Welcome to the Venture Point Blog!

Blogging is the new form of communication that enables us to voice our opinions, to ask questions and get questions answered. 

The Venture Point Business Blog was created for business owners, potential business owners, CPA’s, business Attorneys and Business Brokers, to ask questions, submit articles, tips or ideas that people may be in need or help with.  

As a small business owner, I’m always looking for information on ways to run my business more efficiently, networking communities that I can reach new colleagues and clients, and opportunities to grow Venture Point.

If you would like to submit an article that you feel would be informative for business owners/potential business owners please contact Karen@VenturePointOnline.com. 

Karen Torbett

5 Ways to Keep Debt Collectors at Bay

AS THE CREDIT CRUNCH rages on, debt collectors have become even more aggressive. And while consumers are largely shielded from debt collectors’ more obtrusive money-gathering techniques, business owners have few protections.

Barbara Clark, co-owner of Healthy Home Insulation, a spray foam insulation contactor in Vero Beach, Fla., found this out when she let three of her loan payments slip past their due dates. Clark says she had never been late on payments before, but as her sales plunged 50% in the past year, she started struggling to afford them.

The collection calls soon followed. Clark says her three telephone lines regularly receive anywhere from 30 to 90 calls from a single debt collection agency each day. When she complained to her bank, she was told to “pay up.” And while she intends to do so, Clark says having to answer the phone every few minutes certainly doesn’t help. “I’ve done everything I can do to avoid this. But business is really slow right now… I’m not a deadbeat,” she says.

Delinquencies on commercial and industrial loans jumped to 3.1% in the first quarter of 2009, up 117% from a year ago, according to the Federal Reserve. As sales continue to slide, many more businesses are expected to join these ranks, says Michelle Dunn, a small business credit and debt-collections consultant in Groton, N.H.

Making matters worse, businesses aren’t protected from debt collectors under the Fair Debt Collection Practices Act (FDCPA), which bars consumers from being threatened, harassed or called at work, and state laws offer few protections to businesses, she says.

Of course, one way to avoid an onslaught of collections calls – not to mention a blemish on your credit report – is to do everything in your power to make your debt payments, says Dunn. Cut costs and explore other revenue-raising activities that can help. If you’re in debt trouble today and those options are no longer viable, here are some ways to get the debt collectors off your back:

Establish a repayment plan

Contact your creditor or vendor that you’re late in paying immediately, suggests Doug Rosner, a director at Goulston & Storrs, a corporate law firm in Boston. “Communication is vital, especially if it’s with a vendor [or creditor] you want to maintain a relationship with,” he says. Explain your financial situation then ask if they would consider a repayment plan in which you could pay a reduced amount over a longer period of time, he says.

To get vendors or creditors to accept such an arrangement, provide a promissory note, a personal guaranty or collateral such as a lien against a second home or equipment, suggests Charles Thomson, in-house counsel for the Doall Company, an industrial supplies and machine tool distributor in Wheeling, Ill.

Work out your debts

If paying in full is impossible, request a “workout” under which all parties agree on a reduced debt amount, says Robert J. Hobbs, deputy director of the National Consumer Law Center in Boston. If your only other option is filing for bankruptcy protection, vendors, creditors and even debt collectors will often be much more accommodating, he says. If your debts are “unsecured” – that is, they aren’t backed by assets that may be liquidated in a bankruptcy proceeding – creditors risk getting nothing if you file for bankruptcy, says Hobbs.

Make partial payments

Another option for borrowers who can’t handle paying in full is to make partial payments toward reducing their outstanding debt upon each new order they place, says Thomson. So a debtor would pay $1,000 toward his or her old balance with every order for $500 in new goods, he says. This strategy works well with debts owed to vendors with whom they’d like to continue working, he says.

Play hardball

If you suspect the debt collection agent who is calling you isn’t legitimate, ask whether they’re licensed, (most states require collection agencies to hold a permit or license), says Thomson. If they don’t have a license or if they’re not forthcoming, notify the regulator in your state. Depending on the state, the regulator may be the Department of Professional Regulation, the Department of Financial Institutions or the Secretary of State, he says. Just keep in mind that the law only applies to third-party agencies trying to collect debts on behalf of creditors. They do not apply to one merchant calling up another merchant and demanding payment of a past due invoice, says Thomson.

