Tips for protecting your business

Four tips on how to protect your small business and secure its future success and growth.

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15th August 2012 at 12:15 pm

Setting up any business is always a risk. You’ve probably put a vast amount of your own savings into the venture, as well as having to borrow money from various sources. Whether you secure funding from the bank or from investors, a lot will be riding on the success of the business first establishing itself, then growing and evolving.

With that in mind, you need to put adequate safeguards in place. Here are four tips to do just that.

Secure your cash flow

Once up and running you need to think about your cash flow. A full order book doesn’t necessarily add up to money in the bank – the valuable capital you need to keep your business growing and evolving. At this stage it’s worth investigating your options, to release your existing cash flow.

One of the best ways to do this is to unlock capital with Aldermore Invoice Finance. Choosing a solution such as this, you can receive up to 90% of your unpaid invoices immediately, receiving the rest (minus a small admin fee) when your client pays the invoice. There are also options whereby they’ll control your sales ledger (factoring) or you contact your clients yourself to secure the funds (invoice discounting). This will protect you against bad debt, giving you the comfort to know you can readily access those funds tied up in invoices, as well as much cheaper and more flexible than an bank overdraft.

Secure appropriate insurance

All businesses need insurance. For example, if you provide services or advice to clients it’s imperative that you are covered by professional indemnity insurance, as this will protect you against any claim that you were negligent in the advice or services provided.

Once your small business starts to expand and you have a requirement for employees, it’s integral to have employers’ liability insurance. This is required by law to cover all duties of health and safety towards your members of staff.

Ensure you have IT protection

All businesses operating online are susceptible to attack, making it vital that you protect your company data and that of your clients. You can do this by password protecting systems, configure and review internal and external firewalls, install comprehensive anti-virus protection, and physically protect your workstations and equipment from potential theft or misuse.

Comply with legislation

All small business owners need to be aware of their obligations under the Data Protection Act. If you are processing customer data, you’re obliged to inform the Data Commissioner, as well as keeping it encrypted, providing customers with the data you hold on them if requested to do so, and complying with obligations in relation to using the data for marketing purposes. Ensuring you comply with the Act is a quick and easy process, but failure to do so can result in a substantial fine. You wouldn’t want your business to fall apart due to a simple administrative error.

Jane Tchan

Jane Tchan is editor of SmallBizPod. She has more than 30 years of experience gained from working across a diverse range of industries, including tourism and leisure, retailing, sports sponsorship and food. During that time she has edited a variety of publications and online media http://www.smallbizpod.co.uk

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