In the last few months, there have been steady businesses that have gone under due to the pandemic. Nothing spells disaster for a restaurant or other client-facing business like distancing restrictions. With the spike in cases throughout the US, there might be new lockdowns instituted in states like Pennsylvania. Managing disasters at a business is a part of running a company of any size. The management of these negative scenarios needs to be efficient and no rash decisions should be made. The following are business catastrophes that you might encounter that need to be managed appropriately.
Loss of Main Clients
Losing top clients at any business is something that a company needs to prepare for. Staying comfortable without signing any new clients is a recipe for disaster. You want to make sure that if a single client decides to end the business relationship that the business will stay healthy. Discussing with the client their concerns can provide a wealth of information. They might feel that the products or services they are investing in simply are not worth the price. Others could have had deadlines missed that they simply cannot forgive.
Legal issues can drain a company of cash flow due to legal fees being relatively high especially for longer cases. You do not want to find out that a partner or someone in accounting has done something illegal to evade taxes. A federal lawyer will be required as management/executives could all be at risk for being charged. You want to make sure that you are using an accountant that is licensed as you do not want any numbers fudged.
Partners Created a PR Nightmare
Partnering with other companies can create a juggernaut of a corporate entity. There is a chance that a partner could have created a PR nightmare that your business has been impacted by. The business is going to be viewed as negative if their partners are practicing unethically in business. The partnership agreement needs to have ethics clauses that will dissolve the partnership immediately. Your business doesn’t want to be caught up in a whirlwind due to a partner utilizing sweatshop labor. Doing a solid online reputation management campaign can work wonders for this. You want to push search results that mention your company in bad company as far down Google as possible.
Former Employee Stealing Clients
The employee NDA and non compete should be staples of the pre-employment paperwork. You do not want former employees to poach clients for their new business ventures or new employers. This is also why you should keep client contact between a few people rather than everyone working on a project. This will still happen from time to time but not at the level if you do not protect yourself legally with paperwork.
Dealing with issues in business should not be done with high emotions. Clear your mind before making any decisions and base as many decisions as possible on data gathered. Removing emotions and utilizing data can create a clear picture of what the business should do.