Worst-case scenario: File for bankruptcy

If all else fails, filing for bankruptcy can get rid of those pesky debt collectors, says Hobbs. While this is an expensive process and one that you undoubtedly want to avoid, it is a business’s primary form of protection from creditors, he says. It will often wipe out most – if not all – of your business’s debts, especially those held by debt collectors, which are generally unsecured, he says.

-Write to Diana Ransom at dransom@smartmoney.com

Tax Law Changes for 2009; What’s New for Your Small Business

You may already know about new tax laws that impact small businesses as they go about preparing their 2008 tax returns.

 

The 2009 tax year also brings with it several changes to business tax law. Some of these laws are already legislated and in the public domain; more may follow, particularly due to current economic and political factors.

 

Through these changes, remember that tax planning is a year-round event and is closely tied to your overall small business planning cycle.

 

Tax laws often define and support your small business investment and growth strategies (get tips here on how to manage your tax obligations throughout the year). It’s important, therefore, to take stock and assess now how your business can comply with, and benefit from 2009 tax law changes.

 

Below is a summary of the major changes in federal income tax law that can impact your business in 2009.

 

This is not a comprehensive list, so be sure to talk to your tax advisor if you have questions about how your small business is affected. You can also refer to several informative online resources including the 2009 Small Business Tax Center on Business.gov or the IRS’s Small Business and Self-Employed Tax Center.

 

2009 Tax Law Changes that Impact Small Business

 

Major changes include:

 

Commuting and Parking Benefits for Employees – Starting in 2009, businesses can pay $230 a month in tax-free parking for employees, up $10 per month from 2008. The cap on tax – free transit passes rises to $120 a month, up $5 a month from 2008. In addition, you can offer employees who prefer to cycle to work a new tax-free benefit of $20 per month to cover the cost of buying, maintaining, and storing a bicycle for commuting purposes.

 

Expensing Business Equipment – What business expense write offs can you plan on this year? The maximum amount of equipment placed in service in 2009 that businesses can expense (section 179 Expense Deduction) falls to $133,000, a $117,000 decrease from 2008, when a temporary $250,000 ceiling was in effect. The annual investment limit drops to $530,000 for 2009. In 2008, the limit had been temporarily increased to $800,000. Keep your ears to the ground on this one, however, as the government may extend the 2008 tax breaks for 2009.

 

First – Time Buyers with Home-Based Businesses – If you operate your small business from an office situated within a first-time home purchase, you can still qualify for additional tax incentives – if you purchased your home between April 2, 2008 and June 30, 2009.

 

Lower Mileage Rates – As expected, the IRS lowered the standard mileage rates for the business use of vehicles. Beginning on Jan. 1, 2009, the standard mileage rate for the use of a car (also vans, pickups or panel trucks) is:

 

·                     55 cents per mile for business miles driven

·                     24 cents per mile driven for medical or moving purposes

·                     14 cents per mile driven in service of charitable organizations

 

Payroll Tax Changes – The maximum amount of wages subject to Social Security tax has increased to $106,800 for 2009, up from $102,000 in 2008. That means you should stop making (and paying) Social Security for employees once they reach $106,801 in eligible earnings in 2009. The tax rate remains 7.65 percent on employers and employees.

 

Maximize Your Retirement Contributions – In 2009, small business owners have the opportunity to invest more tax-deductible money in their retirement savings accounts. These include:

 

·                     401 (k) elective deferrals up to $16,500 (plus another $5,500 for those age 50 or older by the end of 2009); the limits had been $15,500 (plus another $5,000 for those age 50 or older by the end of 2008).

·                     SEP and profit-sharing plan limit of $49,000 (up from $46,000 in 2008).

·                     Defined benefit (pension plan) limit of $195,000 (up from $185,000 in 2008).

