Should you offer Buy Now Pay Later?
When times are tight, it may be tempting to offer...
If the last few years have taught us anything, it's how important it is to thoroughly assess all potential risks that could affect businesses and consider how to implement risk reduction strategies to mitigate them. It's very unlikely that many businesses had "global pandemic" or a "trade war" on their risk management plans five years ago, but when we consider the enormous effect that the COVID-19 pandemic or the tariffs had on businesses worldwide, it's clear that lessons need to be learned in order to avoid such a situation from creating such incredible effects again.
Of course, there is absolutely nothing that any business can do to prevent a pandemic, a war in Ukraine or a trade war from occurring, but there are strategies for coping should it ever happen again. For example, many office-based businesses have embraced home working as an effective way of getting business done without needing staff to be in one centralized location.
Many food businesses have begun to take orders through their websites and have partnered with food delivery apps such as DoorDash and Uber Eats to ensure that even if they can't welcome customers onto their premises, they can still fulfill orders and keep loyal customers happy.
Another way in which many food businesses are learning from experience is by sourcing local ingredients as much as possible. Not only does this reduce a business' carbon footprint and please modern consumers, but it mitigates shortages in vital ingredients, such as the wheat shortage earlier this year resulting from the war in Ukraine.
Clearly, when considering risk management strategies, it is important to balance the likelihood of the event occurring against the cost of putting a mitigation plan in place, and there should always be a clear business benefit to implementing a plan immediately. If the risk is considered to be very unlikely to occur, it is sensible to still have an idea of what you would do to address it should the need arise, and even a vague idea of costs can be very helpful, even if you do not take it forward right away.
It is a good idea to discuss risk management strategies with your franchisor as they may already have a solid plan that can form the foundation of a strategy for your business, in addition to advising on mitigation strategies that the overarching business plans can implement so you can begin to determine which will work best for your particular location and clientele.
Being proactive about risk management doesn't mean throwing money at mitigating every single possible bad thing that could possibly happen to your business, but it can help you to target your efforts to ensure that any measures that you do implement will add value now and in the future.
