Whether a mom-and-pop shop or a corporate conglomerate, conflict in business is practically unavoidable. This could include disputes among employees, vendors, customers or competitors, for example. In the pursuit of a resolution, one alternative to litigation is business mediation.
As a litigation law firm like Brown Kiely, LLP can explain, the goal of mediation is to seek authentic understanding among the conflicting parties while working toward a just resolution, all with the help of a mediator or neutral third party member. When it comes to small businesses, mediation is a method to build community with customers and neighboring entities.
Even minor disputes require resources like legal departments, human resources, public relations, and above all, time. Small businesses often do not have the money nor expertise to come up with said resources to deal with a legal dispute. Plus, a small company’s reputation is imperative to good business, so finding an amicable resolution is crucial.
Mediation typically costs less than finding legal representation. If you do hire a private mediator as opposed to a community mediator, which is often offered at a lower price, both conflicting parties must share the cost. Mediation is also less costly in time: it typically only lasts a few hours.
Mediation can be a bit difficult to envision in practice. According to WilsonPorter.com, here are three examples of disputes among small businesses that were solved through mediation:
1. A small business owner was told she would have to pay thousands of dollars to cancel a contract with a lead generation online business. She was unaware that each time she increased the monthly amount of her original 12-month contract, she was actually signing a new contract. Through mediation, she was able to end her contract without paying the fee.
2. A faulty tractor had been supplied to a farmer, who then tried to negotiate with the company. After ignoring his calls, the company then refused to discuss any sort of resolution. After going through mediation, the supplier had to take back the faulty tractor and supply a new one with warranties.
3. A small business owner spent six months trying to figure out a payment dispute, but a resolution was nowhere in sight as complications arose with other businesses involved. After the meditator stepped in, the debt was cleared with a payment plan.
More often than not, mediation ends in a settlement. This looks like a signed agreement or memorandum laying out what each party has agreed to. Successful or not, though, the option to take legal action is never off the table.
If you are affiliated with a business in the middle of a dispute, consider pursuing mediation over litigation. Look into local community mediation centers that offer low-cost services today.