Business owners are at the forefront of ideas, thinking ahead always finding the sparkly new thing to market, but what happens when a wrench is thrown in to that mix?

…and how to prevent them before it’s too late

In the day-to-day hustle of running a business, it’s easy to overlook risks, while the business owners biggest worry is to find more business. Many Malaysian SMEs and growing companies don’t realise they’re vulnerable until operations are disrupted, revenue disappears, or key team members vanish overnight.

Here are six hidden risks most business owners only realise when it’s too late:

1. Bursting Pipes & Facility Damage: The Cost of Ignored Maintenance

Many businesses don’t think about pipes until one bursts. Whether you operate a cafe, clinic, warehouse, or office, a plumbing disaster can halt your business for days or weeks. Beyond repair costs, there’s water damage, important documents can be ruined, electrical plus points compromised, and lost revenue from not having your business open.

How to prevent it:

• Schedule regular inspections for plumbing, air-conditioning, and electrical systems.
• Invest in business insurance that includes damage from water, fire, and accidental disruptions.
• Ensure you have clear procedures for emergency shutdowns.

2. Employee Fraud: The Trust That Can Cost You Millions

All business owners will admit they trust most of their employees… most of them. However it is human nature to always take the easy way out, during times of stress, economic hardship, or loose oversight, even long-serving team members can make unethical decisions. From pocketing cash payments to setting up fake suppliers or quietly stealing data, internal fraud is a silent threat which can affect many businesses who are lax with their procedures.

How to prevent it:

• Conduct random internal audits.
• Enforce dual sign-offs for approvals, claims, and large transactions.
• Use insurance to cover employee dishonesty.
• Build a culture of accountability, not just trust.

3. Money Risk: Cash Flow Crises That Sneak Up on You

Many profitable businesses collapse because of one issue: cash flow. Sales might be high, but if customers delay payments, suppliers demand upfront deposits, or you expand too fast your business can run out of money overnight.Imagine feeling on top of the world with business, but looking at your bank account and realising its not sustainable to allow 90 day credit terms, and cash being delayed.

How to prevent it:

• Always keep 3–6 months of expenses in reserve.
• Use invoice factoring or short-term financing to close gaps.
• Monitor debtors closely and follow up before due dates.
• Have business interruption coverage in place for events that pause operations.

4. No Business Continuity Plan with Partners or Co-Founders

This is the biggest issue SMES have which they are not aware off, when a business partner dies, falls seriously ill, or disappears from decision-making what happens next?

Many SMEs have no written agreement or buy-sell plan. This leads to ownership conflicts, frozen bank accounts, or one partner being locked out of vital systems. Even partners spouses will be willfully unaware of the partners day to day work and share in the company.

How to prevent it:

• Draft a proper partnership/shareholder agreement with legal exit clauses.
• Invest in Key Person Insurance to cover loss of a critical partner.
• Ensure clear delegation of duties and access to shared platforms.
• Have a “Plan B” for operational control and communication.

5. Outdated Crisis Plans: When Everyone Panics and No One Leads

Some businesses have “emergency plans”… in a dusty file somewhere. But in real-time crisis whether it’s a fire, PR issue, or staff walkout most teams don’t know what to do or who’s in charge. The true sucess in business is that the owner can go on holiday for 3 months and the business be fine and running like a well oiled machine. This is rarely the case.

How to prevent it:

• Run crisis simulations once a year.
• Digitise your response plans—store them in the cloud.
• Assign clear roles: who contacts customers, vendors, insurers, media.
• Update plans regularly to match current risks.

6. No Insurance… or the Wrong One

Business owners often believe they’re “covered”until claims are rejected. Not reading the fine print, having lapsed premiums, or skipping essential add-ons like flood, theft, liability or keyman cover can cripple a company during disaster.

How to prevent it:

• Review your insurance portfolio every 6–12 months.
• Consult an insurance advisor, not just a sales rep.
• Bundle coverage to protect staff, equipment, assets, and income.
• Understand what’s not covered—and plan for those gaps.

Final Thoughts: Prepare Now, Thrive Later

Crises reveal leadership but also exposes negligence. If you’re growing your business, you can’t afford to be blindsided by preventable risks because sometimes the big lesson can wipe you out.

🛡️ A proactive checklist:
✅ Emergency & facility maintenance plan
✅ Employee fraud safeguards
✅ Reliable cash flow strategy
✅ Legal continuity with partners
✅ Updated crisis response plan
✅ Comprehensive business insurance

Want help auditing your business risks?
Reach out to Amana for a personalised Corporate Insurance and Risk Assessment Plan tailored for Malaysian SMEs and entrepreneurs. Don’t wait for the storm prepare before it hits!