Clearview National April 2020 - Issue 221 | Page 84

BUSINESS
Risk beyond your comfort zone
Successful entrepreneurs are risk takers, but their risks are both understood and managed.
This is the trick when running a business: not that you don’t take any risks. Rather that
you understand the risks that you are taking and try to keep them to a minimum.
» THERE IS AN OLD SAYING THAT
prevention is better than cure. When it
comes to business risks, that is definitely the
case. This article looks at some of the risks
that should be considered by anyone running
an installer business. Very often, taking
some simple actions can help avert a crisis.
Although most businesses won’t go bust from
these risks, some will even when they were
totally preventable. This article looks at some
of the cases where this applies.
RUNNING OUT OF CASH
The most common fatal problem for
businesses is running out of cash.
There are several ways this can happen. As
you grow you can lose track of profitability.
Costs might have increased significantly
without you noticing. Alternatively, you
might have started taking on unprofitable
jobs as people with less experience did the
estimating.
Almost the most upsetting is “over-
trading” when you are growing fast with
84 » A PR 2020 » CL EARVI E W- UK . C O M
profitable work. Then you run out of money
simply because there is too much work-
in-progress to fund ahead of finishing and
getting paid.
FRAUD AND THEFT
BY EMPLOYEES
Once I employed a young guy whose father
was a very senior business leader. I guess that
he was used to the expensive things of life.
We did wonder how he could afford his nice
new motorbike. When he went on holiday we
found out. He was stealing from us, selling
our software on eBay.
The police weren’t very helpful and didn’t
even ask eBay questions when they could ask.
As a result, we didn’t know the extent of the
theft which could have been tens of thousands
of pounds.
Fortunately, it didn’t take the company
down but persistent theft, not doing the hours
claimed and similar scams can badly impact
your business. In the worst case they can cause
it to fail.
It’s worth watching out for suspicious
behaviour or a lifestyle not justified by the
salary. In addition, spot checks on where
people are can help too. Alternatively, you
could use tracking technology from a company
like mine, Powered Now, to help confirm that
all commitments are being kept.
‘prevention is better
than cure’
The most damaging and most common
fraud is when the person who runs the
finances misbehaves. A red flag is when they
never take holidays. They may seem ultra-
loyal, but it is possible that instead they are
covering their tracks.
One way that I have tried to combat this
in my own businesses is to ask occasional
questions about items on the bank statement.
Knowing that you are following what’s going
on is probably the quickest and simplest way
of reducing the chances of fraud.