If the recent situation has taught us anything, then it would be the fact that the economy is flimsier than most of us falsely believe it to be. Those who take precautions in advance are always the ones who fare the best, once the chips go down.
On that note, we are going to highlight a few important areas that small business owners can focus on to protect their businesses against future calamities or even private disasters.
This should be the very first step for any business ventures because there’s no better way to protect your business against unforeseen circumstances than to have the assurance of proper insurance coverage.
General liability insurance and worker’s compensation insurance are the first two essential business insurance policies that every small business should get.
Visit The Hartford to find a general liability insurance policy online in minutes, one that will suit your business’s unique requirements, provide the right coverage, and be within your budget. You can get a quote instantly.
For worker’s compensation insurance, visit the official US Department of Labor website. There might also be a need for additional insurance coverage, depending on the industry you are involved in, but these should cover the primary needs of most SMEs.
If the nature of your business is online, cybersecurity should be a top priority for you. It’s common to think that a business is too small to be targeted by cybercriminals, but that’s exactly why SMEs are targeted so often.
Contrary to what they may believe, cybercriminals know that it’s much easier to hack into or infect SMEs since they are:
- living with a false sense of security and thus not taking the necessary actions to protect their online businesses
- Bigger enterprises have much more complicated and robust cybersecurity in place to be infiltrated easily, if at all
Practice a few basics of cybersecurity measures to protect your business’s online operations and assets.
- Make changing passwords a mandatory weekly task for all employees
- Do not just leave cybersecurity to the IT department but hire/outsource the task to white hat hackers, aka cybersecurity experts
- Do not allow the usage of unregistered devices within the office network
- Make it so that only registered devices can access the company system remotely
- All online employee activities must be traceable, as long as they are operating within the office network and system
Lease Instead of Buying
Does it always make sense to lease instead of buying? The answer is no, it doesn’t. However, in most cases and when it concerns a small business, leasing business equipment, vehicles, and space simply makes more sense than buying.
You can keep a direct correlation between what you are spending and the revenue you are generating. Short leases allow you to complete a project or try out a business for a short while before relocating or even replacing your current field of business altogether, in case it doesn’t work out.
Buying will flesh out the losses if a company doesn’t work out, while leasing may keep you at a profit, even if the venture fails!
These three are solid, time-tested strategies, but as an additional measure, you may also want to keep aside a solid nest egg for the business.
Instead of reinvesting the lion’s share of the profits every year into the business, create an emergency fund, and divide a significant portion of the profits between the emergency fund and the reinvestments.