Some of the responses from FreshBooks survey of self-employed professionals surprised me.
Although the data set was American small businesses, it’s not unreasonable to assume a lot of the challenges they face are shared with UK companies.
48% Are Unprepared Should Their Business Get Sued
Almost half of small businesses don’t have insurance in place, yet in the UK insurance costs as little as £14 per month. £14 per month for access to a team of legal experts.
At this cost no business—especially a sole trader—should be scrimping on insurance.
Cost aside, there’s a misunderstanding that could be the reason businesses don’t have insurance. Many think professional indemnity is about litigation—that it only comes into action when they’re sued. This isn’t always the case.
Whilst commercial litigation is covered under the policy, your policy can serve a purpose before it reaches that stage. One example is when there’s a breakdown in a client relationship.
We’ve seen this happen. Things start off great, but as the project goes on there’s a gradual breakdown and the client refuses to pay the fee.
This is just one instance the insurer can be advantageous in a situation that doesn’t involve legal proceedings, putting you back in the same financial position you were in prior to the loss.
52% Think Big Banks Aren’t Designed To Serve The Needs Of Small Business
Just like With Jack for insurance, there are banks designed with small businesses in mind.
Coconut is geared towards freelancers and helps you work out your taxes, track your expenses and get you paid on time.
Tide offers small businesses a more efficient and helpful way to manage money.
Who needs a big bank?
28% Say Managing Business Keeps Them Up At Night
We’re creatives. We don’t want to invest too much energy into thinking about accounts, insurance and other stuff. We want to make things, keep our clients happy and get on with the day-to-day of our business. Right?
This is why it’s worth investing in tools to help you. Here are some of my recommendations:
- Cushion for cash flow (With Jack customers get their first month free)
- With Jack for insurance
- Tide or Coconut for banking
- FreeAgent for accounts
- Workshop for high-value freelance opportunities
- Bonsai for contracts
You can see the rest of the FreshBooks survey on their blog, but don’t be a statistic! Treat your small business like a business. That means contracts, accounts and insurance. Fortunately there are tools—like With Jack—that make this easier for you.