Small Business Trends: Business Continuity Planning

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How often have you heard a story like this?  The owner of a home-based jewelry business loses the computer that contains her 500-customer mailing list, and can only reconstruct 150 names from memory.  It takes five years of hard work, a costly ad campaign, and a new website for the jeweler to bring the database back up to 70% of what it was before the data loss.

Or how about this one?  An aging chef plans to transfer a successful restaurant to an assistant in increments over time, but unexpectedly dies before the agreement in signed.  The kids can’t agree on a sale price, and the assistant cook doesn’t have the funds to buy it outright.  The business goes under and the employees lose their jobs, while the vacant building is eventually condemned.

When thinking about business continuity planning, people usually think about disaster planning.  But here in Central Louisiana, it is often more important to engage in planning for operations problems like these.  For example, what will happen if the local government repaves the road in front of your business, making it more difficult to turn into your driveway? If your business is one that relies on people “popping in,” you will experience a negative cash-flow for the duration of the construction.  Knowing ahead of time how that cash-flow situation can be managed can mean the difference between staying in business and going under.  Small businesses that engage in business continuity planning help ensure their survival, minimize lost revenues, and gain competitive advantage.

Until recently, small business owners had limited access to the resources needed to develop business continuity plans.  Professional business continuity planners are expensive to hire because each plan is unique to a particular business.  Therefore, most consultants work exclusively with large businesses that have the funds to pay for the extensive services they provide.  After Hurricanes Gustav and Ike hit Louisiana in 2008, the impact of this lack of planning on the small business community became apparent as many small businesses as far inland as Central Louisiana were impacted and some even closed.  As a result, the U.S. Small Business Administration provided funds to add business continuity consultants to the staff of the Louisiana Small Business Development Center.

These business continuity consultants specialize in risk management, insurance, technology, succession planning, and related business continuity areas.  Like the services offered by the regular business consultants at the LSBDCs, these consultants offer no cost one-on-one counseling and low cost training programs  to small businesses and nonprofit organizations.  They will come to your place of business and work with you on a schedule that is convenient to you and your business needs.  All small businesses and nonprofits in Central Louisiana are encouraged to contact the LSBDC at Northwestern State University at (318) 484-2123 to get started. 

Funded in part through a cooperative agreement with the U.S. Small Business Administration, Louisiana Department of Economic Development and participating universities. All opinions, conclusions or recommendations expressed are those of the author(s) and do not necessarily reflect the views of the SBA.  All SBA programs are extended to the public on a nondiscriminatory basis.