 

Increased Deductions for Health Savings Accounts (HSAs) – You can contribute more in 2009 to business HSAs, with 100% tax deduction up to limit of $5,950 for a family, and $3,000 for an individual.

 

Bonus First-Year Depreciation Ends – Businesses can no longer claim 50 percent bonus first – year depreciation on assets placed in service in 2009. This was a special write-off that was put in place for the 2008 tax year.

 

Depreciation of Restaurants and Retail Stores – The current 15 – year depreciation period for tenant and restaurant improvements is expanded to include buildings housing restaurants, and improvements made to retail stores that are placed in service in 2009.

 

About the Author; Caron Beesley has over 14 years of experience working in marketing, with a particular focus on the government sector. Currently, Caron is working with the Business.gov team to promote essential government resources such as grants and small business loans, permits and business licenses, and employment and tax regulations to small and home-based businesses.

Business.gov is managed by the U.S. Small Business Administration (SBA) in a partnership with 21 other federal agencies. This partnership, known as Business Gateway, serves as an incubator of technologies designed to improve the delivery of services and information to the nation’s small business community. Originally launched in 2004, Business.gov provides a single access point to government services and information to help the nation’s businesses with their operations.

 

Social Media & Small Business – Where To Start?

At least once a day, someone asks me a question about Social Media. It’s the buzz about business and marketing circles. Social media wasn’t a big deal a few years ago, but it became a hot topic when the masses got on board. Now, the eyeballs are online – people are reading blogs, twittering, stumbling upon stuff and checking their Facebook. There’s no arguing the buzz and rapid growth in social media.  Facebook alone has over 180 million users (see http://www.facebook.com/press/info.php?statistics) and is growing at an estimated 5 million users per week.

However, what does this mean to the small business owner? Is it worthwhile? Does it offer a measurable return? Should you even care?

The jury is still out on the measurable ROI question – I’ll address that on another day.  There are some businesses using it effectively for connecting with their target markets, but most of what I see is not providing an ROI, at least not a positive ROI. 

Is having 5000 friends on Facebook of any more value to your business than getting to Level 60 on World of Warcraft?  Who has 5000 friends that they can communicate with anyway???

Opportunities for success really depend on your business and who your target market is. There is no denying that social media can be a worthwhile part of your overall marketing strategy. It’s where a growing number of your customers and future customers are, and you need to be aware of the conversation at the very least. 

In my opinion, too many companies are jumping on board with no real plan.  Many small businesses have yet to master having an effective web presence, search engine marketing, and email marketing and here they go jumping into Social Media because everyone is talking about it.  Small business should aim their efforts at the biggest opportunities online.   According to eMarketer, over 90% of all web users use search engines and email daily. Compare that to around 16% of web users who hit a social network once a month.   

My advice to small business – Evaluate your existing online presence. If your web presence is non-existent, can’t be found, embarrassing or ineffective, get it in order first before you start telling the masses to come look.  Then, start small with social media. 

Here is my Top 13 List of things a small business can do this week to get active with Social Media.  I chose 13 because I have more than 10 and 13 is my lucky number.

1.   Specify some ground rules for your company to avoid future embarrassment – As Forrest Gump says “It happens”.

2.   Talk to your employees – gain their input and ideas

3.    Understand the community before jumping in.  For example, if  you’re in the music or entertainment industry then MySpace might be a good fit.

4.    Setup a company Facebook page. 180 + million eyeballs is enough reason. Our page;  http://www.facebook.com/home.php#/pages/WSI-Webworks/14765256759?ref=mf 

5.    Cut long distance and cell phone bills. Use SKYPE – its a free phone and instant messaging service

6.    Setup an account on LinkedIn and start connecting. Don’t expect immediate returns.

7.    Check out the competition – What can you do differently?

8.    Research prospects and customers

9.    Setup a YouTube channel

10.  Find and screen potential employees

11. Become an expert on LinkedIn – Answer questions and build your reputation

12. Use Twitter with CAUTION.  Only follow people you have an interest in and share useful info.

13. Start a Blog to build your credibility and web traffic…but only if you have the time to blog regularly 

About the Author: Doug Fowler – President at WSI Webworks, a Greenville, SC based internet marketing firm. www.wsiwebworks.com / www.taprootblog.com / 235 Adley Way, Greenville, SC 29607

