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The disconnect that exists between consumer payment preferences and what small businesses offer is both surprising and consequential. According to recent data from Xero, nearly 90% of U.S. consumers prefer to pay by credit card, yet 30% of small businesses still do not accept card payments.

As competition heightens and customer loyalty becomes increasingly elusive, it’s more crucial than ever for small businesses to make decisions that align with their customer’s wants and needs. Adapting to consumer preferences not only fosters loyalty but also drives future growth. In order to do so effectively, small businesses must embrace the shift towards modern payment solutions to meet consumer expectations head-on.

How to develop a better understanding of shifting consumer preferences

Over the past decade, we’ve witnessed a significant shift in consumer behavior, largely driven by technological advancements and changing lifestyles. This has led to consumers having a diverse set of preferences for payment options; as such, businesses who offer multiple methods – such as debit and credit cards, mobile payments and Buy Now, Pay Later (BNPL) options – reach a wider range of customers and improve loyalty and satisfaction.

When consumers encounter barriers when shopping, such as the unavailability of their preferred payment methods, it’s more likely that they become frustrated and consider switching to a competitor. With so many other alternatives available, it’s even more imperative for businesses to offer a variety of payment options to cater to a wider range of customer needs — especially knowing just how valuable customer retention is in today’s landscape.

As an example, mobile payments have surged in popularity, particularly with younger generations: approximately 43% of Gen Z customers and 42% of Millennials regularly use digital wallets like Apple Pay or Google Pay, reflecting a preference toward convenience and ease in transactions. This trend underscores the need for businesses to adapt and embrace digital solutions in order to connect and engage with younger generations of consumers.

Research indicates that 21% of consumers would consider shopping at another business that accepts more payment options if their preferred payment method wasn’t available, highlighting a potential – and avoidable – loss for small business owners. As we’ve seen a growing trend towards digital and contactless payments, businesses that fail to adapt risk losing out to competitors who offer a more accommodating checkout experience.

From a business standpoint, digital payment systems also play a pivotal role in accelerating cash flow for small businesses. Recent data from Xero reveals that, on average, small businesses were paid 9.5 days late in the June quarter (2024). By incorporating “pay now” features on invoices and sending timely reminders to customers, digital payment systems can significantly reduce these delays and ensure that businesses receive their payments more promptly.

Incorporating diverse payment options can also create a more inclusive shopping experience, allowing customers with different financial situations to shop at your business. For example, BNPL options can attract younger customers who may not have the funds immediately but want to make a larger purchase. It’s also vital to adapt payment options based on differing customer touchpoints and interaction types. While customers interacting online often prefer digital payment methods, in-store shoppers may have different expectations and preferences. In fact, research shows that 74% of shoppers still use cash to make payments, highlighting the need for businesses to also cater to this subset of customers.

By offering both traditional and digital payment options, businesses can accommodate those who prefer cash and those who seek the speed and convenience of mobile wallets or contactless payments. This approach makes the shopping experience more seamless for every type of customer, whether they are tech-savvy or prefer more old-school methods.

What strategies can small businesses deploy to implement these changes?

As a small business owner, optimizing your payment system may seem like a daunting task, when in reality, it has the potential to be an exciting opportunity to elevate your business. By taking a strategic approach, you can ensure your payment methods align well with both your operational needs and customers’ preferences. Here are some practical steps to get started:

Assess current payment options

The first step is to evaluate what payment methods are currently in place. Ask yourself: What payment options are currently available for customers? Are customers satisfied with these, or are they requesting alternative methods such as contactless payments or BNPL services? Are there any common issues or complaints related to our current payment processes?

When evaluating these aspects, consider whether your existing options meet your business’s unique demands – such as payment speed, ease of integration and overall enhancements to the customer experience. By thoroughly assessing these areas, you’ll be able to reveal any gaps in service or opportunities for expansion. If you’re hesitant about adopting new payment technologies, keep in mind that these solutions have been designed with small businesses in mind and are built to seamlessly integrate with your existing systems.

