Edmonton Spring Summer 2021

THREE WAYS YOU’RE RISKING YOUR BUSINESS IN 2021
It’s been many months of lockdowns and
restrictions, and the strain is showing everywhere.
And unless your business operates on one of the
rare models that benefit from a pandemic, you are
probably growing a little weary of hanging on.
With more virulent COVID-19 strains slipping into
our communities while vaccine delivery hits new
barriers and case numbers continue to rise, most
of us are looking forward with a fluctuating mix of
optimism and concern. It is becoming clear,
despite what anyone wants, that the real recovery
is many months away.
That means as entrepreneurs and business
leaders, we are still miles away from predictable
times. And what’s worse is that many are
operating in ways that drive up, rather than
minimize, their future risk.
Here are three risk factors I’m seeing daily, and
actions to turn each one around.
Sticking Your Head in the Sand. The single
biggest contributor to bad debt writeoffs is
procrastination. Even during good times, by the
time an account is flagged as a true problem, it
can often be beyond recovery. During a financial
crisis like this, 60 is the new 90. Tighten, rather
than loosen your standard timeframes to be
ahead of the pack when an account is struggling
to pay. It’s important to perceive recovering debt
as a race against other creditors, where anyone
but the winners will miss out big-time. Clients
who send us overdue accounts promptly are
seeing dramatically faster results and a high rate
of of success than those who wait. Get your head
out of the sand and back into the game!
The Sunk-Cost Mentality. Experts in behavioural
economics remind us that humans have a
foolhardy but hardwired inclination to languish
on prior efforts and expenses, despite that we
would be far wiser to invest our energy in creating
future successes than on trying to extract value
from the past. When you send an account to your
collection agency, you can achieve the best of
both worlds—maximizing your Net Back while
returning your mental focus to the skills and
expertise that create future value.
Failure to Evolve. Many businesses that are