Disaster planning

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     Disasters happen. Fires, floods, burglaries can strike at any time. A key employee can fall down stairs at home and be laid up for weeks.

     Running your own small business means that you are your own back-up. It will pay off to think about disasters ahead of time. Before the electric goes out for a week, how will your business survive? If your landlord serves you notice to vacate the building, where will you go? If Facebook changes the rules, how will you promote?

     Anything can happen. Big companies have deep pockets and other resources to ride out disasters. But your small business depends on your ingenuity in facing the unthinkable. 

     Example: Jim runs a small computing services firm. The main component of his business is to continually monitor the operating systems of larger firms, assuring them of uninterrupted and problem-free service. He is set up to electronically repair computing problems remotely. He has three employees. One morning, the husband of a key employee called Jim with bad news. The wife had fallen and broken her back--she would not be coming to work for several weeks. Now, with only two employees, Jim was left with a major problem on his hands. He had to scramble to cover the work she would no longer be doing. Her technical knowledge meant that Jim had to substitute himself during her absence. It was a valuable lesson--when she came back to work, Jim set about cross-training his small staff so that each of them could jump in on a moment's notice. 

     Example: Mary is an expert in massage. Over several years, Mary built up her client base and went looking for bigger space. She was careful not to consider ground-floor space because the river sometimes flooded the Main Street. She didn't want stairs involved because some of her clients could not manage stairs. She found suitable space accessible by a ramp in a building with offices that were several feet above ground level. Mary's careful planning paid off. When the river suddenly flooded, Mary's offices were high and dry.

     Example: Ella runs a small graphic arts firm. The business was going well when suddenly the landlord informed her that she had 60 days to vacate the space. The lease gave the landlord that option. It also provided that the landlord would buy out the remaining months of the lease--a clause Ella had insisted on when she signed the original lease. Since there were two years remaining in the lease, Ella received a sizable cash payment from the landlord. She used the money to move, buy new equipment, and add an employee. The disruption in on-going work was significant, but Ella turned disaster into a positive growth option.

     Thinking ahead and planning for the unthinkable can help you sleep better at night. Now, what will you do when the electric goes down for a week? 

     Fire and flood, even key employees, can be covered by insurance. But the best insurance will be in your planning ahead for any eventuality.