Research and select suitable payment methods

Once you’ve assessed your current options, the next step is to explore different payment technologies that would fit your business operations. While traditional methods like debit and credit cards are widely accepted, it’s time to think beyond just the conventional offerings. Consider newer options such as mobile payments (e.g., Google Pay and Apple Pay) and BNPL services (e.g., Klarna and Afterpay), which have gained popularity in recent years due to their convenience and flexibility.

When conducting research into areas for expansion, consider which would best align with your business goals. Do you prioritize quick payments or minimal transaction fees? Take the time to explore your company’s data and analyze your target market’s preferences — understanding the spending habits of your customers can provide key insights. Keeping your customers’ needs at the forefront of your decision-making process, while also considering what’s feasible and best for your operations, will ensure a smoother transition and better outcomes.

Balancing costs and benefits of modern payment technologies

While adopting new payment technologies has many benefits, such as boosting customer satisfaction and enhancing cash flow, it’s equally important to consider the associated costs. Transaction fees, surcharges and implementation expenses should factor into your decision-making process, but don’t let these costs deter you off the bat; instead, weigh them against the clear benefits.

Instead of viewing upgrades as mere costs, consider how each new transaction through an upgraded payment option can actually drive your revenue. Each new transaction shouldn’t just be viewed as a sale, as it’s opening the door for increased growth and customer loyalty. If you miss out on transactions because your payment methods don’t meet your customer’s needs, it can impact your bottom line over time. Look at investing in new payment technologies not just as an expense but as an opportunity to capture more sales and grow your business.

An interesting example of a retailer is Walmart, which, despite not accepting Apple Pay, strategically promotes its own payment solution, Walmart Pay, to maintain control over data and enhance customer engagement. However, it would be interesting to see whether this strategy is worth the potential loss of customers who might not be willing to take the extra step to download and use Walmart Pay.

Investing in modern payment technology does more than just streamline transactions, it can enhance security, expedite payments and improve the overall customer experience. By streamlining payment processes, you free up valuable time and resources, allowing you to focus on other strategic areas of your business. A secure payment system not only can protect your business from fraud but can also build more trust with your customers.

Adapting to shifting consumer preferences is vital for small businesses looking to enhance customer experience through improved payment options. Customers don’t just want — they expect — seamless, flexible and secure payment options, and meeting these expectations is a key way to build trust and loyalty and set your business apart from competitors.

AI is an expensive business, costing upwards of $100 million simply to train a new model.

At Microsoft, though, a multi-billion dollar investment in AI appears to be paying off: CEO Satya Nadella said on a quarterly earnings call on Wednesday that Microsoft’s AI business “is on track to surpass an annual revenue run rate of $10 billion next quarter” and become “the fastest business in our history to reach this milestone.”

The annual revenue run rate projects revenue over a period of time based on previous revenue.

Related: Will It Take Nuclear Power to Sustain AI? Microsoft Is Betting on It.

Microsoft has invested about $14 billion into OpenAI, the company behind ChatGPT. It has also made several multi-billion dollar AI commitments, including a deal to reopen Three Mile Island, a nuclear power plant near Harrisburg, Pennsylvania.

^{Microsoft CEO Satya Nadella. Photo by Ethan Miller/Getty Images}

Nadella also pointed out on the call, which went over earnings for the first quarter of fiscal year 2025, that Microsoft Cloud revenue was up 22% year over year, growing to $38.9 billion for the quarter ending September 30. Revenue overall increased 16% to $65.6 billion.

At Microsoft, “AI-driven transformation is changing work, work artifacts, and workflow across every role, function, and business process,” Nadella said.

Though Microsoft’s earnings were better than expected, the company’s shares fell by more than 5% on Thursday because its predicted cloud revenue growth was less than expected.

Related: These CEOs Have the Biggest Pay Packages in the U.S., According to a New Report

Nadella was well-compensated for leading Microsoft: He received a pay increase of over $30 million for the fiscal year ending June 30, resulting in an overall pay of $79.1 million compared to $48.5 million a year prior.

