entering into any settlement agreement, business owners should seek the advice of a Florida business attorney before signing on the dotted line. Doing so ensures that the deal is fair and does not carry unwanted future implications.
7. Payment Plans
Payment plans are an act of goodwill toward customers. As more people face lost work wages, offering payment plans to customers allows business owners to lend a helping hand while staying cash flow positive.
Take the time to review the client’s payment history, credit rating, disposable income, and other financial signals. This tactic will help business owners structure payment plans that make sense for the specific financial situation.
Contact a Florida Business Lawyer at Boyer Law Firm, P.L.
No matter what happens, the coronavirus is likely impacting business owners in the future, if it has not happened already. The most practical method for managing the impact is through careful preparation.
Contacting a Florida business lawyer will help companies discuss the effects of a global health crisis on employees and the bottom line. Rather than panic, it is time to stand firm and prepare for what may lie ahead.