It’s official, the National Preparedness Month is on its way. The only month of the year when I talk about preparedness and people don’t roll their eyes or label me as a doomsday prepper.
Since I knew there would be a flood of “How to” publications, I’m skipping that content and moving to what really concerns me: business preparedness.
Why business preparedness?
Because small and medium sized businesses need preparedness. And because I don’t want to do what everyone else is doing!
The truth is that every year we see more, record breaking disasters. The small and medium sized businesses are facing serious losses. We don’t see big corporations being wiped out by a natural event, or a business interruption. It is the Mom and Pop’s place around the corner, it is the second or third generation restaurant of our hometown, the one that cannot recover and reopen after a disaster or a long-term business interruption. So, no, I’m not going to write about how to, I am going to write about the type of events that could represent a disaster for your business and give you some preparedness tips and recommendations.
These events will be discussed in separate posts. You might think these are small events, and you are right. However, these events could snowball quickly and trigger losses in revenues and clients. Make sure you come back and read all of them which will be published during the month of September.
Event #1 Supplier issues >> third party failures.
What are supplier issues and third-party failures? These are issues and failures that occur outside of your business, affecting your processes, production schedule, delivery of products or services, etc. For example: your supplier of raw materials faces a fire and your order is cancelled. You need that material to produce your final product, which means you must cancel orders or delay the delivery until you find another supplier. Or maybe your delivery vendor goes out of business overnight, and all your deliveries are halted. Can you imagine the headache? Truth is these scenarios are common. You have an agreement with a supplier, and they fail to deliver.
Will you fail to deliver too?
Because no one is exempt from facing a scenario like this, it is important to plan and prepare for these “small” hiccups that can completely halt your business. Now, since I don’t know specific details about your business, I will provide general tips and recommendations that can benefit any business:
- Have backups – I’m not talking about software or computer backups, although those are very important. I am talking about backup suppliers, backup service providers, backup everything. Never put all of your eggs in one basket! If one of them fails, you always have someone to supply what you need: services, materials, personnel, whatever it is.
- Research and create a database – Always be searching for new suppliers and vendors. Ask for their contingency plans, if they have a plan you are off to a great start. Create a database of all those potential suppliers and keep it handy. You never know when you are going to need it. Connect, explore and always be on the look for new partnerships.
- Don’t wait until you are desperate to find what you need, it will cost you more! – Well, if you follow one of the previous tips, you shouldn’t be desperate. But just in case it’s too late be prepared to pay more for what you need, it’s a rule of life. That’s why I recommend planning ahead, you will have more and better options. You will not be acting out of desperation, you will be in control.
- Have an established, written plan, and communicate it with your staff – Write a plan that explains in detail who to call if X fails. Communicate the plan to your staff, partners and contact the suppliers so they know someone from your staff will be contacting them for orders. These simple steps will eliminate confusion, second guessing, and calls to ask you: “what do I do?” Write a detailed set of instructions for anyone to follow, communicate with your staff about the plan, where to find it, and the specific scenarios when they will use it.
As you see, these tips apply to any business. If your business relies on products or services provided by a third party, plan ahead. Third party issues and failures are out of your control, but your plan depends on you.
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