How to keep business risk low
If you become self-employed, you always take a certain risk.
Few tips on how to keep business risk low
A professional business plan
With the help of a business plan, you create a structured list of your business idea.
In addition to a marketing and sales plan like advertising in trending celebrity news magazines, the business plan also includes a financial plan, which shows you how much start-up capital you need and how long it will take for your business to make an income.
The right type of company
When choosing the type of company, you can already limit your liability enormously.
A corporation, for example, is “only” liable with the paid-in capital, i.e. the liability capital.
If you decide on a partnership, you are also liable for your private assets.
The advantage of the limitation of liability is of course that your business risk in the event of bankruptcy only relates to the capital that you have deposited in the company as equity.
The disadvantages of limited liability are that your credit limit is always lower than with private liability. In addition, the interest for “debt “, including overdrafts, is always higher.
Definition of the line of business
With the business plan, you define your target group. It is important that you commit to this and not expand your line of business indiscriminately. This means that you only focus on your business idea and follow it through consistently.
Planning the work processes
Once you’ve established your line of business, the next step is planning your workflow. This includes, among other things, the procurement of the goods and the associated terms of payment or delivery and how you ultimately deliver the goods to your customer or provide your service.
You should define these processes in advance and record them accordingly in the business plan.
Customer care and acquisition of new customers
Make a plan for attracting new customers so that you can always expand your customer base.
It is not only important to gain new customers, but also customer care. So you should keep your customers happy. Personal contact between you and your customers is important. Let your customers give you feedback to determine their level of satisfaction and, if necessary, to get suggestions for improvement.