Have you ever had an opportunity that looks like a good deal but you couldn’t take advantage of it?
How did you feel?
You felt lousy. You almost fell sick in your stomach. In fact, I bet you felt irresponsible.
This kind of feeling can be avoided with correct planning.
Heck! What am I even trying to say?
Every business passes through teething stage where it’s trying to find its feet and stabilize.
A business’ stability or strength during this period will be based on CASH FLOW and structure.
Cashflow in the sense of money flowing in and out of the business. Money needed to continue to meet up with DAILY COST of running the business.
At this stage, retaining as much of what you’re making in revenue is very important.
In fact, that should be your focus at this stage of growth in your business.
Life can happen to your business.
You can get sick. This will cost you money.
You can get incapacitated. This can halt or totally end the business.
You can get sued and slapped with a huge fine. This can greatly set your business back.
You can have your stock or goods destroyed by 🔥 or carted away by burglars. This will definitely cause you a loss.
You can lose experienced employees when you can’t pay their wages due to these losses.
It should be obvious now that the less prepared you are for these scenarios and many more of its kind can make your entrepreneurial dream go up in smoke.
To seriously cancel out the financial effects of these various setbacks and stay on budget as a business you need to adopt a system that will help.
This system and idea that you should consider is Risk Management and Insurance.
What is risk management?
Risk Management is the identification, assessment and handling of potential risk to your person or business which may lead to financial loss.
Insurance is a very effective method of managing risk which involves transferring the possibility of a financial loss to another entity called the insurer for a fee called premium.
Are you with me so far?
Shall we continue?
Now, there are various parts of your business that are prone to risk and could lead to loss of money you don’t have. 😉
These parts are:
1. You, the entrepreneur.
2. Your employees even if they are just two or three.
3. Your products – stock of goods/ professional advisory as a service.
4. Your shop, warehouse or office premises.
Do you know that as these parts have risk so they also have insurance coverages that will cater for them without costing you an arm or a leg?
Say tell me more!
What are the risks to your person?
1. Sickness: minor or critical illness
2. Accident: domestic or non domestic that may lead to body injury, temporary or permanent disability
3. Death: the finality and there are loved ones who will be hard hit.
For 1 above, There is health insurance. For 2 above, there is Personal accident insurance.
What are the risks to and from your employees?
1. Personal accident: bodily injury and disability. This will cost your business based on employee agreement.
2. Death: this will cost your business compensation to their beneficiaries.
3. Violation of trust and embezzlement of funds or stock.
For 1 above, there is Group Personal Accident Insurance.
For 2 above, there is Group Life Insurance which is compulsory once you have minimum of 3 employees.
For 3 above, there is Fidelity Guarantee Insurance
What are the risks to your stock of goods or professional advisory service?
1. Fire and burglary incidence to your stock of goods. You can be sued for defective or harmful products.
2. For your advisory service, you can be sued by an aggrieved client
For 1a above, there is fire and burglary insurance.
For 1b above, there is product liability insurance.
For 2 above, there is professional indemnity insurance
What are the risks to your shop, store, warehouse or office premises?
1. Fire incidences that can deface or completely raze the building down.
2. Flood incidence that could damage things or lead to burst pipe that can lead to fire.
For this, there is fire and special peril insurance.
My fellow entrepreneurs, this is where you need to be accountable by using this knowledge to assess your current situation and take decisive actions to prevent stories that touch in your growing business.
Please note that these insurance coverages are very pocket friendly and proven to save you from financial loss and emotional stress that comes with these aforementioned risks.
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As an entrepreneur, would you like to know HOW TO TURN A STRANGER TO A FRIEND IN 60 SECS OR LESS EVEN AS A SHY PERSON with the aim of making a customer out of them?
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