Biggest risks your small business faces in the new year

By Michelle van Schouwen

As 2020 approaches, you may be excited about new opportunities and trends for your business. While you’re planning for these, also take time to appraise the downside – the serious risks your small business may face in the coming year.

Many small businesses operate somewhat day-to-day. Time, personnel and financial resources are often stretched tight. These conditions, while hardly extraordinary, increase certain risks:

Assuming conditions won’t change: Both slow and sudden change can cause problems for your company, and not being prepared for reversals can be catastrophic. To become more aware of potential negative changes ahead, conduct a business pre-mortem. Using this technique, you will assume a premise that it’s a year from today and your business has failed or suffered a serious setback. You then brainstorm all the possible reasons this may have happened. Once you’ve come up with all the most likely scenarios, take immediate steps to protect the company.

Trusting precious clients: It’s almost certain that your biggest clients need you less than you need them, and that’s a dangerous situation to be in. Take steps both to maintain the business you have with these and other clients and to balance out your customer base so that one or two big clients don’t have the power to determine your fate. The founder of this blog, Jeanne Yocum, has written a book called The Self-Employment Survival Guide it addresses these topics in its chapters “Having Too Many Eggs in One Client Basket” and “Sudden, Unexpected Client Defections.”

Trusting vendors and employees too much: Do not make the mistake of becoming too dependent on any particular vendor or employee. Do not become convinced that the people who earn money from you are also your friends. Do not assume they care about your company as much as you do. Know your options and be prepared to exercise them in case a vendor or employee needs to be replaced or terminated. As a former employee advised me, “If you want loyalty, get a dog.”

Having insecure or poorly backed up data, including your website: If you are not waking up at 3 a.m. imagining the worst (your website has been hacked and you don’t have a current back-up of the content or your customer or financial data has been compromised…) maybe you should be. Take all the steps you need to assure that your digital assets are secure and backed up, preferably offsite. Hire an expert to help if you need support.

Not having actionable plans for natural disaster, owner or family illness and other unforeseen events: Succeeding in Small Business blogger Mark Auerbach has recently shared his experience keeping his business going after a serious injury. I’ve written about preparing for natural disaster and the worst-case scenario of suddenly losing your business partner. Small companies, dependent on all their resources every day, are especially vulnerable to disasters such as these, so please consider them in your planning.

Preparation to avert risks and prepare for potential unfortunate events is akin to the cliché of taking an umbrella with you on a gray, dry day. You will be happy if the rain doesn’t come, and wonder why you carried the umbrella at all. But when you do get caught in a downpour, you’ll be very glad to open that umbrella and take what shelter you can. Your small business deserves that shelter, too.


Michelle van Schouwen enjoys an “Act 2” career as principal of Q5 Analytics, providing advocacy and communications for climate change mitigation and adaptation. See For 32 years, Michelle was president of van Schouwen Associates, LLC (vSA), a B2B marketing company. In 2017, van Schouwen Associates was acquired by Six-Point Creative Works, Inc. of Springfield, MA. Michelle is available for speaking engagements on topics including her new work on climate change mitigation and Florida coastal water issues. She speaks to business and student groups about marketing launches and entrepreneurship and works with start-ups to support their development.


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