Woolley & Co E-Zine

Keeping You Up To Date With Changes That Affect Your Business

Welcome to the December issue of our regular legal bulletin. This month we look at the effect the law can have on your business – even after you’ve decided to sell it, how you can get invoices paid – on-time, and we make a SPECIAL OFFER to readers.

We welcome your feedback – if there is any particular legal issue you’d like to see covered send the details through to
marketing@e-lawfirm.co.uk.

Andrew Woolley

Andrew Woolley, Principal, Woolley & Co

Data Protection And Your Growth and Exit Strategies

Data Protection sounds, understandably, a very boring - some may say largely irrelevant - subject to small business owners. But it can cost you many thousands of pounds to ignore it.

Many business owners are not aware of the effect the Data Protection regulations may have on how much they can sell their business for and what they can borrow.

For e-commerce businesses, and many others too, a key asset is almost bound to be the customer or contacts database the “data”. Imagine the effect on the value of the business if the potential purchaser was informed that it could only be provided with general, statistical information about the customers with whom the business deals, but no information such as names, contact numbers, addresses and so on.

The Act requires the person who controls the data (you) to comply with eight "data protection principles" or principles of good information handling. The most important of these is the first principle - that the data must be processed "fairly and lawfully". Essentially, this means that the data subject must have given his or her consent to the processing of data about them. If it is envisaged that a database may be sold as part of an exit strategy, data subjects should be informed of this when their data is collected. This can be communicated in a data protection policy or statement which also sets outs the identity of the data controller and the purposes for which the data will be used.

But be aware - most data protection policies are not worded correctly for this purpose and tend to say the opposite, such as “We will not sell your information to anybody”. That is a major mistake. You WILL want to sell their information if and when you sell the business, as it constitutes about 95% of the value of your business.

Why does this affect how much you can borrow? Because a lender will want to look at the value of your business, what they could get for your business if the lending “went bad” and the business had to be sold.

Businesses have run into major trouble in this respect, make sure you’re not one of them. A well-drawn data protection or privacy policy is essential for any business holding customer or client data. Contact Woolley & Co if you would like a policy written in plain English, to meet the specific needs of your business. Email us at aw@e-lawfirm.co.uk or call 01789 267377.

Protect Your Business from Bad Debt

At some time or another most businesses experience bad debt, whether it’s simply unacceptable delays in invoices being paid or a complete failure to pay. There are three simple steps you can follow to avoid bad debt:

Make sure you have a contract or written terms of business in place with all customers and clients. There’s no need for a complicated 20 page legal document that you can’t even understand – but you do need to protect yourself and be clear what customers can expect from you and when you expect to be paid.
Always confirm telephone orders in writing, and include a copy of your terms of business. For those trading on-line also make sure you confirm email orders and that your on-line terms and conditions are read and accepted by customers, and that you have a record of this.
For larger orders do a credit check on the customer – easy to do through on-line resources.

Unfortunately even if you follow all of these steps the odd company may still fail to pay you on time. Luckily there’s a simple, cost effective solution – for Ł15 plus VAT Woolley & Co will write to your debtor, giving them 2 days to pay. This approach achieves an 86% success rate and, on the rare occasion where the debtor ignores the letter, we offer a very fast and cost-effective recovery service via the courts. Email the details of any debts you would like us to recover to jk@e-lawfirm.co.uk or call John King on 01332 694350.

Free Website Health Check

The first 5 readers of this E-Zine to contact us by email at aw@e-lawfirm.co.uk are entitled to a free legal health check of their website. This will include a review of the following:

Data protection and privacy policy

On-line terms and conditions – the small print

Returns policy
The review will be particularly valuable to firms trading on-line.

To read more about how the law might affect your business visit
www.e-lawfim.co.uk.

To find out more about these and other legal issues visit the Woolley & Co website at www.e-lawfirm.co.uk.

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