Three unexpected expenses that could have a big impact on your profit and loss statements
We all know that businesses create lots of different kinds of data every day. There is so much we can learn from every piece of data, whether it’s the number of sales made, the number of views you’ve had on a website, or even the number of likes you’ve had on a page on social media. The stark reality of business is that there is one piece of data that is more important than any other piece of data within your company. That piece of data is the profit or indeed loss your business has either made in the last week, month, or even year. While we can use existing data to try and predict how much profit you’ll make at the end of the year, there are a number of unexpected expenses that could have a big impact on this number. Here’s a look at three of those unexpected expenses and ways you can avoid them from happening.
Even if your business has been running for years or even decades, it could be the case that you’ve never been liable for any legal payments to customers or even your employees. The only problem is that accidents can happen at any time and change that fact about your business. If someone gets injured on your premises, you could not only be forced to pay for their medical fees but could also be forced to pay them compensation. This can have a huge impact on a business’s finances, no matter what size they are. That is unless you have insurance to deal with these problems. Find a business insurance company you can trust and make sure you choose a policy that covers any eventuality that might happen, no matter how rare and unlikely it is. It is far better to have too much coverage than find out you have not enough at the worst possible time.
Another reason you be forced to pay out a lot of money is if many people aren’t happy with your products. If your product doesn’t do what it’s supposed to, then your customer is within their rights to ask for a refund or to ask you to replace that product. That’s why it’s so important that you get the product right the first time. Whenever you design a new product, make a small number of prototypes and make sure they go through extensive testing before you make a large amount of them.
As well as looking after your customer, it’s also important to look after your staff. The process of advertising, recruiting, and then training up a new member of staff can cost a business a lot of money. To avoid incurring those costs, try and make your current staff feel as happy and valued within the business as possible. Regularly meet with everyone to check whether they’re happy and ask whether there’s anything they can do to help improve their time at the business.