As the number of microbusinesses in the UK continues to increase, evidence reveals that most of them are predominantly home-based, according to a report by SME Loans. Whether you’re starting a home-based beauty business, travel consulting, or web design venture, you stand to enjoy many benefits. These perks include reduced travel costs, low rent, tax breaks, and lower startup costs. However, to make the most of your home business, you need to protect it against potential risks that might interfere with its growth and success. Remember, like multinational companies, home-based businesses are also susceptible to risks that often lead to financial loss or even closure. To ensure you work from home successfully, below are steps to protect your home-based business from risks.
Choose The Right Business Structure
Running your business based on sole proprietorship might be straightforward, but it presents a set of challenges. Since you and your business are considered one, you risk losing personal assets like your home and car to pay off business debts. Because of this, consider choosing a business structure for your home-based company to separate it from personal assets. Depending on your preferences, you can choose to be a sole trader, private limited company, limited liability partnership, and public limited company.
Invest In Business Insurance
It’s impossible to eliminate every risk that may threaten your venture, but you can limit them by purchasing insurance. Some insurance policies home-based business owners need include general liability, professional liability policy, property insurance, and cyber insurance. Note that you’ll also need workers’ compensation for independent contractors to protect your business finances in the event of an accident. Contractor insurance protects your finances by covering medical costs should you get injured at work. In addition to paying emergency room care and partial wage loss during the recovery period, this insurance policy protects you from injury claim suits if subcontractors get into an accident while working.
Upgrade Your Home Security
While it might sound obvious, enhancing home security for your home-based business is crucial. Simple security measures like locking your doors and windows before leaving the house prevent burglars from stealing valuable business products. You may also want to install motion sensors, security cameras, and glass break detectors to keep intruders away. Additionally, protect business information saved in your computer by securing your home internet network, keeping data encrypted, and investing in the right malware software.
Establishing a home business guarantees numerous benefits, including cost savings, increased revenues, and enhanced productivity. However, you can only enjoy these perks if your business is safe from risks such as theft, accidents, data breaches, and lawsuits. The best ways to protect your business include buying insurance, choosing a suitable business legal entity, and updating your home security.
