When you're running a business, your focus usually falls on the core components of profitability. You look at your cost basis—including your overhead and ongoing expenses—and the factors that influence your sales—including your price, market demand, and competition—that could influence your customers to shop elsewhere.
Unfortunately, these aren't the only factors that could determine your success. Your business is vulnerable to other, less predictable threats, and unless you're well protected, those threats could be enough to devastate your business.
The problem is that guarding yourself against these external threats serves as a line item on your budget by itself
. If you aren't careful, you could end up paying more than the measures are worth. The key is finding balance. You need to recognize the most significant threats to your business and defend against them as cost-efficiently as possible.
There are dozens of potential threats to your business, but many of them belong to one of four categories.
Data Theft or Corruption
According to a national survey by the Hartford Steam Boiler Inspection and Insurance Company
, 53% of businesses have experienced some kind of cyber attack just in the past year. Cybercrime, including the theft or corruption of data, is a major threat, especially for small businesses, which don't have much of a budget to protect themselves.
Physical Damage & Theft
If you have a physical enterprise, you might also be at risk of physical damage or theft done by your employees, customers, or others. If part of your inventory is destroyed or stolen, it could ruin your numbers for the month.
If you're found liable for something that happens to a customer or employee, such as a grievous injury, you could be sued for a significant sum. You'll want to prevent these incidents but also protect yourself if they do unfold.
No matter where you are, there's some kind of natural disaster that could affect your business, such as an earthquake, flood, fire, or tornado. These can wipe out your inventory and leave your business unable to operate at the same time.
Easy Security Measures
So, what can you do to protect yourself without spending a fortune to do it?
1. Install Security Cameras
Though a security camera system may seem complicated or expensive, the reality is you can set up a decent internet-connected system relatively easily
and for only a few hundred dollars. Once you have better monitoring standards in place, your risk of theft and employee negligence will decline, and you'll be better protected against liability claims.
2. Employ Better Digital Security Standards
Next, invest in higher security standards for your data and software. It doesn't take much to make a big impact here. Simply investing in better encryption, encouraging employees to pick stronger passwords, and educating employees on how to avoid digital schemes can dramatically reduce your risk of cyber threats.
3. Train Employees in Best Practices
Take the time and spend the money to thoroughly train your employees. Make sure they're well versed in best practices for online engagement and the safety and security standards you maintain for your business.
4. Invest in Better Locks
Your door locks are more important than you might realize. Just a few years of wear and tear or a single break-in could significantly reduce your lock's effectiveness
. Try to change out locks regularly, and invest in high-quality materials and installation.
5. Prepare for Potential Disasters
Know which natural disasters represent the biggest threat to you, and try to prepare for them. For example, if you live in an area prone to earthquakes, you should invest in a building material that's resistant to vibrations.
6. Get a Good Insurance Policy
Finally, and most importantly, invest in good insurance policies that will protect you from most of these threats. There are many types of business insurance
available, including disaster protection and liability, but the combination should help you mitigate the costs of whatever threats you ultimately face.
These security measures should only cost you a few hundred to a few thousand dollars in the initial setup, plus minimal ongoing costs (with the exception of insurance, which will probably cost a few hundred to several thousand a year
, depending on your business).
Accordingly, almost any business should be able to afford these measures. Be proactive and protect the future of your business; it's well worth the cost.
Larry is an independent business consultant specializing in tech, social media trends, business, and entrepreneurship. Follow him on Twitter and LinkedIn.
Opinions expressed by the author are not necessarily those of WITI.
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