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If you have and are worried about how the collapse of Phones 4 U will affect your order then please don’t – it’s what we have the Consumer Credit Act for and the in-built protection which comes buying items on a credit card. It might take time but you will either receive your new phone or you will be refunded in full and will not have taken a risk with your cash.

The people to worry about are those who worked for the company which was once worth over £1bn and operated 600 shops across the country. This morning they are potentially out of jobs yet will still have those monthly bills to pay.

Corporate failure is a risk all of us face one way or another but the biggest risk is in working for a corporate which then goes under. I know exactly what it is like as it happened to me although the bank I was working for sank over a period of many months so it was something we could all prepare for rather than face seismic shock that anyone working for Phones 4 U are having to come to terms with as they wake up today and wonder what the day ahead will bring.

Full details haven’t yet emerged of exactly why the business has failed other than the withdrawal of the contract with Vodafone which lead to EE thinking Phones 4 U had an unsustainable future and so they pulled out too. My guess here is that Vodafone saw the profit benefits of selling their contracts themselves rather than through an independent retailer who was able to give expert but unbiased advice and decided that, as they have their own stores, they didn’t need to pay an independent to sell their products for them.

Personally, I think this independence is vitally important. Phones 4 U would get paid whatever they sold so they could truly say that they could offer the right deal for an individual’s phone usage and circumstances as it can be a confusing market and one where not all phone contracts are created equal.

Businesses, as well as individuals, need to take a long hard look at their operating risks and here, with 3 and O2 selling predominately through their own stores and websites and Carphone Warehouse having the safety net of their Talk Talk business, Phones 4 U faced the risk that it was relying too heavily on two sources of income. When that income disappeared as the Vodafone contract was cancelled, the business quickly became unsustainable.

My heart goes out to all those Phones 4 U employees who currently don’t know what the future holds as, like the vast majority of us and their employer, they have relied on that one source of income yet have very many liabilities to meet.

This is exactly the sort of risk I try to help people mitigate, by exploring what their skill set is, what their aspirations are, what their strategy is if they are a small business owner and what their work ethic is really like. Whatever you currently do as your primary source of income, you can look to mitigate this risk and with it the fear that often lurks in the background of “what happens if…..”

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