Toll Free (866) 566-2005 / Local (864) 288-6162 / Mobile (864) 354-1730 / dfowler@wsiwebworks.com

Don’t Ignore The Fifth “P” Of Marketing

If you have studied marketing in college, or if you’ve purchased an off-the-shelf marketing plan template, you’ve undoubtedly heard of the so-called “four Ps” of marketing:

 

• Product – what exactly is the product or service you’re providing? If you’re IBM, is your product digital technology, or is it problem solving?
• Price – whether based on the law of supply and demand, consumer research or your gut instinct, what is the ideal price for maximizing long term profitability? How much do I need to charge and sell to achieve break-even?
• Placement – how will I reach buyers? Will it be direct, two-step or three-step distribution? How many distribution points will I need? How will I grow?
• Promotion – what should my budget be and what is the right mix of paid versus earner media (PR)? How should my company and product brands be positioned? What should be my company’s personality?

 

These are all things that you plan and manage to increase your chances of success. Most marketing practitioners will tell you that if you’ve intelligently and extensively spelled them out in a master marketing plan, then manage them with purpose over time, you should have what it takes to succeed. But there is one more “P” decision that you need to plan and manage, and it’s every bit as important as the first four Ps.

 

The fifth P is Pleasure.

 

What experience do you need to deliver for your customers to say or think, “It’s been a pleasure doing business with you.” This area of marketing is a subset of brand management. It’s called Experience Management. Remember, someone cannot “not” have an experience when interacting with your brand. So your decision is not whether to create an experience or not; rather, your decision is whether or not to plan and manage customer experiences to be consistently pleasurable.

 

 Your decisions related to the experience you deliver can make the difference between being perceived as a commodity or as a unique brand. Perhaps the greatest example of a business genius and brand visionary was Walt Disney. He built an entertainment empire around a single word – magic – and has found ways to consistently deliver positive customer experiences, built around magic, at every touch point.

 

 It’s not a coincidence that Walt Disney’s initial Florida property was named The Magic Kingdom. It’s not by chance that when you visit the park you never see trash on the ground, trash containers being emptied or food being delivered. He decided when the Magic Kingdom was built to have an underground system for taking care of these seemingly necessary things that can tarnish an otherwise great experience.

 

 So no matter what decisions you make about Product, Price, Placement and Promotion, unless you make fundamental decisions about how you will create Pleasure in the mind of your target audience, you have not gone far enough.

 

Author; Bill Nicholson  Owner and Strategy Director, At Large Marketing Solutions / 111 Antrim Drive, Greenville, SC 29607 / 864.527.1244 office / 866.541.0192 toll-free /www.atlargemarketing.com

Too Small To Spend Money On “Branding?” Think Again.

Several years ago I read a case study about how IBM spent over $1,000,000 and a year’s time to arrive at the name “Think Pad” for its line of laptop computers. They used an internationally renowned brand consultancy with dozens of employees engaged in brand research and design. The case study ended with a quote from a C-level IBM executive, saying it was money well spent.

 

So you have a business, and you believe in the power of branding, but you are saying to yourself, “so what about IBM, I don’t have anywhere close to that kind of money!” The good news is – you don’t have to.

 

Whether it takes a month or a year, and whether it costs $1,000 or  $1,000,000, the steps needed to build and manage a brand are identical. Furthermore, they are not terribly complicated and far more affordable than you might think.

 

Big budget or small, successful brands are guided by a strategic framework that includes differentiated products and services, a defined Brand Positioning and Personality, audience-specific Messaging, and Standards applied for consistency. This framework must always begin with two basic steps:

 

Step 1: Research

A.     Marketplace

·        What are the trends, opportunities and threats? What can you do to capitalize on the opportunities and avoid the threats?

B.     Competition

·        Who are they and how are they positioning themselves? What are their strengths compared to your brand, and what are your weaknesses. What are their weaknesses compared to your brand, and what are your strengths?

