In these tough economic times, it’s important that you carry out all necessary procedures to safeguard your business. Money may be tight but competition is rife, so you MUST keep all cards close to your chest to protect the company’s future.
There are various ways that you can keep your business secure and no we’re not talking about putting up CCTV or an iron gate. Yes, your business should have measures for physical security but today we’re discussing ways to keep your firm financially secure and here are 6 tips brought to you by the team at Real Business Rescue.
1. Work with a lawyer.
Many small business owners only employ a lawyer when they encounter a legal issue. Of course you don’t need a lawyer for every single stage of the business and there are issues which you can handle on your own, however there are certain instances which definitely require an expert in the legal field.
In the following scenarios, you definitely need a lawyer;
- when negotiating the sale of the company
- local government investigating your business for law violation
- environmental issues in which your business is involved
- a former/current/prospective employee is suing on the grounds of discrimination
You need business insurance for protection; that’s a fact. Some sectors have a higher risk than others but is it really worth taking a gamble? Some company structures are liable for business tax deduction for having insurance, so it is worth getting.
If there is a risk that you can cause financial loss to a client, Professional Indemnity Insurance is applicable.
Employer’s Liability Insurance is compulsory for all businesses and covers you for any liability you may have for injury or death to your employees. However, limited companies are exempt if you are the only employee or you own at least 50% of the shares.
Cover yourself for any liability or death to third parties and damage to third party’s property as a result of negligence by you or your employees, with Public Liability Insurance.
3. Do things by the book.
One of the best ways you can avoid a financial meltdown or lawsuit is to do everything by the book. Keep all business bank accounts separate from personal use and don’t use the funds for anything other than business.
Make sure you pay the appropriate taxes to HM Revenue and Customs or you will face a penalty, or even worse, a jail sentence.
4. Copyright your work
If your business creates any original work, like photography or household products, make sure you copyright it with either the word ‘copyright’ or the © symbol. Also state the year of the first publication and the name of the business, to protect your business from trademark or patent disputes.
It will identify and distinguish your goods and services as your own.
5. Online information
Is your company data safe from computer viruses and hackers? You are just as vulnerable to cyber threats as large firms but you can stop the firm’s information from getting into the wrong hands.
Make sure all systems have up-to-date anti-virus software, avoid phishing emails, thoroughly screen employees before hiring them (especially if they are going to have access to financial company information), and secure your wireless network with a firewall. Be sure to back up all the data and have an internet use policy in place too.
6. Spend less than you earn
You’d be surprised at how many firms go under because their overheads outweigh their income. It is the golden rule of financing to not spend more money than earn. Even if you are paying off debts, retain a see-saw balance of income and expenditure or you will eventually go bankrupt.
Use an accountant or financial software to track all payments and revenue, create a budget, stick to it, and if needs be, speak to a professional to find out where you can cut spending. It may be that you can reduce your corporate tax liabilities, get discounted rates on suppliers, or simply improve cash flow with factoring and invoice discounting.
So there are 6 sure-fire ways to keep your company financially secure. Times are tough but burrowing your head in the sand won’t make your money woes go away.
It’s imperative to tackle the business’s debt issues head on because believe it or not, there may be a light at the end of the tunnel.