Common Business Risks and Sure Ways to Minimize Them In Nigeria
Common business risks are enormous. Everything that has advantages has risks associated with them. Business has risks ranging from small to major because its major aim is to make maximum profits.
The benefits of owning a small business brings with it its fair share of risks. Phenomena such as accidents, natural disasters and theft can necessitate serious loss of money; bring liabilities in the legal form and heavy strains.
All hope is not lost though as you can protect your enterprise by identifying those risks and taking steps to cushion their effects.
Issues necessitate solutions. Common business risks mean that there has to solutions to solving the outcome of these risks. More so, there can also be preventive measures pit in place to mitigate the effects of these common business risks when they do occur.
Here we will take a look at these common business risks in Nigeria on one hand and we are not just going to leave you hanging there. We will also give you solutions for each risk on the other hand.
Common Business risks in Nigeria:
Here’s a look at five business risks and how you can help keep your headaches to a minimum:
Risk #1: Business interruption
Fires and other unforeseen events can force vulnerable businesses to relocate or close. Fire is mostly applicable to those running offline business while other unforeseen contingencies can affect you whether you are online or offline.
You may never experience fire outbreak in your business till you die. Some people in Nigeria have experienced it like thrice. You can never know and you don’t pray for it to happen. Being ready won’t hurt though.
For those that have computers with which they run their businesses and store their data, it is best you create a disaster recovery plan that includes data backup and recovery strategies, as well as plans on how to set up a remote location and alert employees to what’s going on.
Consider investing in business interruption insurance, which helps cover your operating costs and loss of income so you can help maintain payroll while you replace equipment and repair damage. This coverage typically provides reimbursement for up to a year of lost revenue.
Contact your agent or an agent if you don’t already have one. This is the best way to go in handling this aspect of the common business risks.
Risk #2: Property loss.
Your business property needs protection from the unexpected, just as your home does. You could lose certain property in your business. Why not ensure that it is not really a loss.
Audit your physical locations and business processes to identify and address areas of vulnerability.
Consider investing in a business owners’ policy to help cover damage to company assets that results from fire, storms and other disasters. These policies are available whether you rent or own the building you work in.
Risk #3: Injury
Workplace injuries can result in medical treatment costs and lost productivity. They can also inflate business insurance premiums.
As far as people are working, there is a possibility of injuries arising from very many means. It could range from fire injuries to other forms of injuries obtainable during work time.
Educate employees about workplace safety and ensure that you have proper workers’ compensation insurance in place.
This insurance provides wage replacement and medical benefits to staff members who are injured on the job. It also protects businesses from legal complications relating to workplace accidents.
Risk #4: Liability
Companies are at risk of lawsuits for accidental injury, libel or slander and other unanticipated results of day-to-day business.
Carefully designed business practices can help mitigate risks, but it can be difficult to guard against unknown future events. General, product and professional liability policies offer coverage for businesses that are exposed to specific threats.
These policies offer protection against third-party insurance claims. Talk to your insurance agent to see what kind of liability coverage your company may need.
Risk #5: Security breach
In today’s digital world, businesses can be instantly crippled by a loss of data or data theft. Cyber threat is real.
Map out a strategy to help protect your company data both on-site and remotely. If it would be difficult for your business to recover from a data loss, consider investing in data compromise and identity recovery insurance.
This can help to protect against loss or damage to computer equipment, data storage devices, electronic information, software and expenses related to data recovery. Your insurance agent can help you find the right policy and determine appropriate coverage levels.