The Best 3 Ways to Protect Your Business in Tough Times
By now, every business should understand how fragile the status quo can be. Whether it’s the economy at large, a single industry, or your individual business, the ground can shift at a moment’s notice.
You need to be prepared — and ongoing, proactive protection will always be critical to staying ready.
Most people know this in principle. But it is admittedly a lot easier said that done. Still, when the very life of your company may be on the line, there is no time for excuses.
So how do you keep your business safe and sound for the long haul? There may not be any 100 percent foolproof method. But the following three ways to protect your business will undoubtedly leave any company on solid footing.
1. Grow Slow and Sustainably
The triumph of Silicon Valley and tech startup unicorns in recent years have inspired so many business owners. This is great! Motivation is essential, and every entrepreneur needs to seek out success stories to emulate. But one problem is that many people now see runaway growth as the only path forward. If you’re lucky enough to double — or triple — in size rapidly, that can be fantastic. But overextending yourself to follow this path too aggressively can turn you into your own worst enemy.
There is certainly something to be said for expansion. Eternal stagnation should never be your goal. But you can get yourself into a lot of trouble if you contract the “disease of more” and always chase it at the expense of profitability and long-term financial health. Really, what good is it to have a ton of locations and employees if you still aren’t actually making money? Instead, only make investments and pursue growth for the right reasons. Remember: slow and steady can win the race — even in business. Think sustainability over some unrealistic vision of “success.”
2. Protect Your Balance Sheet
Even if you grow properly, maintain adequate reserves, and employ prudent financial safeguards, disaster can still strike. Sometimes, there is just nothing you could have done. There is a reason that natural catastrophes, for example, have historically been referred to as “acts of god.” This is why it almost always pays to have robust risk management practices and a good business insurance portfolio.
In many ways, small businesses are the ones most vulnerable to major, one-time, hard-to-foresee events. So you should always look for ways to hedge your biggest bets and biggest potential points of failure. The premiums you pay each month for certain types of insurance — like business interruption, natural disaster, and errors and omissions (E&O) — may feel like a big pain in the neck. But nothing is worse than seeing a decade of hard work go down the drain in an instant.
3. Always Prioritize Cybersecurity
While we don’t all need to operate like Uber, on some level, almost every business is now a tech business. Even if you just sell widgets or cut hair, you still probably use digital tools and communications to manage, promote, or collaborate in your company. This means that you must take steps to keep your accounts, networks, and data secure.
Strong password protection, access control, and data protection are all key. But even with good strategies in place, every organization remains prone to some lapses or exploits from savvy hackers. This is why many small and medium-sized enterprises (SMEs) have moved toward models like the Norton with LifeLock partnership to stay protected from cybersecurity threats and identity theft. At the end of the day, it’s better to be safe than sorry, and there are experts out there who can help keep you protected.
Protecting Your Business in Tough Times
These days, it’s hard to take anything for granted. There are always dangers lurking that can do great damage to your company. This is why you must do everything in your power to protect your business.
It all starts with your growth strategy and how much risk you are willing to accept. Prioritizing sustainability is usually a sound path and you can safeguard your finances with insurance. Then, because we live in a digital age, you must also prioritize cybersecurity by looking for assistance from key partners.
The business world will always be cutthroat. There is no guarantee of success — no matter how much effort you put in. But by employing the right strategies to protect your business, you will always be giving yourself the best shot to thrive.