Does your business already have an emergency kit?

“Do you already have an emergency kit?” That question has been popping up everywhere in recent weeks. The Flemish government, together with various partners, launched the ‘Samen voorbereid’ (Prepared Together) campaign, which calls on citizens to better prepare for emergencies such as prolonged power cuts, cyber incidents or geopolitical crises. But what about businesses?

Crisis situations often hit businesses faster and harder than families. Disrupted deliveries, rising costs, payment problems with customers: these are precisely the factors that can put a business in difficulty. So, it’s time for an emergency kit for businesses.

For citizens, an emergency kit consists of water, food, and a torch. For businesses, it looks slightly different: preparation, insight, and agility.

A good business emergency kit helps you to:

• cushion financial shocks
• detect payment problems at an early stage
• respond more quickly when the market is under pressure.

In the context of geopolitical tensions, supply chain disruptions, and rising energy prices, this is no luxury. The recent uncertainty surrounding the Middle East and the Strait of Hormuz shows how quickly international events can have a local impact. 

During a crisis, risks can change in the blink of an eye. Customers who are financially sound today may face payment difficulties tomorrow.

That is why every business contingency plan should include:

• An up-to-date overview of your entire customer and supplier portfolio
• Insight into the sectors that are most vulnerable and how they could impact your business
• Knowledge of the financial health of key customers and suppliers.

Particularly in sectors such as transport, manufacturing, chemicals, and retail, we see that risk profiles change faster than traditional reporting can keep up with.

Many companies still check the creditworthiness of a business partner:

• during onboarding
• or once a year

In stable times, this may suffice, but in crisis situations, it is absolutely not enough.

A crisis leads to:

• a faster deterioration in payment behaviour
• sudden adverse events (seizures, legal proceedings)
• unexpected changes in creditworthiness

Continuous monitoring of your business partners is therefore an essential part of your emergency kit. It allows you to detect risks before they translate into outstanding invoices. And everyone knows that outstanding invoices eat into your profit margin and can also cost you an unnecessary amount of time and energy to chase up.

One of the first signs of financial stress is a change in payment behaviour:

• invoices being paid slightly later than usual
• increasing disputes regarding payment terms and goods or services supplied
• requests for deferred payment or payment in instalments

In a crisis, it is crucial not to ignore these signs, but to use them as early warnings. They are often more reliable than historical annual figures, which always lag behind reality.

Read also: What if the payment behaviour in a credit report does not match your findings?

A good emergency kit also means thinking in advance about what you will do if things go wrong.

Consider:

• clear internal guidelines on credit limits
• pre-defined actions in the event of increased risk
• customer segmentation (who requires extra monitoring?)

If you only start thinking about it when a customer stops paying, it is already too late.

The government’s call for citizens to be better prepared is based on one idea: uncertainty is no longer the exception. On the contrary, everyone is convinced that further unexpected shocks will follow.

For businesses, this means financial resilience, and that starts with:

• reliable business data
• up-to-date risk assessments
• the ability to adapt quickly

By not panicking, and by being prepared.