C.    Communications

·        What strategies and tactics have you tried, what has worked, what hasn’t worked, and why? What are your competitors doing that you are not, and does it seem to make sense to join them?

D.    Perceptions

·        What do your customers, employees and stakeholders think of your products and/or services, both positive and negative. Are the negative ones true? If so, what must be done to fix them? If not, what must be said and done to change perceptions?

 

Step 2: Design

A.     Positioning

·        Applying what you learned in the research, who is your specific target (demographic and psychographic descriptions), what is your competitive set (are you a bank, or are you a lending institution?), what two or three keys benefits will customers realize, and what is your most powerful and relevant point of competitive difference? This is the rational side of your brand identity.

B.     Personality

·        If your brand were a person, what type of personality traits would your target audience want you to have? Should you be lighthearted or serious? Earthy or highbrow? Flexible or rigid? Come up with a dozen or so, make sure they are not polar opposites, then be or become them. This is the emotional side of your brand identity.

 

We have guided companies large and small through these fundamental steps, usually as a starting point for developing a better system for managing their brand. It’s a system that replaces personal opinions with brand opinions as the basis for making communications, marketing and even operational decisions. Whether we guide you through this process – at a fraction of the cost that you might expect – or you do it yourself, JUST DO IT (sorry, Nike).

 

Author; Bill Nicholson  Owner and Strategy Director, At Large Marketing Solutions / 111 Antrim Drive, Greenville, SC 29607 / 864.527.1244 office / 866.541.0192 toll-free /www.atlargemarketing.com 

What Is “Branding” And Why Should I Care? (Part 1)

I once had a mid-sized regional bank client, whose very successful, wealthy and eccentric founder would not allow anyone to even mention the words “brand” or “branding” when talking to him about his bank’s advertising and marketing efforts. He had a staunch rule – “My bank does not do brand advertising. It’s a waste of money!”

 

The man was wealthy and successful, but he was also very wrong. Everything the bank did, from its print and broadcast advertising to the way customers were treated in the bank was “brand advertising.”

 

So what is “branding” and why should I care? I would not normally start a definition by explaining what something isn’t, but due to a great deal of confusion, even among advertising professionals. Branding is not just designing a logo or stationery, it’s not just a slogan and its not just making every ad or TV spot look similar and without mention of any product or service (like the Nike spots). Branding is all of that…and a whole lot more.

 

Branding is the unique configuration of words, images, ideas, and experiences that forms a consumer’s total perception of a company, product, or service – and gives it relevance to them. Every phone call, every email, every personal interaction, and every ad is branding. Your fundamental marketing question is NOT, “do I or don’t I brand?” Your fundamental question is, “how haphazard or controlled do I want my brand to be?” If you want to be more successful, you manage the way these interactions are created and delivered.

 

If you want to have a fair amount of control over how your brand is perceived, then one of the most important things you can do is establish a brand positioning and personality. Combined, they are your fundamental brand identity…your Yin and Yang. Some call it your Brand DNA. Others call it your Brand Platform. Whatever you call it, use it as the starting point for all decisions about the people, places and things you manage that help form consumer opinions (good, neutral or bad) about your brand.

 

Author; Bill Nicholson Owner and Strategy Director, At Large Marketing Solutions / 111 Antrim Dr. Greenville, SC 29607 / 864.527.1244 office / 866.541.0192 toll-free / www.atlargemarketing.com

Entrepreneur’s Journal: So, what is your business worth?

Let’s say you want to sell or buy a business. Or, suppose you want to gift a piece of your business to your family. Maybe you want to raise capital?

Well, you’ll need to determine the value of your business.

So, to get some perspective on the topic, I spoke to Scott Gabehart. He has valued over 700 businesses since 1991 and has written several books on the topic, such as The Business Valuation Book (with CD-ROM) .

According to him, there are several approaches to getting a valuation:

Do-It-Yourself: Yes, the valuation process can be extremely complex. But Gabehart has an easy system that will provide a rough estimate.

