Frugality was not a particularly cool word in living memory, but just as the word geek has been transformed from a term perhaps associated with mockery but geek is the new cool, so the same is becoming true of being careful with money.

Being frugal does not necessarily mean that a person isn’t generous or is tight with money. It connotes being careful, being aware of the value of money and that it is not a commodity that should be recklessly or carelessly wasted.

In business terms, being frugal has always been a significant potential factor in being successful. It’s often the type of nous that makes a good negotiator. When buying goods or services, it’s about knowing when and how to negotiate to get the best deal for you. For example, if your business regularly buys stationary, you shouldn’t be afraid to negotiate with your supplier, in the full knowledge that there are numerous suppliers and really, it’s just a commodity. However, when it comes to choosing a solicitor or accountant, price is just one factor, it’s important to get the right person with the right skills.

Associating being frugal with being careful, an increasing number of switched on businesses are now recognising that we are operating in highly uncertain times. Every business wants to generate business and many are looking for an exceptional opportunity, perhaps to deal with a lucractive foreign opportunity or other high reward possibility, but with the reward comes risk, and we have moved from a period in time where reward seems to have trumpeted rational consideration of risk to a new reality where it is clear that risk has increased in many respects.

The new reality means that for significant business transactions, when dealing with companies or individuals, it’s important to assess who you are dealing with and their reputation. The more important the transaction, the more in-depth the research amy need to be. It can ranmge from basic financial checks which can be obtained for less than £50.00 through to in-depth reports on connections, business reputation, possible financial solvency and human source intelligence which can cost several thgousand pounds or more.

Other increased business risks in the new era include regulatory risks. Laws such as data protection and bribery and anti-corruption are not new but historically there has been considered a low risk of enforcement. Numerous very recent examples clearly show that enforcement is being taken far more seriously by Government and law enforcement. Instances of whistleblowing are also rapidly in the increase, so all businesses, small or large, do need to pay some attention to compliance and having the right policies and procedures in place. Again, it’s an issue of proportionality but doing nothing is not a sensible course of action.

This post courtesy of Blackhawk Investigations, business services and investigations specialists in London.