What’s Your Small Business Contingency Plan?
Life is full of twists and turns, so it’s impossible to know when something that needs everything to come to a complete stop might happen. Whether it’s a technology problem, power failure or even hazardous weather causing problems; if you don’t have a solid backup plan in place for your small business, will there be anything left when you’re ready to return to it?
As small business owners, we tend to neglect looking at things that might go wrong, but when you fail to plan for every eventuality, then you really are planning to fail. Life’s unexpected events can really throw a small business for six, and many cannot survive without a contingency plan ready to spring into action and keep things ticking over.
Sometimes known as a “disaster plan” or as my VA colleagues like to call it “the red bus plan” (because who knows when you might get struck down by that big red bus), it’s basically a plan you put in place about how your business would continue were something to happen to the building you work in, your equipment, or you yourself.
Luckily, there are just a few steps you need to take care of to have a contingency plan in place and ready to go when needed, so let’s take a look at what they are.
1. Make sure someone else can access your passwords
Whether it is an internet supply issue or a personal emergency, it’s time away from your computer and programs that affects the day to day running of your business. When you cannot inform your clients of what’s going on, complete work, continue marketing and take payment; your business grinds to a halt.
Even if you have some associates on standby ready to look after your clients if the unexpected should happen, can they access your programs and systems to complete the work?
Although you shouldn’t really share passwords with anyone, if a crisis occurs then someone needs to be able to log in to things quickly and easily to keep things ticking over. LastPass actually has an emergency access function that enables onetime sharing of your password fault in an emergency situation, giving enough time for your trusted person to access everything they need to look after your business.
2. Plan how you will inform your clients of any problems
Make sure there is a clear communication plan in place to alert your customers of any issues. This is where having CMS backups and easy access to your programs passwords is important. Obviously, this needs to be GDPR compliant and that you mention necessary third-party data processing in case of emergency.
Things to consider are:
- What’s the best way of telling clients there’s an issue?
- How quickly can they be told/when do they need to be told?
- Make sure they have a trusted contact they can communicate with in your absence
- How to keep communications open during a long crisis period, i.e. a hospital stay or family emergency
Good customer service is crucial to a successful business and when deadlines are due, it is important that your clients are made aware of any potential delays or problems. In most cases your clients will completely understand your situation and be fine with the delay, but this gives them the opportunity of going elsewhere if waiting isn’t feasible for them. It’s a good idea to have a list of trusted alternative providers that they can be referred to in this instance.
3. How will you keep on top of your business finances?
Cashflow is what keeps your business ticking over, and unfortunately, even though you may be dealing with a disaster personally or professionally, those bills still need to be paid and invoice payments collected. Going overdrawn and being cut off from suppliers isn’t a healthy situation to come back to when you’re able to come back to work again.
Identify the best person to stand in for you in terms of managing your business finances. Family members and friends are probably going to be too involved in your personal life and what’s going on there to be able to help with this properly, so consider a trusted associate, colleague or even your accountant instead.
Make sure there’s a clear plan for them to follow that tells them what they need to know about your business finances in terms of:
- when bills are due and how they are paid (including access to programs they’ll need)
- when invoices are due, how they’re generated and how payments are received
- contact details for suppliers, clients and your accountant/bookkeeper
- access to your bank account (if really necessary)
4. Who will take care of your business admin while you’re gone?
Emails and phone calls will need to be answered, voicemails returned and that paperwork can quickly turn into a mountain if it’s not dealt with straight away. Good customer service and business processes are vital for keeping your business going while you’re away, so who’s the best person to take care of that for you?
If it’s going to take time to train someone up and show them the ropes, you should consider hiring a virtual assistant for this task. Most VAs already have the training and experience in general business administration that they can hop on board and take care of things after just a few conversations about how you do things and what you expect to happen.
A test run is often a good idea to make sure things go to plan and you can iron out any problems you hadn’t considered. This might be perfect for a holiday or short break so you can really switch off from work for a few days, or even just a day every few months so you can get on with other things.
5. Have a formal agreement with your trusted person(s)
Hopefully, you’ll never need to fall back on your contingency plan, but if you do, then you need peace of mind that things will be looked after well and that you’ll have a business to come back to when the emergency is over.
It’s so important to put a contract or formal agreement in place that’s legally sound to make sure that you and your business are protected when someone else steps in on your behalf. Although going to a small business lawyer can be expensive to get this sorted, it will be worth it if the worse should happen and you need to take legal action to correct problems caused, or worse, have clients take legal action against you.
Every business has vulnerabilities. From internet disconnection for a few days to staff/associates and quality control. These potential risks are unique to every business and is why you can’t take a “one size fits all” contingency plan from the internet and apply it to what you do, even if it has been designed for your particular industry and job role.
Chances are that you may never have to use your contingency plan, but that can lead to a complacent approach that leaves your plan neglected and no longer fit for purpose. With technological and legal changes taking place so often, you should review your contingency plan annually to ensure that your identified risks are still the same and that you have the right remedial actions highlighted to remedy them.
Creating a contingency plan can be a lengthy process but it’s one that’s worth doing if you want to be certain that your business can survive a crisis or disaster that’s out of your hands.