- Develop a comprehensive asset protection plan to identify and secure all business assets from misuse or theft.
- Obtain insurance, create separate legal entities, and seek legal assistance for contracts to protect assets.
- Secure intellectual property by applying for trademarks, patents, and copyrights and incorporating encryption for financial records.
- Develop an estate plan to ensure the transfer of ownership in the event of death or incapacitation.
As a business owner, you have worked hard to build your business and protect its assets. From the products or services you offer to the people you employ, you have built something that serves a purpose and brings value to your customers. But how do you ensure that this doesn’t disappear in a single day?
When to Start Protecting Business Assets
It’s important to start protecting your business assets from the very beginning. When you decide to open a business, consider how to protect it. You don’t have to be nearing retirement to start protecting your assets. As soon as you have something to protect, start taking steps.
Once you’ve decided to protect your business, you can do this in many ways. Here are some of the most common methods:
Create an Asset Protection Plan
Developing an asset protection plan is the first step in ensuring your business’s assets are safe and secure. This plan should include a comprehensive list of your assets, from physical items like buildings to intangible things such as customer lists and intellectual property. Once you have identified all of your assets, you can implement protection measures to ensure they are not misused or stolen. You can employ the help of the following:
Insurance
Insurance, particularly business insurance, is a great way to protect your assets from unforeseen circumstances. Depending on the type of coverage you obtain, it can help cover any losses incurred due to theft, fire, flood, or accidents.
Create LLCs and Corporations
Creating separate legal entities for your business’s assets (i.e., limited liability companies and corporations) can help protect them from personal liability. By legally separating your assets, you create a “corporate veil” that shields them from creditors and legal action.
Legal Safeguards
A lawyer can help you draft contracts and draw up documents to protect your assets from legal action. Hiring an estate planning lawyer can also help you devise a plan to transfer ownership of your business in the event of death or incapacitation. This way, no matter how new or established your business is, you can be transferred to the next of kin without legal complications.
Secure Your Intellectual Property
Your intellectual property is one of the most valuable assets of your business. It can include everything from copyrightable content and designs to patents, trademarks, and trade secrets. Securing these items properly with the correct documents and registrations is important to ensure they remain yours. Here are ways to do this:
Trademark Protection
Trademarks are a type of intellectual property that protects the brand identity of your business. Registering your trademarks can help prevent others from using them and ensures the uniqueness of your products or services.
Copyright Protection
Copyright is another form of intellectual property that can be used to protect original works like music, literature, art, software, and more. If your business has created any of these products, copyright them for protection.
Patent Protection
If you have invented a product or process, securing a patent is the best way to protect it from being replicated by others. A patent will give you exclusive rights and control over that invention for a period.
Protect Your Business Finances
The financial stability of your business is essential for its continued success. You must ensure that all financial accounts are secure by implementing proper access controls and authorization requirements for online banking activities. Additionally, ensure all financial records are kept safe and secure. For your physical documents, here are ways to ensure the safety of your money:
Use Two-Factor Authentication
Two-factor authentication is an effective security measure for protecting your financial accounts. It requires two credentials, usually a password and a form of two-step verification (like a PIN or OTP code), to access an account. This way, even if someone manages to get their hands on the password, they won’t be able to access the account without the second set of credentials.
Use Encryption
Encrypting financial records is an important step in protecting your business finances. Encryption makes it difficult for hackers to access sensitive information, even if they manage to get their hands on the data. It transforms the data into a code that can only be deciphered with the correct key.
A plan to protect your business assets is essential for any business. Taking these steps ensures that your hard work and dedication are always secure and protected. Remember, it’s better to be safe than sorry.
