When you’re launching a new business, you have plenty of things on your mind, and it’s easy to get distracted by the kinds of things you’d get set as a school project – choosing a brand name, a logo, and so on.
However, it’s important to be grown-up about your new business venture, to give it the best chance of succeeding in a cut-throat world.
Here are five of the top things to consider, each of which has the potential to protect you against unruly business practices, and put you on the path to success.
1. Credit Control
Good credit control starts before you even agree to take on a new client, so it’s really never too early to introduce it to your business.
Run background credit checks on new customers to flag up any risks, stay on top of your invoicing, and don’t let people get away with paying late (or not at all).
Your cash flow must be kept flowing if your business is to survive in the long term, so make this your number-one commitment from day one.
If your business is based around copyrights, trademarks, patents, protected product designs, or any other kind of intellectual property, protect it.
Whether through honest mistake, well-meaning imitation, or outright fraud, other businesses may encroach on your profits from time to time. Don’t let them.
3. Terms and Conditions
Particularly if you’re a very small business, getting a set of terms and conditions drawn up can seem like an unnecessary expense, but without them you’re at much greater risk of suffering a loss.
Make sure your T&Cs include clear payment terms – 30 days or even less where you can get away with it, to keep your cash flow topped up – and don’t be afraid to enforce these terms in your credit control practices.
4. Protect Yourself
Know what needs insuring, and insure it. That means the mandatory protection – like public liability insurance or professional indemnity, if you need it.
But also consider business premises insurance in case of fire, flood or vandalism, and if you’re a sole trader, possibly income protection plans for if you’re ever injured or off sick for a long period of time.
5. Plan B
Eventually, something will go wrong. If you launched a business in 2007 for instance, a global economic crisis followed soon after – fingers crossed that doesn’t happen again for a long time to come.
On a smaller scale, look out for signs of suppliers on the brink of insolvency, or customers failing to pay – you may be one link in a supply chain that’s out of your direct control, but you should have a backup plan so you don’t suffer when the weakest links become apparent.
If you would like to talk to a member of our team about credit control, payment terms or anything to do with debt collection please don’t hesitate to call 0808 256 1877.