Nadella’s compensation would have been $5.5 million higher, but he asked for it to be lower following a series of cybersecurity breaches.

Meanwhile, Microsoft went through layoffs affecting nearly 1,900 people in its gaming division in January.

Microsoft now has about 228,000 employees globally.

Related: Microsoft Strikes Back at Salesforce, Announces New AI Agents That Can Take Over Finance, Sales, and Service Tasks

As the 2024 election season comes to a close, we’re encountering a year of historic firsts — nationally and locally. If Vice President Kamala Harris and Governor Tim Walz were to win the White House this year, the highest-ranking Native American woman in the country would become the governor of Minnesota. That woman is Peggy Flanagan.

Lauded as one of Minnesota’s rising stars and currently the highest-ranking Native woman elected to executive office, Peggy Flanagan is a politician, community organizer and Indigenous activist from the White Earth Nation. She has been serving as the lieutenant governor of Minnesota since 2019 and is currently next in line to assume the governorship if Tim Walz becomes vice president.

So what does this all mean? History could be made this November and help catapult the first Native woman — and consequently, long-overlooked Native issues — into broader American public discourse. It’s perfect timing, too, as we approach Native American History Month this November.

Even though we’re zooming in on politics in this piece, entrepreneurs across the spectrum can learn something about positioning diverse leaders in the right spaces and supporting their work and advancement throughout their tenure.

Flanagan needed allies like Walz and others to lift her voice and put her into positions where she could make an impact. We can all learn more about what it means to be a better ally for those who are the “firsts” in their space. Here are three strategies around allyship I recommend to my diversity, equity and inclusion (DEI) consultancy clients.

Related: The Burden of Breaking Barriers is Pushing Black Leaders to Breaking Point. This DEI Expert Reveals Where We Are Going Wrong.

Let diverse leaders lead

There have been many firsts in the realm of politics in recent years. There was the first Black president, Barack Obama, in 2008, then the first openly gay governor, Jared Polis, from Colorado in 2019, and potentially, the first woman and Southeast Asian president, Kamala Harris, in 2024.

All these great firsts had this in common: they had allies and partners that let them take the lead and shine. Peggy Flanagan has been an outstanding leader in the realm of DEI for decades. In 2017, she helped form Minnesota’s first People of Color and Indigenous Caucus (POCI). She worked tirelessly to improve education, health and economic outcomes for Black, Indigenous and People of Color (BIPOC) in her state.

In addition, she has been a fearless advocate of Indigenous people’s rights. While serving as a legislator, she sponsored a first-of-its-kind task force focused on Missing Murdered Indigenous Women (MMIW), a phenomenon happening across the country where Indigenous women experience violence and go missing shortly thereafter. Local police municipalities in many states often don’t search for missing Indigenous women or investigate their disappearances. Unfortunately, MMIW cases usually go unsolved. All that is to say that when we let diverse leaders lead, they can do powerful things by raising awareness about issues that may have never crossed our minds. As allies, our job is to lift these leaders up and amplify their work.

Beware of performative allyship

While many people want to take credit for knowing the trailblazers in politics and DEI and take pride in having supported them on their way up, the truth is that it can be a lonely journey for many leaders who had to actualize their dreams on their own. They sponsored their legislation and wrote it themselves with their teams. They sat in rooms with decision-makers where they worked hard to get colleagues on board with their bold new initiatives. They attended many thankless events where they carried the burden of organizing, leading and managing the outcomes alone.

Many people want to take credit for the work BIPOC has been doing by saying they were “there” at the event or “support” so-and-so leaders’ work wholeheartedly. But still, BIPOC individuals are often the people who did all the work, and still, the allies are nowhere to be found. Performative allyship can often look like claiming to be an ally when it’s politically or socially advantageous but not during times when true grit, work, and dedication are required — and the cameras and spotlights are off. Avoid falling into the trap of lifting up leaders like Flanagan when it’s most convenient for you and not for the leaders and their causes.

