Whether you’re just starting your SMB (small-to-medium-sized business) or you’re a seasoned veteran, it’s crucial to establish proper safeguards that protect all your hard work and investments. As small business owners, we are all too familiar with the unsettling statistics about businesses failing within the first five years. The top reasons often revolve around failure to listen to customer feedback, inability to adapt to consumer demands, ineffective marketing, and mismanagement of resources. These stumbling blocks are common knowledge, but what about the underlying safety measures that can help stabilize your business during challenging times? In this beginner’s guide, we will explore fundamental ways to cover your assets and keep your SMB thriving.
Section 1: B2B (Business to Business) Background Checks
Picture this…you have a brilliant idea for a new product line and find what seems to be a reliable source for materials. However, you find yourself in a situation where your source fails to deliver, leaving you unable to fulfill orders. This is a common and tragic tale among small business owners. To avoid such heartaches, it’s essential to conduct thorough background checks on any businesses you consider working with to supply services or materials for your products. By doing so, you not only protect yourself, but also your customers and your business from potential pitfalls down the road.
Section 2: Separate Bank Accounts
If you’ve been running your SMB for a while now, you may already have a separate bank account dedicated to your business. However, many startups initially keep everything in a personal account for various reasons. If this resonates with you and you’re starting to see an increase in business income, it’s time to make a clear distinction between personal and professional banking. Take proactive steps to separate credit cards and bank accounts into specific business products at your bank. Establishing a business bank account offers numerous benefits, including extra security for your finances and perks like automatic alerts, online bill payments, flexible overdraft protection, and even the potential to receive a line of credit. Segregating personal and business finances is crucial to maintaining long-term success.
Section 3: Business Insurance
Business insurance is often a controversial topic among small business owners. Some startups believe they can’t afford insurance, especially if they are taking precautions to prevent incidents in the first place. While this perspective is understandable, it’s important to consider the potential consequences if something does go wrong. If you don’t have enough funds for business insurance, it may be wise to delay opening your doors until you do. Insurance can be a lifesaver when it comes to protecting your assets, customers, and investments. While it doesn’t create an impenetrable bubble, it can safeguard your business from fraud, theft, and various other risks.
Section 4: Prioritizing Cybersecurity
Arguably the most critical precaution you can take for your SMB is ensuring the safety of your technology. While this may seem like an obvious security measure in today’s digital age, small business owners often overlook these essential details amidst their busy schedules. To protect your business and its information, conduct a thorough cybersecurity check on your computers and networks. Ensure that you have a top-notch firewall installed and keep it updated to ward off potential threats. Verify that your antivirus software is current, functioning correctly, and capable of detecting security breaches instantly. Changing passwords periodically and using strong, hard-to-crack passwords is crucial. Additionally, consider investing in an external data storage system to back up all your business’s information. While you may never experience a hacker crisis or system shutdown, taking these steps can save you and your business from significant trauma if such incidents occur.
Section 5: Employee Security
If you have employees, it’s important to be vigilant about their safety and well-being. However, it’s equally important to protect your SMB assets from accidental or intentional theft or damage. Granting digital badges to your employees can give you control over access to various areas of your business. You can also adjust permissions in the event of an employee termination, safeguarding your company’s equipment and data from potential security breaches. Furthermore, protecting your employees from harm is vital to shield your business from potential lawsuits. Employee injuries, no matter how minor, can lead to legal repercussions. Take the initiative to identify hazards in your office and warehouse facilities. Consider obtaining an OSHA certification to double your efforts in protecting both your employees and your assets. Occupational Safety and Health Awareness courses provide essential training and resources to enhance job-site safety, ultimately fostering a happier, safer work environment and long-term business success.
Section 6: The Impact of Hiring an Accountant
While you may be adept at numbers or even possess an accounting background, filing your small business taxes on your own can be time-consuming and prone to overlooking crucial details. Moreover, staying up-to-date with the latest regulations and codes can be challenging. Hiring a certified public accountant (CPA) dedicated to your business’s success can save you valuable time and provide peace of mind. Consider investing in accounting software to further streamline your business’s financial management. Although spending extra money on an accountant or software may seem daunting, it’s important to remember that even a single accounting mistake can attract unwanted attention from the IRS, leading to audits and potential troubles for your SMB.
In conclusion, the key to ensuring your SMB’s success is preparedness. Reflect on the long hours, hard work, and financial investments you’ve poured into your business. Now envision all of that being flushed down the drain due to one unforeseen twist of fate. To prevent such a scenario, it is crucial to implement preventative measures that solidify your business’s safety. By following these comprehensive tips and precautions, you can protect your business, customers, and employees, mitigating potential disasters and ensuring long-lasting success for your SMB. Remember, leaving anything to chance is not an option when it comes to staying on top.