Running your own business is both exciting and terrifying all at the same time. You have the potential to make it as great as you want it to be if you put in the time and effort it deserves then your ability to succeed can potentially be limitless. As wonderful as this sounds you need to know that you could, and most likely will, run into some unexpected business costs that could derail your entire company. Highlighted below are the 5 most common unexpected business costs that your company might encounter in its lifetime.
1. Maintenance
Business property maintenance can end up costing a pretty penny if something goes very wrong. Whilst it is recommended that you keep your property in top-notch condition, this can be a very large expense and it is difficult to prepare for. If you can, keep a safety net in your savings account for maintaining your property, it might cost a lot but it is a worthy investment.
2. Shrinkage
Shrinkage is commonly associated with the retail industry but it can affect virtually any type of business. If your business is experiencing high shrinkage, this will hurt your profits and ultimately the financial health of your business. To combat shrinkage, your business will need to be able to fork out for the high costs of implementing a good security system as quickly as possible.
3. Road Accidents
Motor vehicle accidents cost companies $60 billion annually in medical fees, lost productivity, vehicle damage, and legal fees. These massive costs could cripple your business. The common causes include drivers being intoxicated, driver errors, and insufficient driver training. If your business semi-truck is involved in an accident it is vitally important that you have a team of excellent semi-truck accident lawyers who can represent you and your company.
4. Equipment Costs
If you suddenly find yourself having to replace an integral part of your operational machinery you will know the enormous costs involved therein. Unfortunately, the best you can hope for here is that you have a regularly updated insurance policy that can cover most of the cost. If you do not have insurance, then the expense of this nature can bring your company to its knees. Cut other business costs where you can to save this money every month so that if your equipment does fail catastrophically, you will be able to replace it and be relatively unscathed financially.
Faulty equipment can cause a multitude of problems, from safety hazards to production delays. Getting into such a crisis cycle can be detrimental to your business, so it is important to have a plan in place for unexpected equipment costs. Furthermore, regularly maintaining and servicing your equipment can help prevent any unexpected failures.
5. Delayed Payments
Running your own business might seem simple enough but one of the biggest stumbling blocks you may come across is delayed payments from your clients or customers. Whilst this does not apply to all industries, having your payments delayed by even a few weeks can wreak havoc on your cash flow. The best way to avoid this is by charging a deposit when taking on bigger jobs – that way you know you can cover the basics until the job is complete and can receive the balance of payment.
