Five Contingency Planning Tips For Your Small Business

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Contingency Planning

The world of small business management is unpredictable and challenging. Whether you run a small retail store, eCommerce business or you’re a self-employed tradesperson, unforeseen and unexpected circumstances can threaten the very existence of your venture. Contingency planning is an essential process for all businesses to undertake, preparing an organization for the wide array of events or incidents that could occur at any moment. Natural disasters, staff shortages, security vulnerabilities, and global pandemics (and much more) can all disrupt your business proceedings – so what are some tips to aid your contingency planning efforts?

Focus on key risk areas

Some contingencies will undoubtedly be more likely than others. For example, certain regions of the UK are much more susceptible to localised flooding than others, so this should be a high-risk scenario if you are in those vulnerable areas. Events like these should receive more time and thought than more unrealistic circumstances – so focus on these predominantly. Other key risk areas may include staff shortages, supply chain issues, theft, and emergencies such as fires.

Set out clear steps for each contingency

For each identified contingency, you should set out a clear and unambiguous response to tackle the situation. This should include key and easily actionable steps for all relevant parties involved. A pre-planned response will help to avoid panic throughout your small business by providing clear instructions to any involved individuals.

Take pre-emptive steps

Of course, there are other pre-emptive steps you can take to prepare for contingencies besides planning your response. These can include investing in business insurance to hopefully cover any losses or damages you experience and reinforcing your security measures to lower the risks of break-in attempts and arson. Furthermore, you should ensure that you have the appropriate fire safety measures in place at your premises, such as fire extinguishers, smoke detectors and door closers to stop the spread of flames.

Outline key roles and responsibilities

Your contingency plans should outline the key roles and responsibilities of employees or managers in the business. They should also set out the steps to be taken by each position in the organization, so there is always someone responsible if employees are replaced. If you’re solely liable for the running of a business, a clear contingency plan will help to hand over responsibility if you ever need to take time off for any reason. If you have a small team around you, a contingency plan will help to prepare anyone who may be present at the time of an emergency.

Create accessible documents

Finally, contingency planning should result in an easily accessible document, distributed as and when appropriate. This will help to make response times more efficient in the event of an identified contingency, as opposed to people trying to find the sole copy of a contingency plan. Furthermore, an accessible contingency document will help the process of handovers for any staff who are away for any period of time.