Running an asbestos surveying company is fraught with risks. And many of these risks can come unexpectedly, such as losing a key client or a sudden industry downturn.
Here are some ways you can protect your business against key risks:
- Reduce key-client dependency in case you unexpectedly lose a client
A general rule of thumb is that 80% of your revenue comes from 20% of your clients (the Pareto Principle) . So don't put all of your eggs in one basket by working with just one or two clients. It's also helpful to build a cash reserve just in case you lose a key client unexpectedly.
- Consider an "agency-style" model; a smaller fixed workforce, plus subcontractors
If you have lots of salaried employees, losing a big project or contract can cripple your business. Consider having a smaller "fixed" workforce and taking on subcontractors for larger projects. This "agency-style model" means you can scale your workforce up and down during busy or quiet periods.
- Expand into other asbestos services to avoid seasonal income dips
By offering more asbestos services you can "iron out" income dips due to seasonal fluctuations in one industry. For example, some companies offer asbestos training or removals during the quieter December and January period. Although only do this if you have the resources, you don't want to spread yourself too thin.
- Reduce over-dependence on one industry. Move into other compliance industries
Every industry experiences downturns or quiet periods. Spread your risk by moving into other industries, so you're not at the mercy of market factors beyond your control. Over 60% of asbestos service companies have diversified into non-asbestos services like Lead Paint, Legionella, or Fire Safety Inspections