On November 17, 1993, Herman Mashaba’s ‘Black Like Me’ factory in Mabopane was burned to the ground by arsonists. It seemed that in a matter of an hour the heart had been ripped out of a company that at the time employed 120 people and was South Africa’s leading supplier of beauty products for the black community. All the manufacturing equipment and most of the stock had been destroyed.
What would you have done, especially at a stage of #STARTing your business? Most businesses under the same circumstances would have gone down and never operate again. Fortunately for “Black Like Me” the fire would only slow the company’s advancement slightly. Despite the setback it would maintain its turnover of the year before.
Most entrepreneurs who are starting a business never prepare themselves for rainy days that are in some instances unavoidable. The story of Herman Mashaba’s company should serve as a reminder and warning for people who are starting a business that they need to protect themselves business risks.
The are couple of ways that entrepreneurs can protect their businesses against disasters and one such is through business insurance. In the same way a person can protect themselves against unforeseen circumstances businesses also need to do the same.
Starters of businesses especially during early stages of the business need to protect their businesses against:
- Employers Liability
- Office Contents
- Public Liability
Employers Liability – by law employers are liable for negligence and omissions by their employees in the course of employment. Business owners therefore need to protect themselves against potential negligence by employees.
Office Contents – Due to crime,disasters and other causes of damage to office contents business owners need to protect office content if such an occurence were to occur.
Equipment – office equipment can also be damaged in one way of or another an when this occur it can negatively impact the business. To avoid interruptions to the operations of the business business owners need to protect the business against potential damage to office equipment.
Vehicles – Company vehicles are one of the major assets exposed to risks such as theft,accidents and damage. For businesses relying on such assets any form of interruption that affects the vehicle can bring the business to a stand still.
Fire – As seen in the case of Black Like Me fire can bring an end to a business that is just starting or established. Businesses can do so much to prevent fire however when the businesses is affected by fire the goal should be to ensure that the business can get back on track within a short period of time. Once again a form of protection through a business insurance can assist a business in preventing complete downfall.
Public Liability – is part of the law of which focuses on civil wrongs. An applicant (the injured party) usually sues the respondent (the owner or occupier) under common law based on negligence and/or damages. Claims are usually successful when it can be shown that the owner/occupier was responsible for an injury, therefore they breached their duty of care. When this form risk occurs a business needs to ensure that it is well covered as public liability can be costly.
These are just some of the risks that can be dealt with through a business insurance. Other forms of risks such copyright issues can be dealt in a different way. The next START Blog post will focus on what an entrepreneur can do in relation to risks related to copyright.
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