4 Small Business Loss Prevention Tips

Most business owners focus on the day-to-day challenges of operating a business, such as sales and marketing. But a number of savvy business managers overlook a very important safety precaution: loss prevention. Whether your small business is a start-up or has been in existence for years, loss prevention is critical risk management strategy. Don’t let an already tight profit margin shrink further due to shoplifting, embezzlement, or fraud.

Follow these small business loss prevention tips so that you are armed with a adequate protection.

1. Data Protection. Recent data security breaches highlight the importance of protecting your customers and employee data from theft and misuse. A single data security breach can damage a company’s reputation and create long term repercussions. From server security to network level protection suites to laptop encryption technology, it’s critical that small businesses protect their intellectual property from both theft and unauthorized use.

2. Insurance. In a cash-strapped business, one thing that some small business owners may contemplate skimping on is insurance. However, that could be a huge mistake. Just one incident of a fire, natural disaster, or theft could lead to a business coming to a sudden halt. Insurance coverage should be tailored to the risks of the business, but should necessarily include such coverage as loss of equipment, business interruption, liability insurance for claims or lawsuit brought against your business, and more.

3. Employees. In the ideal world everyone would be honest, including employees. Unfortunately, that isn’t the case and many companies, large and small alike, have had their share of losses from employee theft. Even smaller items such as office supplies stolen can add up over the year. Keep office supplies under lock and key so employees don’t have free access to post-it notes, tape, and staplers.

4. Checks and Balances Policies. Another one of the most important small business loss prevention tips is to implement a system of checks and balances, especially when it comes to cash. For instance, assign two “different” people to counting and dispersing cash, rather than assigning one person to both duties. Add a third person to conduct an independent audit of cash and financial transactions.

All-in-all, just implementing a few small business loss prevention tips can save you hundreds or thousands of dollars later.