From the very moment you decide to take the leap into entrepreneurship you entered into a world of risks – some you are aware of and some you have no idea even exist, as you waltz around in blissful ignorance. You know doubt feel serious levels of pride when you look at your business card and read the word business leader or founder or whatever it says, but what you should be reading is the world “risk-taker” which tends to be nestled somewhere between the lines.
Yes, your job is to take risks, to step outside your comfort zone and innovate, and to keep pushing upward until you reach the stratosphere. But it is also your job to protect yourself and minimize the damage that can be caused by risk. It is the double-edged sword of business.
Luckily for you, we have come up with some ways that you can effectively do this:
Be Aware Of Your Cash
The biggest risk your business faces is a financial risk. It is the improper management of your cash flow. It is not being aware of what you have and how long it will last. That is why we urge you to calculate just how much money you have at the end of each month, and just how long that will keep you in business should everything go south. To really minimize your risks on this front, you will want to have a contingency plan that consists of at least three months operating costs. You should also plan for certain scenarios, such as what would happen if you lost your biggest client and which expenses could easily be cut. You may find these two things are very closely linked.
Know Where The Risks Are
Every business has its own set of risks – risks that are very specific to the way they operate -and these are the things you really need to concentrate on. It could be that your business holds sensitive information and third-party that your clients expect to be protected, which is where an IT support can really help you minimize the dangers. It could be that your business success relies on a secret ingredient or process remaining secret, in which case making your employees sign NDA’s could be the best way to protect yourself. Perhaps you’re worried that your employees could take your business plan and go solo, stealing your clients at the same time, which is where a non-compete clause will be most beneficial. It could just be specific liability insurance.
When You Change So Should Your Protection
In order to keep thriving and surviving in the cutthroat world of business, it is vital that you have the ability to adapt and change. Of course, this can leave you open to risks because you may well have forgotten to update your insurance. This is not good. That is why you need to schedule a chinwag with whatever trusted insurance broker you have on your speed dial and discuss how your business has changed, what new products it has brought out, or what new services it offers and see how your coverage may need modifying.