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WEB/DIGITAL Business entities/insurance for ebusiness?

yveskleinsky

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For those of you that have e-commerce sites, did you form any type of business entity (LLC/C Corp, etc) with your business? ...Did/do you have liability insurance of any kind? Is there anything that you know now about structuring an online business that you wish you knew then?
 

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yveskleinsky

yveskleinsky

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...bump
 

NerdSmasher

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Well, with my ebusiness, which was simply advertising affiliate programs, I did it all as a sole-proprietorship. In my case, I really didn't have anything I could lose, as all I was doing was using PPC search engine programs to send people to sites with my affiliate link in them.

But, depending on what your business is, you may want to consider an actual business structure... I'm always a fan of LLCs, but really have no basis on which to say it's better than anything else for ebusinesses.

And, as far as trademarks, copyrights, etc. I know that everything you yourself type and put on a website is copyrighted by law, in your name, instantly no matter what. But, other than that, it's always good to trademark and patent anything you have; and of course copyright books and things.

Perhaps someone who has started a more in depth business of their own can be of further assistance to you, however.
 

rxcknrxll

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Protecting your interest in your business makes absolute sense to me. Why would you not trademark and copy protect anything that belongs to you? If it's worth going through the trouble of creating, it's worth protecting. It's like buying a gold bar and then just leaving out on your kitchen table. Yeah, probably nothing will happen, but when it gets stolen you will feel like a chump. And you will deserve to feel like a chump.

Does anyone have an opinion to share about that Rich Dad book on intellectual property? Is it mostly remedial or is it actually insightful?

As far as liability protection, an LLC can be formed fairly painlessly and requires minimal maintenance. IMO, very good idea to use a separate entity for any endeavor. I'm not specifically recommending an LLC for you. It's just what I'm familiar with and have found them to be flexible and beneficial tax-wise also. Depending on your plan, you can have the LLC taxed as a corp also.
 
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yveskleinsky

yveskleinsky

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We ended up forming an LLC, as well as having it taxed as an S-Corp. What I am a little hung up on is if there is any specific type of insurance that we need or should have for an ebusiness. Any thoughts?
 

AroundTheWorld

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hmmm... I'm not an ebiz person, but a good umbrella policy is a good idea.
 

EComGuy

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Jun 19, 2008
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When I started my business, I didnt care about all of this. Ebusinesses can drain the life out of you. Because the majority of things in ebusinesses are not tangible, its hard to build the initial customer base and customer trust.

As they said earlier, all of the content that is typed on your site is copyrighted immediately. There is no paper work that you need to have. What I do suggest doing is printing out the content in web format, giving it to your business attorney and have him file the papers away under your LLC. That way, if the situation arises, you can call the attorney and send the dogs after the enfringing party. Also, when you files these papers with your business attorney, they are dated. Thus proving your timeline of creation, which no one can duplicate.

As far as insurance goes, what will be your profession? The thing about Ebusinesses that many people do not know is that even though there is liability out there, mainly for people that do ignorant things like for instance, not properly securing credit card information via an SSL certificate, that the majority of your online sales are final. The product was bought sight unseen and the purchaser consents to that. As long as you are not misrepresenting the product the customer can not come back to you with an illogical return. Also, the complaining party will have to report the incidents to YOUR state, no their own for something to be done. This gives the window of oppurtunity to prove you case, with adequate evidence of course, and usually the charges/complaints are dropped due to insufficiency in the claims.

I started my business from my home, a good while ago. I did not sweat the small stuff, and I worked deligently to get my customers what they needed, and if they werent satisfied then I refunded their money whether they were right or not. I remember going to pay my house note, getting a call, refunding money, and having no more money for a house note. But hey, that's what it took. And with these kind of things I now have my company for sale $65mm and have already been offered $62.5. Im not saying that to gloat, mainly to let you know that it can and will happen if you use due deligence in every situation.
 
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yveskleinsky

yveskleinsky

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Good advice about printing everything out and sending it to our attorney! ++rep
Great story by the way, if you have the time- it'd be great if you'd post it more indepth over at the success stories thread: http://www.thefastlanetomillions.com/showthread.php?t=135

As for the type of site we have, our site will be service related, (similar to hotels.com) and we do have a pretty good terms and conditions policy. My main concern is that people are sue happy and I just want to make sure we have our bases covered.
 

EComGuy

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Jun 19, 2008
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Good advice about printing everything out and sending it to our attorney! ++rep
Great story by the way, if you have the time- it'd be great if you'd post it more indepth over at the success stories thread: http://www.thefastlanetomillions.com/showthread.php?t=135

As for the type of site we have, our site will be service related, (similar to hotels.com) and we do have a pretty good terms and conditions policy. My main concern is that people are sue happy and I just want to make sure we have our bases covered.
True people are sue happy, always opputunistic people trying to make a buck, unethically of course.

As far as services go, there's not to much liability you will have to worry about. What I've seen is that most people will chock it up as a 'lesson learned' and not use your services anymore. Also, in any services related field, they're not entitled to any more monetary ammounts than what they invested. For instance, they can not pay you $200 for a booking, go on the trip and complain afterwards. The fact that remains in legal proceedings is that they have to prove some type of punitive damage that was caused by your services. This is costly, and time intensive so I would not be so much as worried about that.

I would mainly concern myself with the well-being and satisfaction of my customer, and always offer a compensation package to people that you deem are worthy of the cause. Someone can be upset with you and want to degrade your business/service, but with adequate handling of the situation they can turn a 360 and be advertisement for your customer care ability. Remember, there is no true customer care if there is no issue, it would only be an initial contact and sale.

Best of luck with it either way, and feel free to PM me for contact information if you need anything in the future!

Best,


PerryC
 

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NoMoneyDown

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I would mainly concern myself with the well-being and satisfaction of my customer, and always offer a compensation package to people that you deem are worthy of the cause. Someone can be upset with you and want to degrade your business/service, but with adequate handling of the situation they can turn a 360 and be advertisement for your customer care ability. Remember, there is no true customer care if there is no issue, it would only be an initial contact and sale.
Very good point. ++
 
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yveskleinsky

yveskleinsky

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I absolutely agree with the point of focusing on customer service. I've found that good customer service can out shine a bad product, but a great product can't undo terrible customer service. ...Our model for good customer service is Nordstroms- they are amazing. I would love to get my hands on one of their training handbooks!
 

andviv

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I would love to get my hands on one of their training handbooks!
Easy, go work for them during summer and quit after training :D

Related to the topic, if your service is similar to hotels.com then I'd be more worry about the hotels than the public. The agreements must be very clear with them as they are the ones providing the final service, you are "just a referrer"

In any case, don't listen to me too seriously, I have no clue about this topic :D
 

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