By Dixie Somers
Starting your own business is a prestigious accomplishment, and a shot at working for yourself and doing something you care about. As an entrepreneur, you’ve got plenty of concerns on your plate, and must handle problems as they come. While there are no guarantees for business success, one easy way to avoid an early end to your entrepreneurial dreams is to take extra precautions in order to lower any risks to your business. Business is naturally risky by its deal-making nature, so if you’ve chosen to take on this venture, or you’re contemplating it as a future move, consider these five tips to minimize risk before you take the plunge:
Front Load Your Efforts
Failing to plan is planning to fail. The more planning you do up front, the less scrambling and fumbling you’ll do later, and the more likely you are to have a mindful plan of action to follow in a time of either victory or despair. If you’ve seriously thought of starting a business, you no doubt have been working on a business plan. When you are really ready to launch the business, break that plan down even more so that it includes intricate details, specific information, deadlines, and projections. If your business has already launched, compose a comprehensive strategic business plan annually, and then stay on track by getting your staff on board.
Partner with an Expert
According to the professionals of GOLD SRD who specialize in professional development, you can make minimizing risk part of your long term strategic plan by working with an internal auditor who can evaluate risks for your company. In addition to assessing risk factors, internal auditors can help ensure compliance and regulation processes are met, aid in efficiently prioritizing response to risks that are identified, and improve the success of responses to risks that occur and result in adverse effects. If you struggle with the finance side of running a business, don’t go it alone. Hire a professional who can give you an accurate update of where the company stands, and warn you of any future risks based on market trends, economic factors, or company spending.
Microsoft is one of the most successful companies ever, but its record of success hasn’t been without its own fair share of flops. Microsoft’s silver lining is its ability to maximize its successes. You can copy this tactic by being fully staffed to provide excellent customer service, and continually working towards improving business processes. Yes, your business will have weaknesses. These weaknesses should be assessed and fixed, but don’t forget about your strengths. Maximize your strengths so that you don’t leave the company as vulnerable if disaster does strike.
Business is Business
Becoming too emotionally wrapped in a project or contract can lead to costly poor decision making. Stay objective and document your progress towards goals. Early detection and response is essential to cutting risky business off at the source. Yes, you’ll be emotionally attached to your business—especially if it is a cause you are passionate about. However, having partners and employees who can give you perspective and keep you from making choices based on emotion will ensure you don’t do anything you’ll later regret.
Know when to Cut Your Losses
Set a threshold of how far you’re willing to extend your business assets and your personal investments, document this information, and then commit to sticking to it. If you find yourself wanting to push the threshold, discuss your options and have your risks assessed by an expert before making that decision. Many businesses run into problems when they don’t stick to budgets, plans, and other standards that have been previously decided on. Yes, sometimes you have to break from the plan, but other times you need to stick to your boundaries and know when to cut your losses in order to save your business.
The success of your business is up to you. Business habits aimed at minimizing risk can go a long way towards your success and are worth investing the time and energy into. Plan, audit, document, commit—and succeed!