Management checklist that small business owners and small and medium-sized business managers must know

For successful business operation, good ideas, strong capital, and a ‘sustainable management strategy’ are essential. For sustainable management, it is important to comply with legal requirements and prevent risks. In particular, small business owners and small and medium-sized enterprises need to be careful because minor mistakes often lead to fatal results due to relatively insufficient management organizations such as legal affairs, tax affairs, and labor. Therefore, in order to run a business stably, it is necessary to keep in mind the key points that must be checked.

First of all, in the process of laying the foundation for your business, you must properly select business registration and legal form. This is because taxes, scope of responsibility, and financing methods vary depending on whether you operate as a sole proprietor or establish a corporation. For example, a sole proprietorship is relatively easy to establish and operate, but there is a risk that business debt can affect personal assets. On the other hand, corporations have separate legal responsibilities, but their establishment procedures are complicated and their operating regulations are more stringent than those of individual businesses.

Additionally, you must check the necessary licenses depending on the industry. In the case of the restaurant business, along with business registration, it is essential to take hygiene and fire safety training and sign up for fire compensation insurance and liability insurance. Medical businesses must have a license and obtain permission from an administrative agency, and education businesses must also submit documents such as an application for academy establishment registration to the Office of Education. If you choose a corporation during the establishment process, you must prepare articles of incorporation and systematically organize the list of shareholders to prevent future legal disputes.

Contract review is also an aspect that cannot be neglected. Some businesses rely on verbal agreements, but this can be disadvantageous in the event of a legal dispute. A contract is not simply a formal procedure, but a key means of preventing risks that may arise in the future. In all employment relationships, writing an employment contract is basic, and if you work with a partner, writing a partnership agreement is essential. Also, in relationships with business partners, payment terms, delivery schedule, and scope of responsibility must be made clear through contracts. Transactions conducted without a service contract or supply contract can result in large losses due to even a minor misunderstanding.

Human resources and labor management are also one of the commonly overlooked aspects of small and medium-sized business management. If there are five or more full-time workers, labor laws such as the 52-hour workweek must be observed. Along with signing an employment contract, it is also essential to provide a salary slip. In addition, if annual leave and severance pay standards are not followed, there is a high possibility of being involved in an investigation by the Labor Office or a legal dispute with workers. In particular, as the protection of worker rights, such as workplace harassment and unfair dismissal, has become more important, preventive measures such as internal employee training have become important. Although the human resources management system may be lacking at the beginning of the business, if it is not improved during the growth stage, it may face unexpected legal disputes.

Taxes and financial management are important factors in determining business sustainability. Unlike large corporations, small business owners and small and medium-sized businesses often find it difficult to hire tax experts, so they need basic tax knowledge and procedures to familiarize themselves with reporting procedures. Value-added tax (VAT) reporting, income tax, and corporate tax payment schedules must be carefully managed, and it is best to prepare in advance to reduce the burden of additional tax. It is also important to use tax saving strategies and properly prove legally recognized expenses. For example, work-related expenses must be recognized as expenses by thoroughly managing receipts. In addition, even in the case of small business owners, if they have employees, they must not forget to report earned income withholding tax and the four major insurance policies.

Lastly, intellectual property protection is directly related to long-term brand strategy. Registering your business name and brand trademark right from the start of your business will be helpful in case of future legal disputes. Assets such as logos, content, and product designs must also take copyright protection measures to prevent unauthorized use. In particular, as online business becomes more active, brand value has become more important, and trademark disputes abusing this are increasing, so caution is required. Conversely, you may make the mistake of unknowingly infringing on another company's patent or trademark, so you should conduct a thorough review before filing.
 

Small Business Team

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Management checklist that small business owners and small and medium-sized business managers must know (shortcut)