Every business is at risk of universal and industry-specific threats that can impact its operations, revenue, and image. It is management’s responsibility to identify the potential risks and develop an effective crisis management plan to prevent an issue or bounce back, should it become a reality.
Read this article to find out about the five major threats to your business and how to stop them.
- Cyber Threats
Cyber threats have become a primary concern for SMEs and large organizations, and the risk is now greater due to the rise in remote and hybrid working environments since the pandemic. As employees might access business accounts and files from personal devices or public networks, it is more important than ever to strengthen your cybersecurity to prevent an unwanted data breach.
Find out how to protector your small business wifi from hackers, such as by encrypting data or using two-factor authentication. If you don’t, your business could become vulnerable to ransomware, experience data theft, or endure disrupted operations.
- Supply Chain Disruption
Your business is only as strong as its supply chain. If a supplier or vendor goes out of business or experiences a business disruption, your company could pay the price.
Safeguard your organization from supply chain issues by diversifying your supply base, which will ensure your company isn’t reliant on one third-party organization. Also, introduce risk evaluation tools to identify potential problems before they become a reality and develop a supply chain emergency plan to help you bounce back, should the worst happen.
- Innovation Failure
In today’s modern world, companies must stay one step ahead of their industry rivals to secure sufficient customers, lower their overheads, and increase their sales. Even if your brand is a market leader, you must introduce new tools and technologies that streamline tasks, solve customers’ problems, and lower your expenses. If you fail to innovate, your competitors might introduce new technologies and tactics that will allow them to gain an industry advantage and secure a larger market share.
- Legal Liabilities
It doesn’t matter if you run a home-based business or a large organization, your company will be at risk of various legal liabilities. Discrimination allegations, wrongful termination cases, and accident claims are examples of the many lawsuits your business might face during its lifespan.
Protect your company’s finances by investing in various insurance policies, which may cover the cost of a possible lawsuit and any successful compensation claims. Good examples of liability insurance include:
- Public liability insurance
- Employer liability insurance
- Professional indemnity insurance
- General liability insurance
Inflation is a real threat for many businesses at present. A price increase for goods and services may affect your company’s profit margin and future. Protect your business from inflation by finding ways to lower its expenses, such as:
- Streamlining processes
- Restricting internal spending
- Optimizing the supply chain
- Reviewing productivity levels
- Reducing bad debt
- Embracing technology to minimize overheads
- Hiring employees cautiously – recruit the best person for a vacancy
The above major threats can affect your company’s sales, reputation, or productivity. Yet, every problem has a solution, which is why you must identify the potential risks to your business and find the best tools or tactics to prevent them.