First, you will need to calculate your company’s adjusted cash flow (ACF). This is:

Net income
+ Your salary
+ Your perks (personal travel, discretionary expenses)
+ Depreciation
+ Interest expense

After all, it’s common for owners to use their business to pay for personal expenses. Thus, it’s important to factor our certain items (for example, depreciation is a non-cash expense).

Now, once you have the ACF, you need to multiply it by a multiple. Generally, the higher the ACF, the higher the multiple.

Here are some guidelines from Gabehart:

·                                 ACF up to $250K, multiples of 1 to 3

·                                 ACF between $250K and $500K, multiples of 3 to 5

·                                 ACF between $500K and $1m, multiples of 5 to 7

·                                 ACF over $1m, multiples over 7

Online Services: There are some web sites that generate basic valuations, which are usually based on real transactions. Examples include: BizBuySell.com and BizComps.com.

However, you need to be wary. According to David C. Baker (who operates ReCourses), valuation web services may “essentially be billboards to get you to hire a consulting firm, with very little hard content from a thought leadership perspective.”

Hire a Valuation Firm: Like any consulting industry, there are varying degrees of quality (yes, some valuation firms are fairly mediocre).

So, when selecting a valuation expert, look for the following:

·                          *    Is the person certified? The main organizations include: Institute of Business Appraisers, National Association of Certified Valuation Analysts, American Institute of Certified Public Accountants and American Society of Appraisers.

·                           *    Does the firm have a web site? This shows that the firm is serious.

·                           *    References? Don’t be afraid to ask for them.

·                           *    Costs? These should range from $2,000 to $15,000, depending on the reason for the valuation and the scope. Also, don’t pay the fee up-front; instead, pay based on different stages (the first may be the initial meetings for data input and the second could be the actual report).

About the Author; Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements . He also operates MergerBook.com.

Steps For Starting A Small Business

Prepare A Business Plan;

            www.VenturePointOnline.com offers a business plan outline on our “Resource Library” page. Or visit your local SCORE office or Business Development Center. If you’re not comfortable with writing one yourself there are companies that specialize in this.

 

Tax Structuring;

           www.VenturePointOnline.com offers a breakdown on the “Resource Library” page of the most common forms; corporation, sole proprietorship, general partnership, limited partnership, “S” corporation and limited liability company. It is advisable to consult an attorney or CPA for advice on which form will be the best fit for your company.

 

Personal Credit;

            If you intend to use a financial institution or investor for funding of your business, check your credit report first. The three major credit report agencies are; Equifax/ www.equifax.com, Experian/www.experian.com, and Transunion/www.transunion.com.

 

Register The Name Of Your Business;

            You will need to make sure that the name you have chosen for your business has not already been taken. This can be done by calling the Secretary Of State’s office or go online. If it is available then you will need to register it with your county office. If you intend to trademark your company’s name or logo, to check for US availability and applications go to; ourwww.USPTO.gov. A business attorney that specializes in patents and trademarks can also help you with this process. 

 

Business License;

            You will need to obtain a business license for the municipality in which your business is physically located.

 

Tax ID Number;

            This form is SS4 and is available through the IRS, your CPA or tax advisor.  The IRS website to obtain this form is : http://www.irs.gov/businesses/index.html

 

Register Your Business With Your State Tax Commission;

            This form is available through your state office or CPA and can be used to obtain an employer withholding number if you have employees and a retail license.

 

Real Estate;

            Whether buying or leasing real estate have an attorney review all transactions in case there are special considerations. And as a lessee make sure you are clear as to who is responsible for maintenance, up keep or damage to the property.

 

Zoning Regulations;

            Check with your city or county offices for zoning, occupancy permits, and sign permits.

 

Insurance;

            You will need to consult an agent on liability, Workers’ Compensation, casualty insurance, bonding etc. this will vary according to the type of business and number of employees.

 

Bookeeping;

            If you are not using an in house accountant or bookkeeper then you will need to consult one for advice on establishing a bookkeeping system.

 

Checking Account;

            Open a business checking account. Do not use your personal accounts for business transactions.

 

Credit Card Merchants;

            If your business will be accepting credit cards, check with the bank you are doing business with, and then shop around to make sure you are receiving the best possible rate.

