Home Forums Tell me straight… Identifying risks in small business

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  • #1000328
    johngray
    Member
    • Total posts: 4

    Hi, my name is john,
    As part of my small business course we are asking small business owners how you identify and manage risks in a small business.
    Thank you for reading this and for your help and advice.
    Yours sincerely,
    John.

    #1223908
    Paul – FS Concierge
    Keymaster
    • Total posts: 3,173

    We write policies to mitigate or eliminate risks.

    We train or provide training to avoid risk.

    We ban risky behaviour.

    We insure against risk.

    #1223909
    bb1
    Participant
    • Total posts: 4,485

    John, first thanks for your honesty for the reason for the question, so many ask, so many fail.

    You need to look at every aspect of your business, be it financial, operational, staff, etc, and determine what the potential impacts of any of them failing or having a problem is. Then work out ways to mitigate that risk, be it insurance as Paul mentioned, or another method. ie. it’s hard to ensure against a staff member not turning up today, so we have contingency plans in place.

    But you need to look at every aspect of the business, not just your primary function. to Take Pauls business as an example sure he needs staff, mops, cleaning products, etc. But things like his scheduling tool, invoicing systems are all also critical to that business, it is often these background things people forget.

    How dependent is a business on the owner, mine is 100% dependent, so what are the risks there, and how do we mitigate for them, yes insurance for being unable to work, but insurance doesnt keep the core function operating, it just gives your $’s. So how do you keep the core function going, I cant not turn up to clients for 6 weeks, without them looking elsewhere (says he tongue in cheek as that is what is happening here at the moment), but in a real life scenario I need to think how can my clients continue to be serviced.

    Taking Pauls business as an example what could a cleaner do wrong at a customer site, maybe accidently use a shower cleaner to clean that million dollar Rembrandt they have hanging, what strategy is in place for that scenario, I recently had a stone fly from my mower and break a car window (mine sadly), what then. I am using examples from services business, but the same applies if its retail, or any other business, think of every scenario that can go wrong.

    What if I run out of money, what if we are closed down for 6 weeks, what if I don’t find clients, what if my equipment fails, what if, what if, what if. Sit down and think of the 1,652 what if’s, and think about how you can mitigate the what if’s. Some you wont be able to mitigate, or wont be worth it, but you need to catch the big ones.

    #1223910
    johngray
    Member
    • Total posts: 4
    Paul – FS Concierge, post: 270638, member: 78928 wrote:
    We write policies to mitigate or eliminate risks.

    We train or provide training to avoid risk.

    We ban risky behaviour.

    We insure against risk.

    Paul – FS Concierge, post: 270638, member: 78928 wrote:
    We write policies to mitigate or eliminate risks.

    We train or provide training to avoid risk.

    We ban risky behaviour.

    We insure against risk.

    Thankyou Paul for concise and straight answer, this advice will definitely help me when running a business,
    Thankyou,
    Sincerely,
    John G

    #1223911
    johngray
    Member
    • Total posts: 4
    bb1, post: 270639, member: 53375 wrote:
    John, first thanks for your honesty for the reason for the question, so many ask, so many fail.

    You need to look at every aspect of your business, be it financial, operational, staff, etc, and determine what the potential impacts of any of them failing or having a problem is. Then work out ways to mitigate that risk, be it insurance as Paul mentioned, or another method. ie. it’s hard to ensure against a staff member not turning up today, so we have contingency plans in place.

    But you need to look at every aspect of the business, not just your primary function. to Take Pauls business as an example sure he needs staff, mops, cleaning products, etc. But things like his scheduling tool, invoicing systems are all also critical to that business, it is often these background things people forget.

    How dependent is a business on the owner, mine is 100% dependent, so what are the risks there, and how do we mitigate for them, yes insurance for being unable to work, but insurance doesnt keep the core function operating, it just gives your $’s. So how do you keep the core function going, I cant not turn up to clients for 6 weeks, without them looking elsewhere (says he tongue in cheek as that is what is happening here at the moment), but in a real life scenario I need to think how can my clients continue to be serviced.

    Taking Pauls business as an example what could a cleaner do wrong at a customer site, maybe accidently use a shower cleaner to clean that million dollar Rembrandt they have hanging, what strategy is in place for that scenario, I recently had a stone fly from my mower and break a car window (mine sadly), what then. I am using examples from services business, but the same applies if its retail, or any other business, think of every scenario that can go wrong.

    What if I run out of money, what if we are closed down for 6 weeks, what if I don’t find clients, what if my equipment fails, what if, what if, what if. Sit down and think of the 1,652 what if’s, and think about how you can mitigate the what if’s. Some you wont be able to mitigate, or wont be worth it, but you need to catch the big ones.

    Thankyou very much for going into such depth to give me a better understanding of risk and mitigating it, it truly seems to be a herculean task for those just stepping into new business, thankyou for giving me a fighting chance with your very informative response.
    Thankyou very much,
    Sincerely,
    John G

    #1223912
    UmarBatchelor
    Member
    • Total posts: 26

    When you walk across a river, your main concern is to get to the other side. There are many things you can worry about such as getting your clothes wet but you only need to worry about the most important things such as the risk of walking into a big hole you can’t get out of.

    Ask yourself what is your biggest fear that impede you on getting to the other side for your business (its not always money) then move on because of what FDR mentioned in his famous president inauguration

    https://www.youtube.com/watch?time_continue=13&v=ixCT6GDUZrs&feature=emb_logo

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