How to Safeguard Your Business against Disaster

Nobody wants to think about worst case scenarios, but it doesn’t help to live in denial. When you own a small business, you should have a backup plan just in case disaster strikes. The most important thing that you can do is be prepared. In this article, we’ll show you how to get this right.

Evaluate the Risks Your Business May Face

Determine the risks that your business is most likely to face and plan accordingly. The best way to do this is to perform a risk assessment. This will help you evaluate exactly how prepared your business is and improve where necessary. For example, how prepared are you for a medical emergency on your business premises? What do you need to align with health and safety guidelines? Take these factors into consideration.

Are You Completely Covered By Your Insurance Policy?

Once you have determined the risks specific to your business, you should make an appointment with your insurance broker to ensure that you’re correctly covered. If your insurance experts identify any problem areas then you may need to add additional cover. Ask your agent about business interruption insurance. This insurance will cover your business and help keep it running should you suffer loss of income after experiencing a disaster.

In addition, inquire about health coverage for business disruption. This coverage allows a company owner to continue paying on-going bills while his activities are shut down.

Consider Contacting a Forensic Economist

A forensic economist is a trained expert that predicts how the economy will perform. This analysis is done by assessing past and possible future income loss. They can predict how your business will perform based on your income, earnings and economic damages. They can predict loss of earnings or other potential shortfalls by looking at the bigger picture.

Consulting these experts, such as the Knowles Group, is a professional service that is worth investing in if you want to avoid unforeseen expenses, especially in legal disputes.

Think Carefully About Your Expenses

Every business will have different expenses based on your type of activities. Expenses such as the rent you pay, internet services and salaries will remain basically the same every month and are known as fixed expenses. In contrast variable expenses such as stock or materials purchased will change each month depending on the usage. To cut down on costs, determine if there are fixed costs that are unnecessary. You can priorities your expenses and reign in spending before disaster strikes.

Build and maintain a thorough, up-to-date number of goods and equipment and safe the stock files off-site, complete with photographs of each asset. In the event of a crisis, establishing regular back-up processes for vital software and data can help you to maintain access to critical files.

Be sure to study and rehearse it with your colleagues while you have your emergency plan in place. Create a routine of at least twice a year doing something so that workers won't forget. It is a smart idea to provide each team member with a copy of the schedule as well.

Reduce Your Debt As Much As Possible

It may be very easy to swipe your business credit card and worry about the payment later, but this is an unnecessary expense. Each month you get charged interest on your card that quickly adds up. Use cash as much as you can. When your business has a large amount of debt then you may want to consider consolidating your debt. This is when all your debt is settled with a large loan, so your business will only need to pay back the loan in easy to manage payments each month, rather than several beneficiaries. This saves money on interest, helping your business remain afloat.

Have a Data Backup Plan in Place

Every business should make sure that their important data is backed up regularly and stored in a safe environment. An easy way to implement this is to use the online cloud storage solution to store your data. Important documents such as original contracts and business licenses should be stored offsite in a fireproof box or at a bank in a safety deposit box.

If you don't store data in the cloud, but then make sure you backup system and data it off-site in a secure location. Relevant files should be kept in a fire resistant box or a bank lock-box, such as agreements, licensing requirements, corporate records, etc.

Endnote

Minimize the risk your business faces by being prepared and having a contingency plan in place. It might not be possible to foresee every risk that your business will face but having a backup plan will give you peace of mind; you’ll never have regrets or feel that you could have done more.