Every business and the industry it occupies will face different, unique challenges when it comes to its finances but these are few and far between. What we want to look at are the common unexpected expenses – the type that can shut down your operations (and could lead to the death of the business).
Here are a few examples:
- Theft/loss of inventory
- Slow scaling/growth
- Employee departures
- Improper record keeping
- Logistical mishaps
- Unexpected fees and/or legal troubles
There are many ways to combat these unexpected expenses (which are tied to each item in the list); these are but a few methods (though certainly do additional research and diligence when finding the right solution to the problem):
Instances which relate to financial strain as the result of inventory, logistics, record keeping, and sudden legal troubles can often be fixed through small business loans. However, not every business has this line of credit (nor would you necessarily want to take on too much) which is why small, installment loans can be the right solution.
MaxLend.com, for example, is one such service that provides payday loan alternatives by replacing them with smaller installment loans – just enough (a maximum of $1,250) to jumpstart the business. This smaller amount can help with restocking, covering additional shipping expenses, and/or handling small settlements as the result of legal issues.
Instances which relate to scaling/growth and employee disrupts can be quickly alleviated through social media, recruitment services, proper investing, and documentation.
Social media comes to the rescue as far as employment goes such as when using LinkedIn which puts you in direct contact with professionals to fill key roles in the business. Those that cannot bother with social media may want to look toward recruitment services for temporary workers which may lead to full-time positions.
Of course, proper investment of the business funds are what you should rely on when there are disruptions in the financing (such as trouble paying vendors or employees); investing adds to stability and diversification in the same way you’d do for your personal accounts. While you’re at it: make sure to document everything so if an employee were to suddenly leave they aren’t leaving with the only knowledge of doing said work – documentation allows you to pick up right where they left off.
Are these all the ones you’ll face as a business owner?
No, but it’s likely that a few will happen over the lifetime of your business and your involvement so it’s better to learn (and plan) for them now than being blindsided when they happen in the future.
Moral of the Story: Be Prepared
Those that claim their business is running as smooth as possible is simply lying through their teeth. There will always be unexpected events when operating a business. These events may not happen now but they’re bound to happen because, in the end, it’s a numbers game – you’ll reach a point in your business timeline that chances grow exponentially.
However, that’s not to dissuade you from taking chances.
Your best bet is to be prepared:
- Know the common pitfalls of your industry
- Create a support network for quick rebound
- Develop a plan of action
- Tap into the available resources
A good business will survive when its owner takes a rapid reaction to the unexpected business expenses.
Will you be the type of owner to do so when faced with these challenges?