Related: How Brands Can Go From Performative Allyship to Actual Allies

Be a success partner

What’s most helpful for rising leaders whom you wish to support is not only to say you stand behind certain causes but to actually show up and prove it. Support bills that improve Indigenous health, education and rights. Speak about Flanagan’s work in the public domain, thereby ensuring colleagues who might be interested in those issues are aware of them. Donate to organizations and nonprofits that bolster the work that Indigenous leaders are doing to move the needle on change. It’s not enough to say, “I’m for Indigenous people’s rights,” or to do a land acknowledgment when you haven’t actually done the work, spent the time, or put your money where your mouth is.

Related: It’s Not Enough to Simply Acknowledge Indigenous People’s Day. Here Are 4 Ways Employers Can Take Action, Help and Support Native Americans.

Final thoughts

No matter what happens this November, leaders like Peggy Flanagan are on the rise. When one person moves on to a higher office, BIPOC and LGBTQ+ officials who have been waiting for their moment to shine can finally rise, too. The future is bright for a new generation of leadership in the U.S. that better represents the diversity of the country while inspiring more just, equitable and inclusive policies at local and national levels.

When I decided to build a business from scratch, I knew it would demand not just the introduction of technology but also an iron will to address the persistent inefficiencies within the sector. The outdated and fragmented practices in the pharmacy industry were a source of my frustration, as they introduced unnecessary inefficiencies to both pharmacists and patients. I was driven by the belief that there had to be a more efficient way forward.

Throughout our journey, we recognized that welcoming change and refining our approach was essential for our growth and its overall impact on the pharmacy landscape. Three steps significantly influenced this— steps that every company can adopt to pivot effectively and identify new avenues for revenue and impact.

Here’s what we did.

1. Fail fast, pivot faster

Do not fall into the trap of thinking your go-to-market plan is flawless. The biggest advantage of being a startup is agility. You must use that agility to your advantage and recognize when your plan needs adjusting. Further, as a start-up, your runway is limited, so ensure you are making team decisions quickly.

After launching our initial B2C business in 2017, we encountered gross margin challenges that eventually forced us to reassess our go-to-market strategy. In 2019, we took a step back as a team and analyzed the pharmacy industry’s Total Addressable Market (TAM) and the broader B2B landscape. We ultimately realized two key paths moving forward.

First, a significant portion of the pharmacy industry’s market share was attributed to specialty pharmacy. Within the specialty pharmacy landscape, pharmaceutical manufacturers need digital infrastructure to help navigate the challenging patient journey. Second, health plans are hyper-focused on clinical metrics called quality measures but lack the scalable digital infrastructure needed to cleanse data and automate clinical processes at scale. These realizations became the foundation for our transition into B2B.

Related: How to Recover From a Failed Startup

2. Brutally honest conversations

I have always believed that transparency is the best path forward, which means keeping both your internal team and investors fully informed. As a team, we plotted all the possible paths forward, including possibly shutting the company down. It is okay if your initial thesis does not pan out, but it’s not okay to continue trying to make it work when metrics tell you otherwise.

Being prepared to have uncomfortable conversations is among the toughest elements of pivoting. Early on, it was obvious we had to change course, but it was not an easy decision. We were lucky enough to have a team that was not afraid to voice differing standpoints. Our collective input helped us shoot down some pivot paths that, in hindsight, would have led us in the wrong direction.

If your go-to-market strategy is not working, acknowledge it quickly and transparently. Don’t hide from the data or the feedback from your team and investors. Laying all your cards on the table helps ensure everyone is aligned on potential next steps while maximizing opportunities to ideate. This energized our team and investors, allowing us to rally behind the new path with focus.

Related: How Brutal Honesty Saved My Business From Going Under (Twice)

3. Listen to your clients

One of the golden rules in business is taking on real client problems. The emphasis of changing your approach should be on spotting the pain points of your consumer base and presenting your business as the best one to solve them.

