As I was laying in bed with a back injury, I was wondering how in the world I was going to keep my business going. Then I remembered the Boy Scout Motto , “Be Prepared”. It turns out that I am not all that prepared to lie on my back and watch my business grind to a halt. It has been over a week and is very frustrating, to say the least, this no way to run a business.
Being prepared for contingencies in your business can mean the difference between success and failure; open or closed, sales or no sales. It is very difficult for business owners to be prepared for all contingencies, but it is something we should strive for. It is time to develop a "Contingency Plan" for your business. You can look on the Internet for many different free examples.
The first thing you should do is list as many possibilities as possible. What kinds of disasters are out there that can affect you and your business? Here just a few that I came up with. There are more. Natural disasters; many sick employees; key employee leaving; owner's personal health; loss of a major customer; equipment malfunction of mandatory equipment; fire; identity theft; employee theft; personal divorce or other major issues. The list could go on, but I'm sure you get the idea.
Your contingency plan should cover these and anything else you can think of. Ask you trusted advisers for their input. Try to think of every possible problem so you can map out the solution for each. Listed below are some of the remedies that can help you fix whatever it is that needs to be dealt with.
1. Have the right insurance in place - Be sure to have every basis covered as you can afford to. Business interruption insurance is nice to have but be sure you understand the terms o the policy.
2. Have back up for each necessary function - Cross train employees, use detailed job descriptions, etc.
3. Hold a cash reserve of at least 3 months of operations. This will allow for unforeseen emergencies and a cushion for interrupted cash flow.
4. Have an evacuation plan. If there is a fire or chemical spill, all employees and customers will know how to get to safety. Practice this and train your employees.
5. Develop a phone messaging tree. This will help disseminate necessary informational needed.
6. Have a data loss/recovery plan. Good data is vital to most businesses.
I don't have enough room to make a complete lost. Spend time on this, get employees involved and hope you never have to use it. Good luck.