What are Business Assets & How You Can Protect Them
When you start your own company it is vital that you have a strong understanding of business assets and what you can do to protect these assets. Every company has assets as these are any items of value which the business owns, creates or benefits from. A few examples of common business assets include cash, buildings, intellectual property, stock and office equipment.
You can also separate assets into different categories based on their convertibility into money. This includes:
Current assets – Assets with a shorter life span that can quickly be transferred into money. This includes assets like stock, inventory, bank drafts, receivables etc.
Fixed assets – Assets for long-term use and unlikely to convert into money quickly. This includes assets such as property, tools and machinery, furniture, long-term investments.
Assets can also be categorised by physical characteristics:
Tangible assets – Any material, financial and physical resource, such as cash, stock buildings, land, equipment etc.
Intangible assets – Any resource with no material substance but with clear business value. This includes assets such as intellectual property, trade secrets, licenses, reputation, brand and goodwill.
It is also important that you understand how you can protect all of your business assets to keep the operation running smoothly and successfully at all times. It is much easier to protect any tangible assets with physical security and insurance but intangible assets can be much more complex. It is always a smart idea to meet with a lawyer that is experienced in asset protection to identify the best way to protect all of your assets.
For intangible assets, a few of the best ways to protect the company is with patents, copyrights and trademarks that can provide legal protection to protect your property. You can also use confidentiality or nondisclosure agreements and employee agreements. Cybersecurity is also a major threat to your assets so it is vital that you have high-quality antivirus software and that you use a firewall but you must also educate yourself and your staff on how to stay safe online and the importance of backing up data.
Another intelligent way to protect your company assets is with unsecured business loans. An unsecured loan means that the business’s building or other valuable assets are not used as a means of protection in case you are unable to make repayments. Instead, it is likely that the lender will look at your trading history and/or ask for a personal guarantee.
Every business owner needs to understand exactly what assets they own and how these can be protected. Business assets come in all types and have varying amounts of importance but will all be key to the operation so knowing how to protect these will help you to run a successful operation and provide peace of mind.