Running a business is not a financial walk in the park. There can be many nasty surprises that can occur throughout the lifetime of the business. It’s important to do all that’s possible to help bring in enough money for the company. However, these unexpected costs can often hinder the progress being made by the business.
With this in mind, what types of business costs can come unexpectedly? Here are five types to look out for when running a business.
Workplace accidents
Workplace incidents happen and they’re fairly common. In fact, in 2020 in the private industry alone, 2.7 million injuries and illness cases were reported by employees in the US. With workplace accidents fairly common, it’s important to put in any preventative measures to stop these accidents from ever occurring.
However, when they do, the company may be liable and as a result, could in some cases, be expected to pay out. Some of those payouts can end up costing a small fortune, especially if the company lacks the right insurance. It’s worth contacting an accident lawyer if there are any claims made against the company.
Unsold products
For any business that sells physical goods, there’s a chance that some products will go unsold. Whether it’s the wrong approach or a lack of market for the physical goods in question, these unsold products can be a major loss for a business.
For smaller businesses that may be just starting out, a few occasions whereby products are unsold, it could be a financial problem that they struggle to come back from.
Legal action from clients or suppliers
Not every working relationship will work out and for some businesses that can even result in a disagreement or disgruntled clients/suppliers. In this case, it can often result in legal action, which is why it’s important to have legal aid available when it’s needed.
Often enough, it could be something that can resolve itself but on other occasions, it could be a problem that requires a more financial incentive or battle.
Building damage
No building is impenetrable and whether it’s damage caused by mother nature herself or by others, building damage is going to happen. For example, a freak storm might cause damage to the externals that cause leaks, and other times, it might be a break-in where goods are stolen and the property gets damaged as result.
Neither is enjoyable to experience but they’re both financial costs that can set back the business.
Payment delays from clients
There’s nothing more frustrating than payments not coming in on time. Payment delays cause business costs because when there’s not enough money in the bank, loans are required to cover the gap. This can cause extra fees and expenses that weren’t planned.
That’s why it’s important to have a healthier cash flow and invoicing/payment process to stop this from happening.
With these business costs, it can impact and hinder the business in more ways than one. While not all of them can be fully avoided, it can be useful to know what they are.