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Preparing for Bumps in the Road

8th June 2021

One thing’s for sure, there’s no certainty when it comes to business! There are always going to be bumps in the road to overcome. Sometimes they’ll be small, easy to negotiate ones, other times they’ll look like great insurmountable ones. 

Of course, none of us has a crystal ball and we can’t always anticipate what will happen in our future. However, we can make sure we’re prepared for as many eventualities as possible if the worst happens. 

The obvious first step

Whether you’re a sole trader or a large corporation, every business should have insurance of some description. It provides you, your assets and your employees with a safety net for things that you simply can’t control, such as accidents, equipment damage, health issues, even an HMRC inspection. 

The two main types of business insurance are employer’s liability and public liability. There are other types available, each covering a slightly different aspect of rick to be covered.  

The most important thing is to ensure you know exactly what your business insurance covers, so you can fill in any gaps and make any claims as watertight as possible. 

What do you do when things go quiet?

While having comprehensive business insurance in place is a good start, it’s not going to help with the general ups and downs in your market.  

If sales drop or your business is more seasonal, you need to make sure you can cover your costs in the quiet months. For example, you’ve developed an app that helps people get fit and healthy. There will always be more sales in January, May and September because these are the peak points in the year when most people think about their health and fitness. So, there needs to be a plan in place to ensure your business is still buoyant during the rest of the year. 

Forward planning 

As Benjamin Franklin once said, “If you fail to plan you are planning to fail”. 

When it comes to minimising the impact of bumps in the road, cash flow, planning and forecasting are great things to have in your business toolbox. You can read more about this in my previous blogs ‘Review Your Forecasts to Re-Energise Your Business’ and ‘Know Your Costs as You Re-Energise Your Business’. There are some great tips in both to help you see clearly how to plan for any eventuality.

Business reserves

Structuring your finances so that you have reserves to save as well as ready access to cash is something often overlooked when we start businesses. However, having this one fundamental plan in place is the difference between being able to ride any downturns and business failing because we had no back-up. 

This strategy will give you greater peace of mind and stop you from thinking you need to make potentially detrimental knee jerk reactions in slower times. It also means you are unlocking your ability to achieve your personal goals. With the business on a stronger footing, you, as the business owner, won’t need to work 24/7 just to keep your head above water. After all, you built this business to have the lifestyle you wanted – building reserves means you are able to start living that life. 

Contingency planning

As I mentioned earlier, none of us can know for certain what’s going to happen in the future. But there’s still a great deal of value to be had in casting your mind forward and planning for what could go wrong.  

It helps to look at this from a short, medium and long-term perspective. For example: consider what you would do if there’s a snowstorm or power cut (short-term events stopping business for a day or two); or a flood or a car crashed into your offices (medium-term impact on business function); or a global pandemic or economic crash (long-term impact). 

Consider impacts from a people perspective as well – if you get sick, for example or (less drastically) a key member of the team decides to leave.  

Now, of course you don’t need insurance for every possible eventuality, but it’s good to get some ideas and a plan together so you at least know what you would do if any of these short-, medium- or long-term situations occur.  

As this last year has shown us – anything can happen! 

At Grant-Jones we love to help our clients with future-proof planning and strategies to support them when bumps in the road occur. Contact us today if you’d like to find out more about how we can do this for your business.


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