Disclaimer: This is a contributed blog post for my #GIRLBOSS Sessions series. Enjoy!
The last thing we want is for our business to suffer some kind of disaster that would hinder its operations or even destroy it entirely. For example, a natural disaster or some freak weather changes can quickly wipe our business out physically, or it could take down a local energy grid and completely stall our operations. Business continuity is an important consideration to keep in mind, but just how do you prepare for every potential case?
Business Continuity Planning
The first line of defence is to plan for business continuity. This essentially means that you have some form of plan ready to execute when something goes wrong in your company. The “something wrong” can be virtually anything. From an employee getting sick to a manager leaving the company, the idea is that you should be prepared for virtually any possible situation and have backups ready in case something fails or needs to be replaced.
Creating a business continuity plan involves researching all the potential failure points of your company. From a lack of income due to your business being seasonal or a potential cyber attack that steals your customer information, it’s not easy to list all of the dangers on a single hand. You need to correctly recognize how businesses fail and what causes a company to collapse in the first place. Without correctly recognizing these threats, it’s hard to plan for business continuity.
We would recommend reading through articles such as this one titled “50 Reasons Why Some Businesses Fail While Others Succeed”. It’s a massive collection of reasons why businesses fail and many of these can actually be planned ahead for in your continuity plan. It doesn’t go into huge depth with each point, but it does give you some basic ideas of how a business can fail and what can be done to overcome it.
For example, one of the reasons is a lack of capital. This is difficult to guarantee especially if your business is new. You have no idea how much profit you’re going to make and you’re probably not going to be sure how seasonal your business is based on just a few months of operation. As a continuity plan, you’ll want to learn about how a working capital loan works. This will basically be a loan to help keep you afloat. Whether it’s to pay off business debts or pay for expenses like rent and salaries, a loan of this type is an essential component in any startup’s continuity plan.
For any aspiring entrepreneurs, recognizing failure is far more difficult than learning how to succeed. However, if you embrace failures and learn from them, you’ll grow much faster as an entrepreneur and your businesses will become that much more sturdy and profitable. It’s hard to think of all the potential failure points of your company so that you can plan around it, but it’s better to study in advance than to experience it firsthand.
Featured image by Corrine Kutz.