No matter how successful your business is, having a Plan B is essential. Sadly, far too many companies fail to take the necessary precautions and overlook the importance of preparing for potential risks, and this can prove to be a costly mistake. Luckily, there are simple ways you can avoid being caught off guard when a crisis strikes. If you want to ensure your firm is properly protected should the worst happen, here are three things you should know.
Unexpected downtime can cost you big
A lot of the time, business owners are too preoccupied with day to day operations, meaning that they overlook the possibility of sudden disruptions. One of the most common causes of unexpected downtime is power cuts. The loss of electricity can put normal working procedures on hold and result in the loss of potential revenue, both of which can have a negative impact on your bottom line. Even a few hours of downtime could cost your company big in terms of lost custom. To ensure your firm is protected against blackouts, having a backup power source is an essential safety net that can save you precious time and money. To find out more about backup generators, you can visit the websites of specialist suppliers such as ADE Ltd.
Keeping your insurance up to date is crucial
As well as having basic business insurance in place, it’s important to regularly review your policies to ensure you have the right level of cover for your needs. Don’t assume that because you have business essentials like employers’ liability insurance in place that you are safeguarded against all potential risks. Make sure you understand what your policies include and exclude, and carry out a yearly review to check if they need updating. This is especially crucial if you are a start-up firm, as your circumstances can quickly change and you may find that the initial coverage you bought is rendered inadequate as your business expands.
A cash safety net can save you from disaster
Having emergency funds to cover unexpected expenses can help you to manage cashflow and keep your firm afloat if a disaster rises up out of the blue. For example, have you thought about what would happen if a key member of staff needs to take sudden leave, or a main supplier goes out of business? These types of problems can occur at anytime and can set you back several months or even shut your company down completely. With that in mind, having a cash reserve is a wise idea. It doesn’t necessarily have to be a lot either. Having enough money set aside to cover a few months’ worth of operating costs can be the difference between the survival or ruin of your business.
While you can’t always predict the future, it’s important to do your best to prepare for unforeseen problems. With a little bit of forward thinking and careful planning, you should be able to avoid costly surprises and protect your bottom line.