Data shows that there are more than 3,500 power outages per year in the United States. With that type of prevalence, it’s only a matter of time before one of them strikes your company.
This can have several potential negative effects on your company, some of which we’ve highlighted below. It’s why it’s essential to ensure that your business is prepared for power outages.
5 Ways Can Power Outages Impact Your Business
Damaged Equipment and Inventory
Outages commonly cause power surges. These can potentially destroy computers, tablets, and other devices if you don’t have the proper safeguards in place.
Additionally, a power outage could lead to destroyed inventory if you operate a business that needs to keep products refrigerated or frozen, such as a grocery store, pharmacy, or restaurant.
If you’re concerned about these problems, then signing up for business personal property insurance could be your solution.
These plans cover nearly everything inside your business except for the building itself. So if a power outage strikes and damages your computers, inventory, or equipment, you’ll be protected financially.
Loss of Revenue
Power outages can also reduce your revenue in a few different ways. First, they may force you to shut down your business for a period of time. Depending on when this happens during the day, it could be quite costly for your company.
On top of that, your reputation could take a hit with potential customers who try to engage with your business during the power outage.
For example, someone who calls customer service may be unable to get through. And someone who tries to visit your website may go to a competitor’s site instead. These are all situations that can harm your bottom line.
Lost Business Data
Data is the lifeblood of the modern company. As a result, your business may rely on it heavily to optimize its performance in various departments.
But many companies don’t back up their data instantly. Instead, they do it at some intervals, such as every night or every few days. If your company does this, a power outage could cause it to lose a significant amount of data, which may impact its efficiency moving forward.
Power outages also have a significant negative impact on employee productivity. For example, when the power goes out, your workers won’t be able to use the computer or internet.
This creates a situation where you’re paying for all of your employees to be at the office without getting any value from them being there. In addition, it could bring your monthly productivity down significantly depending on how long the power outage lasts.
Higher Operating Costs
Some regions are more prone to power blackouts than others. If you live in an area with frequent storms or extremely high peak electrical consumption, your business may begin experiencing power outages with some consistency.
The net result of that will likely be an increase in your operating costs. For example, the U.S. Department of Energy states power outages cost businesses nearly $150 billion yearly. And you could experience the brunt of that statistic if your business is located in the wrong place.
Minimizing the Impact of Power Outages
By now, it should be clear how damaging power outages can be to your business. But that doesn’t mean you just need to accept the risk. Here are three steps that you can take to mitigate the impact of future power outages in your area.
Consider Business Personal Property Insurance
We touched on it earlier, but business personal property insurance may be the single best way to avoid the impact of power outages. It’s generally available at a low enough cost to fit seamlessly into your existing budget. And it’ll give you coverage for things like:
- Equipment and supplies
- Upgrades that you’ve made to your space
Plus, you’ll get coverage for all of these things in other scenarios beyond power outages. So there’s some good value there.
Invest in Backup Sources of Power
It could also make sense to invest in something like a generator to serve as a backup source of power when it’s needed. However, these do cost a lot, and you’ll need to make sure that it always has enough fuel to power your business during an outage
The cost-benefit analysis will vary from company to company. But generators become a better investment the more often that power outages occur in your area.
Create a Strategy for Power Outages
Finally, it’s important to have a business strategy in place for what your company will do when a power outage occurs. Having this type of plan ready to go will help your employees move faster when the power goes out, saving inventory and reducing the potential damage to equipment.