Through our journey, we noticed growing needs for digital infrastructure across the various verticals we operated. By listening to our clients, we learned about some of their most glaring challenges, which helped us steer our roadmap. On that note, it is important to remember that while listening to your clients is essential, you should be cautious about allowing a single client to dictate your entire product roadmap. Continuously validate that their needs are universal in the industry. The key is finding a repeatable solution that can scale across multiple clients.

Related: How to Handle Difficult Conversations With Clients

The impact of these steps

Looking back, these three difficult but necessary steps completely transformed our business. 2019 saw us go from a B2C digital pharmacy to a thriving B2B digital pharmacy platform. Our success came mostly from our capacity to pivot at the right moment and show total transparency to all stakeholders. Throughout our journey, we also preached the value of frugality, giving us the longest possible runway to navigate our early challenges. We took action early while we still had an opportunity to flourish; we did not wait for things to reach rock bottom before making a change.

Embrace change with confidence, but do so with careful consideration. Ensure that reliable data, deeper insights, and a well-defined vision for your business’s future drive the changes you pursue. It’s not just about adapting for the sake of it — it’s about making intentional, informed decisions that will lead to sustainable growth and success. Be strategic, thoughtful, and deliberate in your approach, aligning each change with your broader goals and values to create a positive and lasting impact.

Google software engineers have a new coworker: AI.

Google released its third quarter 2024 earnings on Tuesday and emphasized the role that AI plays within the company.

“Today, more than a quarter of all new code at Google is generated by AI, then reviewed and accepted by engineers,” Google CEO Sundar Pichai stated on the earnings call. “This helps our engineers do more and move faster.”

Google has over 1,000 fewer employees now than it did at the same time last year, for a current headcount of 181,269 employees compared to 182,381 in Q3 2023.

^{Google CEO Sundar Pichai. Photo by Mateusz Wlodarczyk/NurPhoto via Getty Images}

Google’s AI impact extends to all corners of the globe. Pichai stated that AI overviews in search will roll out to more than a hundred new countries this week and will “now reach more than one billion users on a monthly basis.”

Related: New Google Report Reveals the Hidden Cost of AI

Google Search revenue grew 12% year-over-year, hitting $49.39 billion in the third quarter of this year. Total revenue reached $88.27 billion, a 15% increase from the previous year’s $76.69 billion.

“Search remained the largest contributor to revenue growth, followed by robust 35% growth in Cloud,” Google’s chief financial officer Anat Ashkenazi said on the earnings call. Google Cloud revenue was $11.35 billion in Q3 2024.

Google also announced on the call that YouTube’s ad and subscription revenue for the past four quarters have topped $50 billion for the first time.

Overall, “Q3 was another great quarter,” Pichai stated. Shares of Google’s parent company Alphabet were up over 5% today at the time of writing.

Related: I Tried Making an AI-Hosted Podcast with Google’s NotebookLM. It Worked Surprisingly Well.

Daniel Lubetzky, the founder of Kind Snacks with a personal net worth of $2.3 billion, admits that his morning routine used to be exhausting.

“I used to have horrible habits,” he said in an interview with Entrepreneur.

Lubetzky founded Kind Snacks in 2004 and sold it for $5 billion in 2020; he is now the founder and chairman of Camino Partners, a $350 million fund he started in January 2023, and a regular cast member on ABC’s “Shark Tank.”

Lubetzky shared that he spent years going to sleep at 2 a.m. because he wanted to clear his inbox completely. Instead of going to sleep, he would spend hours checking and responding to emails. The next morning, he wouldn’t make his scheduled workout because he needed the extra half hour of sleep.

^{Daniel Lubetzky. Photo Credit: Christopher Willard/ABC via Getty Images}

“I had terrible exercise habits and sleeping habits,” Lubetzky said.

In the past two months, the 56-year-old entrepreneur has deliberately made some changes to his bedtime and morning routine.

“I conquered that,” he said. “I’m not going to sleep and waking up at the same time. It’s just transformed my life.”

Lubetzky now falls asleep around midnight and wakes up by 7:30 a.m. or 8 a.m., setting a new habit. His morning routine consists of stretching, something he says gives him “so much enjoyment.”

