No matter how amicable you are in your day-to-day dealings and how determined you may be to avoid becoming embroiled in the type of long-running disputes that can be so damaging to small businesses, it is highly likely that you will be faced with at least one major disagreement with a partner, supplier or customer during the course of your career as an entrepreneur. Your goal should not be to avoid such disputes at all costs but rather to resolve them as quickly and painlessly as possible when they occur. In this short guide, we will take a look at some of the factors to consider when approaching dispute resolution and why you should always think carefully before taking any action.

1. Supplier issues – if you should happen to run into difficulties with your suppliers it can be very tempting to take a hard line as you are the customer and the customer is always right, so they say.

Well, you may be surprised to learn that many people do not believe the client is always in the right when it comes to resolving disputes and it is definitely something that you should consider before wielding a big stick in your negotiations with troublesome suppliers. Firstly, the supplier in question may be your only option in which case you will of course have to take a more nuanced approach than you might otherwise take and secondly, it could well be that a member of your staff is in the wrong and not the supplier who initially appeared to be the culprit. In summary, take the time to learn the facts before you go off half cocked.

2. Customer issues – unless you want your career as an entrepreneur to be very short lived, you should always tread carefully when attempting to resolve disputes with customers, no matter how unimportant they may seem in the great scheme of things. The main factor to consider when dealing with disgruntled clients is that the word-of-mouth advertising [1] that you place great store in when things are going well is just as powerful when things are going badly. Before you upset a small customer in the belief that their business will not be missed, think about how many people they know in the same industry and how much damage they could do if they put their mind to it. Even if the client in question is not malicious by nature, it is never a good idea to upset the people that provide your company with an income; they are the lifeblood of your organisation and should be cherished at all costs.

Note: Now, you may well be thinking that I have just given two contrary pieces of advice as far as the customer-supplier relationship is concerned and in a strictly literal sense you are right. However, avoiding ugly confrontations with your clients does not mean that you have to concede every time there is a disagreement. What it does mean is that you should seek ways of resolving disputes that will minimise any damage to your relationship with the customer in question.

Business Handshake (PD)3. Business partner issues – these can be some of the hardest to overcome as they are often based on longstanding grievances. Deep wounds take the longest to heal and when you are dealing with an unhappy partner, this is definitely something that you should bear in mind. If you find your livelihood being threatened by the actions of a partner who is threatening to leave the business and who refuses to sit down and discuss the matter, by all means consult a legal expert as you may have to seek recourse in a court of law at some point in the future. However, if the partner in question is willing to behave in a reasonable manner and your business is not in any immediate danger, an amicable out-of-court settlement is of course always preferable, although you may still wish to consult a solicitor before sitting down to talk.

Conflict resolution is never an easy task, especially when large sums of money are involved. However, with patience, determination and a cool head there are not many disputes that will defeat you in your entrepreneurial career.

By Olivia Breen

Olivia is a freelance writer  for legal firm Cruz Law in Gibraltar that has been in business since 1996. They are specialists in handling cases related to taxation and other areas.

[1] http://www.businessweek.com/debateroom/archives/2011/12/word_of_mouth_is_the_best_ad.html

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