 

Special Licensing or Permits;

            According to the type of business or industry you are going into it may require additional licensing or permits; Health Department, hazardous materials, occupational and professional licensing boards, OSHA, ABC, Department of Agriculture, etc.

 

           

         

What Every Business Owner And Entrepreneur Should Know About Intellectual Property Rights

Quite often, while working on various client matters, the phone rings with a prospective client on the other end of the line.  I spend a few moments listening to their issues thinking to myself…if only they’d called before; I might have been able to save them some money and headaches.

For patent issues, entrepreneurs or small business owners don’t realize the significance of disclosing their inventions to others prior to securing their patent rights.  In the United States, a patent may only be filed in the name of the inventor and must be filed no later than one year from public use or public disclosure.  Practically what does this mean?  If you have an idea and share it with someone else, who then improves or adds to its functionality, that someone else may be a joint inventor.  If so, that someone else equally owns the patented invention, no matter what his contribution. If you openly share your idea with someone else, there is no guarantee that he or she won’t tell others or use the idea for their own benefit.  Your disclosure may have started the clock ticking on the one year time bar in the United States. Thus, prior to obtaining input from others, a patent application should be filed or an agreement of non-disclosure of information and ownership rights to improvements should be entered into.

In this global economy, protecting an invention by securing patent rights only in the United States is often not significant.  Inventors also don’t know at the time of invention or filing for United States patent rights whether their invention is the next “big” one.  Outside the United States, almost every country requires absolute novelty for patentability.  Practically what does this mean?  If you disclose or use your invention publically anywhere in the world prior to filing a first (called “priority”) application, you cannot file in a country with the absolute novelty requirement.  In other words, all your rights outside the United States are lost if you publically disclose or use the invention prior to filing the priority patent application.  Once a priority application is filed, public use or disclosure of the invention is no longer a worry.  Keep in mind, however, that there is a one year time period from filing the priority application to file in other countries.

In naming any business, there is much thought, creativity and emotion involved.  After the perfect name is decided on, the next step is registering the business name, designing a logo, ordering business cards, creating stationary, etc.  Each one of these steps requires spending money.  What if after starting your business, you receive a call or letter asking you to stop using your “perfect” name because a third party already has rights to the name either through federally registered trademark rights or under common law trademark rights?  This can happen if you have not taken the precautionary steps to research your name prior to use.  Trademark rights begin upon use in commerce and there is no law requiring someone to register their name for use on goods or services.  Practically what does this mean?  To prevent unnecessary costs, a thorough trademark search should be conducted prior to using your “perfect” name as a business name or placing your “perfect” name on a good or service.  The issue of prior user rights exists not only with the name of a business, but also with any products or services sold.

In each of these instances, the loss of patent rights or the pain of resolving disputes with third parties could easily be avoided by seeking professional legal advice early from intellectual property counsel.  Myers & Kaplan Intellectual Property Law, L.L.C. is a boutique intellectual property law firm practicing exclusively in domestic and international patents, trademarks, copyrights, litigation and related matters.  Myers & Kaplan prides itself on providing high quality representation at competitive rates.  Every Myers & Kaplan attorney is registered to practice before the United States Patent and Trademark Office and specializes in providing complete and thorough intellectual property law representation.  Additionally, the attorneys have been in the “real world,” most having had significant business and/or technological experience prior to their professional legal careers. Because of this wealth of experience, we have the unique ability to provide our business and entrepreneurial clients with “business-practical” advice and legal services, across a unique cross-section of industries and practice areas. Please visit our website at www.mkiplaw.com for more detailed information.

 

Authored by Cheryl J. Tubach, Esq., Director of Corporate IP Affairs.  Ms. Tubach practices law with the firm of Myers & Kaplan Intellectual Property Law, L.L.C.  Previously she was in-house counsel for The Coca-Cola Company and Eastman Chemical Company.  Ms. Tubach received her law degree from Georgia State University in 1992 and her Bachelor of Science degree in Chemical Engineering from the University of Kentucky in 1984.