Related: Daniel Lubetzky Took Kind Snacks From Idea to $5 Billion. Here’s His Best Advice For Anyone Who Wants to Start a Business.

Productivity hack

Lubetzky also shared his top tip for productivity: When you’re working on a task, finish it.

“Don’t just leave things halfway, because then you have to start from scratch,” he said. “You’re being very unproductive.”

He recommended thinking about attention as a dot. Every time you read an email, that’s one dot virtually placed on the email. The goal is to minimize the number of dots, or points of attention, commanded by an email or document so that you’re not revisiting the same issue over and over again.

Book recommendation

Lubetzky recommended reading “The Daily Stoic” by Ryan Holiday, a book of 366 meditations. The book focuses on insights from Stoicism, a philosophical system that encourages focus on what can be controlled and acceptance of what can’t.

Related: Here’s What It Takes to Land an Investment From the Founder of Kind Snacks, Who Sold His Company for $5 Billion

Dropbox announced it is laying off 528 people, or 20% of its workforce, CEO Drew Houston wrote in a staff memo published on the company website Wednesday.

“As CEO, I take full responsibility for this decision and the circumstances that led to it, and I’m truly sorry to those impacted by this change,” Houston wrote, adding that the company “over-invested,” and will now be “flatter” and “more efficient.”

Related: ‘I’m Still Trying to Process’: Meta Is Laying Off Employees Across the Company, Including WhatsApp, Instagram, and Threads

TechCrunch reports that Dropbox had the lowest growth in its history in Q2, and in August, its shares year to date lost over 20% of its value.

“This market is moving fast, and investors are pouring hundreds of millions of dollars into this space,” Houston wrote. “This both validates the opportunity we’ve been pursuing and underscores the need for even more urgency, even more aggressive investment, and decisive action.”

More details on the layoffs and “high-level changes” will be made public soon, and there will be company-wide “Town Halls later this week to answer questions and discuss our plans in more detail,” the memo continued.

Related: Apple Just Conducted a Rare Round of Layoffs. Here Are the Teams and Roles Affected.

Read the full memo, here.

In a move that we can assume was accompanied by a two-finger salute, Oasis canceled thousands of tickets sold on resale websites, according to BBC.

Live Nation and SJM told BBC File on 4 that more than 50,000 tickets that have been listed on secondary platforms for the band’s UK dates will be invalidated and relisted on Ticketmaster at the original face value.

When the tickets first went on sale, Oasis announced they could only be resold at face value through Ticketmaster or the ticket resale marketplace Twickets. But NBC News reports that soon after going on sale, some tickets were quickly relisted for as much as $7,800.

Related: Why Does Taylor Swift Keep Stopping Her Shows Mid-Song? It’s Actually a Great Lesson in Leadership.

A spokesperson explained: “These terms and conditions were successfully put in place to take action against secondary ticketing companies reselling tickets for huge profit,” adding that, “All parties involved with the tour continue to urge fans not to purchase tickets from unauthorized websites as some of these may be fraudulent and others subject to cancellation.”

If you are a ticket holder and believe your tickets were canceled in error, the organizers say to contact your ticket agent to open an investigation.

The tour is set to start in the U.K. and Ireland in July of 2025, and then will come to North America in late August. Something tells us this will not be the only drama this tour faces between now and then.

Oasis frontmen and battling brothers Noel and Liam Gallagher have not performed together in 15 years.

How prepared is your business for the risks it doesn’t see coming? In a world where cyberattacks, regulatory fines and reputation-damaging incidents lurk around every corner, businesses are increasingly faced with a choice: react to crises or prevent them. The smarter choice, of course, is prevention. But how many businesses are actually doing it?

The truth is, too many organizations are reactive, scrambling to fix issues only after they’ve wreaked havoc. Proactive risk management isn’t just about avoiding disasters — it’s about staying a step ahead, securing your business and creating a more resilient future. Instead of waiting for risks to strike and then relying on insurance to clean up the mess, savvy companies invest in preventing risks before they can do damage.

