Benefits Of Mediation For Small Businesses

To mediate or litigate? What's better for your business? Are there a lot of benefits conducting mediation for small businesses?

What are the benefits of mediation for small businesses?

Business is all about maximizing time and money so the faster and less expensive the resolution of the legal dispute, the better!

While mediation is a fantastic tool for any size businesses, it is particularly useful for small businesses that depend on small networks of people to run successfully. Litigation is not only costly but can create hostile relationships in business. Mediation, on the other hand, can settle matters through more agreeable means.

What exactly is mediation?

Mediation is a type of alternative dispute resolution where both parties agree to meet with a neutral third party to resolve issues and come to an agreement.

Why would a small business need mediation?

Disputes and conflicts occur all the time in small businesses. They could occur with business partners, owners, customers, employees, vendors, and between other businesses. When these disputes occur it is often up to the owner to figure out a way to quickly and effectively resolve the matter. Small business owners don't have the money or legal teams like large corporations and therefore they can't fight disputes as aggressively, nor would they want to. A small business depends on their reputation in their neighborhood. If they receive bad press it could destroy their small business. That's why it's in their best interest to quietly and quickly resolve matters in a way that all parties involved find agreeable.

Major benefits to small business owners include:

  • Avoids costly court fees and legal fees, especially if the conflict isn't worth it
  • Often only takes a few hours instead of weeks in court
  • It's a more informal option than court and it really allows both sides to hear the problems from their perspective, allowing for more realistic settlements to be reached
  • Avoids the hostility, resentment and destroyed business relationships that can come along with a lawsuit
  • Local business chambers often have mediation programs just for small businesses
  • If no resolution is reached through mediation, then going to court is still an option
  • Agreements reached in mediation can be made court enforceable
  • Resolutions may be more easily reached in mediation because parties won't feel like they're being attacked like they sometimes do in court
  • Both parties learn how to deal with these types of business disputes better in the future
Leave a comment below or send us a message if you have more questions about mediation for small businesses.


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