Nobody wants to imagine things going wrong, but you just can’t overlook the risk involved when you are a business owner. Chances are, you will have to deal with unexpected obstacles, challenges, or even natural disasters at one point or another. What matters is that you’re prepared and ready to tackle these problems when the time comes. That said, how can you prepare for business mishaps? It is impossible to identify every single business mishap before they occur. However, you can take a few steps to protect yourself and your business from such issues, be it financial problems, human difficulties, or natural disasters when they arise.
Are your employees happy with the work environment? Do you have an emergency fund for times when business is slow? Does your business keep confidential information that could cause a lot of damage when leaked? Business mishaps are unforeseen and unexpected. But the more you consider them in advance, the more time you’ll have to deal with them. Some scenarios you should think about include;
- Death of a key executive
- Equipment failure
- Financial disaster
- Disgruntled employees
Let us take a detailed look at a few steps you can take to guard your business against the unlikeliest of mishaps.
- Analyze Risks
Whatevery business owner should do is think about every possible business mishap that their company might face in the future. That includes financial disasters, human errors, and natural disasters. For example, if you are in a natural disaster-prone area, you could always rent an off-site storage unit to guard your business assets against bad weather conditions. For instance, Texas has seen its share of hurricanes recently. So, if you’re running your business operations from somewhere in Texas like Prosper, go online and search for storage units prosper TX to acquire safe self-storage units to protect your assets.
- Develop An Emergency Response Plan
Running a safe and secure business environment means purchasing safety equipment and performing maintenance to ensure they function when required. Furthermore, marking safe exit routes and creating an emergency response plan for mishaps such as power failure, fire, or other problems is a no-brainer. Moreover, it is also ideal for businesses to rehearse their emergency response plan a few times a year with their employees to ensure its effectiveness.
- Backup Your Data
These days, since every business process and business data is digital, relying on a single server for critical information or document is a recipe for disaster. So, consider backing up your data on multiple off-site servers to ensure you maintain its integrity if a particular server fails. Also, a good practice is to backup your data on the cloud to eliminate the need for physical storage. Doing so will allow precious business data to remain safe if a power or equipment failure wipes out your local servers.
- Create An Emergency Fund
The financial implication of an economic mishap can be detrimental to your business. Depending on the situation, you might have to issue refunds to customers, replace damaged or lost inventory, renovate your office, or close business operations temporarily. That is why every business should have an emergency fund that will allow them to cover at least three to six months’ worth of business-related expenses. The emergency fund should be enough to cover expenses such as mortgages, rent, utilities, payroll, inventory, and loan payments. Building an emergency fund takes time. However, a few sacrifices and strategic changes will help you build a sufficient one.
- Acquire The Right Insurance
Quality business insurance will allow you to tackle unforeseen business mishaps such as a fire, flood, equipment damage, and much more. It is all about choosing the best insurance policy that allows your business to continue its operation even after suffering from a mishap. Ensure that you acquire a robust general liability insurance policy and consider obtaining other policies such as equipment insurance, cyber liability insurance, or disaster insurance. Get in touch with an insurance provider to know which policy will be the most effective for particular mishaps.
- Don’t Rely On Just One Person
Suppose only one person knows how to access your business accounts or your emergency servers. In that case, chances are your entire business will come to a standstill if that person isn’t present or, worse, gets into a life-threatening accident. Ensure that multiple individuals have access to your serves and account passwords. On the other hand, you should ask a trustworthy employee to keep an eye on these individuals to prevent unauthorized access to your business accounts or services.
- Know What Resources You Can Utilize
Investigate federal, state, and municipal resources available when facing a financial mishap or natural disaster. These include unemployment benefits for employees if your business closes down, state-wide disaster recovery funds, and low-interest SBA loans to cover equipment damage due to natural disasters like fires, floods, hurricanes, or earthquakes.
- Set Up A Chain Of Command
Nothing will make a situation more difficult when your employees have no one to turn to during your absence. Every staff member should know who to contact when a business mishap strikes, be it a natural disaster, financial issues, employee altercations, etc. When you have a chain of command, your employees will rest assured that someone is always around to talk to when a mishap occurs. Setting up a chain of command prevents a small business mishap from turning into a huge catastrophe.
- Hire An Attorney
Hiring an attorney will allow you to prevent unnecessary lawsuits from your employees and customers. An experienced attorney will also enable your business to retain compliance with federal and state employment laws. Furthermore, a tax attorney can help you remain protected from unnecessary tax audits from the IRS. Furthermore, if you’re a victim of a wrongful lawsuit from a customer or employee, an attorney will represent you in court and ensure you get the best possible results.
Mishaps are learning opportunities. Instead of contemplating what could have been, think about the strategies that worked during tough times, including the policies covering your business’s financial losses and protecting your employees. Next, identify the areas of your business that saw the biggest losses and ask yourself what you can do if the same things happen again. Being prepared will ultimately allow you to remain unscathed from any business mishaps that might occur in the future.