And here’s why: As the volume and complexity of corporate risks escalate, senior leaders are taking note, but most still fall short on action. A report from North Carolina State University’s Enterprise Risk Management Initiative and the American Institute of CPAs (AICPA) found that only 31% of organizations have a complete enterprise risk management (ERM) process in place. So, why aren’t more businesses leaning into prevention when the stakes are so high?

Related: Your Business Faces More Risks Than Ever — Here’s How to Ensure You’re Prepared for Any Disaster

Proactive risk management: The foundation of success

Imagine driving without seatbelts, relying on airbags to save you after an accident. That’s what operating without proactive risk management is like — it’s not enough. Insurance is a powerful tool, but it should be the last resort, not the first line of defense. Proactively mitigating risks keeps you in control and allows your business to flourish without disruption.

Take cybersecurity, for example. Investing in a cyber insurance policy might give you peace of mind, but it won’t prevent a breach. True protection comes from building robust security systems, regularly testing them and fostering a culture of vigilance. Cyber insurance is essential, but it’s not a substitute for comprehensive cybersecurity. Worse yet, insurers may deny claims if you don’t maintain security protocols, leaving your company exposed.

The hidden costs of risk mismanagement

When risks aren’t managed proactively, the consequences can be brutal. A failure in regulatory compliance, for instance, can lead to crippling fines and penalties — especially in highly regulated industries like healthcare and finance. But the financial costs don’t stop there.

Reputation damage can be equally catastrophic. A single data breach or publicized failure can erode customer trust in a heartbeat, leading to lost revenue, plummeting stock values and skyrocketing employee turnover. And while these issues are devastating on their own, they’re all avoidable with the right risk management in place.

Related: Cyber Threats Are More Prevalent Than Ever–So Don’t Leave Your Business Exposed. Here’s How to Protect It.

Proactive risk management and its impact on insurance programs

For any business, maintaining a clean claims history is essential to keeping insurance costs low and ensuring favorable terms. Insurers assess risk based on past claims, so businesses with fewer claims are often seen as less risky and more desirable to cover. By proactively managing risks — whether through enhanced cybersecurity, improved internal controls or regular risk assessments — you can significantly reduce the frequency and severity of incidents that lead to claims. This approach not only helps avoid the fallout from unexpected crises but also positions your company to secure better insurance rates and more competitive policies.

This principle holds true even for companies with alternative risk transfer strategies, such as captive insurance. In the case of captives, businesses retain premiums paid minus any claims, meaning fewer claims directly translate into higher retained profits. Whether working with traditional insurers or captives, proactive risk management is key to safeguarding your business and optimizing your insurance program.

Actionable steps for proactive risk management

Here’s what you can do to ensure your business is staying ahead of risks:

1. Conduct frequent risk assessments. Identify vulnerabilities across all aspects of your business. Whether it’s cybersecurity, regulatory compliance or operational inefficiencies, understanding where your weak spots lie is critical. Prioritize these risks and address the most urgent first.
2. Build strong internal controls. Internal controls are key to minimizing risks. Establish clear policies for data protection, employee conduct and financial oversight. Regularly audit and test these controls to ensure they’re up-to-date and effective.
3. Prepare incident response plans. Prevention doesn’t mean risks disappear entirely. When something does happen, you need to be prepared. Create incident response plans for your top risks — and make sure to test them regularly.
4. Foster a risk-savvy culture. Risk management isn’t just for the executive suite. It needs to be embedded at every level of your organization. Train your employees to recognize risks and empower them to take action. A culture that embraces risk awareness will keep your business vigilant and ready for anything.
5. Use technology for real-time monitoring. Leverage tech tools that help you monitor and manage risks in real time. From cybersecurity alerts to operational dashboards, staying ahead of threats requires quick response capabilities.

Related: Why Having a Contingency Plan Is So Important–And How to Develop and Effective One

Why prevention is the key to long-term success

In a world of constant threats, businesses can’t afford to wait for risks to become disasters. The pace of digital innovation, the complexity of regulations and the increasing threat landscape mean that proactive risk management is no longer optional — it’s essential.

By investing in prevention, companies not only avoid costly crises but also position themselves for long-term success. Insurance is a critical part of the equation, but it should always come after risk mitigation. The fewer risks that come to fruition, the fewer claims you file and the more your business can thrive.

Ultimately, the choice is simple: Invest in prevention today or pay for the fallout tomorrow.

For every one business that closed in Nevada last year, about 1.3 businesses opened.

That ratio, of businesses opening to closing, makes Nevada the best state to open a small business, according to a new study from AI software company MRPeasy.

“It is interesting to analyze the U.S. states with the highest and lowest rates of small business openings and closures since the ratio reveals economic trends and growth,” MRPeasy director of business development Mike Lurye stated.

The study drew from U.S. Small Business Administration Office of Advocacy data for 2023 to find the number of business openings and closings in each state during the year, calculate the ratio between them, and rank each state in a list. It defined a small business as a company with less than 500 employees.

Related: 1 in 5 Small and Medium-Sized Businesses Could Be Out of Cash By Christmas, According to a New Report

Louisiana, meanwhile, was at the bottom of the list as the worst state to start a small business. It was the only state with a negative ratio of business openings to closures, meaning that more businesses shut down than started in Louisiana last year.

Small businesses are likely to fail: U.S. Bureau of Labor Statistics data shows that 65% fail within the first decade. Over 60 million Americans are employed by small businesses, per U.S. Chamber of Commerce data, and there are more than 33 million small businesses in the U.S. One in five small businesses indicate that they only have one to five months of cash reserves on hand for emergencies, according to a recent study.

Here are the best and worst states to open a small business, based on the balance between business openings and closings last year.

Related: Household Incomes Are Up For the First Time in 4 Years. Here’s Which States Have the Highest Gains.

^{Las Vegas, Nevada. Photo Credit: Getty Images}

The Best States

1. Nevada

Small business openings: 18,296

Small business closings: 8,012

Ratio: 1.284

2. Washington

Small business openings: 29,963

Small business closings: 13,419

Ratio: 1.233

3. Vermont

Small business openings: 4,037

Small business closings: 2,133

Ratio: 0.893

4. New Jersey

Small business openings: 45,577

Small business closings: 24,347

Ratio: 0.872

5. Tennessee

Small business openings: 25,753

Small business closings: 14,543

Ratio: 0.771

6. Maine

Small business openings: 7,379

Small business closings: 4,310

Ratio: 0.712

7. South Carolina

Small business openings: 20,872

Small business closings: 12,344

Ratio: 0.691

8. Idaho

Small business openings: 11,426

Small business closings: 6,765

Ratio: 0.689

9. Connecticut

Small business openings: 15,892

Small business closings: 9,598

Ratio: 0.656

10. Rhode Island

Small business openings: 6,343

Small business closings: 3,836

Ratio: 0.654

The Lowest-Ranked States

1. Louisiana

Small business openings: 11,189

Small business closings: 11,998

Ratio: -0.067

2. Oregon

Small business openings: 17,483

Small business closings: 14,795

Ratio: 0.182

3. Missouri

Small business openings: 28,137

Small business closings: 23,579

Ratio: 0.193

4. Montana

Small business openings: 6,585

Small business closings: 5,439

Ratio: 0.211

5. Minnesota

Small business openings: 17,084

Small business closings: 13,879

Ratio: 0.231

6. North Dakota

Small business openings: 2,892

Small business closings: 2,317

Ratio: 0.248

7. New Mexico

Small business openings: 6,786

Small business closings: 5,352

Ratio: 0.268

8. Virginia

Small business openings: 32,318

Small business closings: 25,336

Ratio: 0.276

9. Nebraska

Small business openings: 6,997

Small business closings: 5,485

Ratio: 0.276

10. Iowa

Small business openings: 9,177

Small business closings: 7,138

Ratio: 0.286