It is a beautiful pre-Covid April afternoon in Philadelphia. Suddenly, a dump truck careens out of control and snaps a utility pole supplying electricity to many businesses and homes!
Jake’s hamburgers suffered a power outage during the lunch rush on a Tuesday. No one knew what to do. The only light was coming through the windows but with no windows in the kitchen, no one could see anything. Staff had to use their cell phones to see anything. Customers waiting for their orders were told to go home as there was no way to process customers orders through the tablet checkout system. The mobile order system was also down so 20 customers who put in orders would not get their order and were not told that there was a problem in the store. 24 hours later when the power was restored, the owner discovered that $1000 in meat and food products had risen to room temperature and had to be thrown out. Customers complained on social media and impacted Yelp and Google business scores. The owner estimated that the company suffered a $4000 loss from the power outage in lost business and inventory and attributed a 10% reduction in sales for the next year due to that incident.
Riley’s Smoothie Bar is right next door to Jakes Hamburgers and were impacted by the same 24 hour power outage. The owner had planned ahead by creating a Business Continuity Plan and investing $1000 in backup power equipment. When the lights went out, emergency lighting kicked on and portable LED lights held in storage were deployed for the staff and customers. UPS systems on the checkout and order taking systems prevented the computers and internet going down so the pending orders were able to be completed. The staff was able to temporarily close the online store with a message apologizing to customers but they had to close due to a power outage. After an hour with no power, the manager deployed their portable generator out back and ran extension cords to complete pending customers orders as well as keep their freezers running. 24 hours later, power was restored, no inventory was lost and there was no customer backlash from the closing. The owner estimated that the company suffered a $400 loss from the power outage and sales were not impacted beyond the day of the outage.
The average property in the US experiences 2 hours of power loss per year. However, this can vary greatly depending on your location in the country as well as your local location. While this serves a minor inconvenience to homeowners, it can be harmful to a business owner, halting business while expenses continue to accrue in salary and other overhead. For some, even a short power outage can destroy inventory that requires powered equipment to maintain (ie food supplies). Significant utility outages lasting days or even longer can be downright devastating.
Which company are you going to be? Are you going to be the owner of Jakes, betting that the power never goes out but risk major financial and reputational damage? Or will you be like the owner of Riley’s and with a $1000 investment in backup power equipment, remain resilient and suffer little impact from a power disruption?
What many business owners may not realize is that with a bit of pre-planning and a minimal investment, they can maintain all critical company functions and keep their doors open without customers being the wiser. But every business has different needs. Here, we explore basic options that would satisfy most businesses and some more advanced options that larger, more complex organizations should consider. Here are 4 steps that EVERY business should take to prepare for the inevitable power interruption.
Assess your critical asset power needs in the table below:
When assessing your needs, what’s really important is what critical functions your company must maintain. For each one of those functions, determine if your plan is to generate, reallocate or relocate.
Determine where you should invest in backup power supply needs.
1. If power is lost in your office/location only, is there a neighboring company who would be willing to let you run an extension cord to your business? If so, make sure you have a reciprocal agreement in place to help each other out in an emergency
2. UPS backup battery – An uninterrupted power supply is an amazingly effective and affordable option for companies with just a handful of critical assets. This one from Amazon
allows you to plug 6 devices into it and when the power goes out will instantaneously switch to battery power without missing a beat. This is a short term solution only as the average UPS will only be able to power an asset the size of a desktop computer for 1-2 hours. But that may give you the time you need for the power to be restored or to make other, long term arrangements.
3. Portable Power Stations - $100-$500. These are basically large batteries that you can use as a stopgap between a desktop UPS and continuously generated power. Some can be connected to solar panels (sold separately) for continuous power generation and recharging. This Jackery portable power station sells for $200 on Amazon.
4. Portable generator - $500-$1000, gas powered portable generators are probably your best option for medium or even short term power outages. As long as you have gas to keep the generator running, other than about an hour cool off time every 8 hours or so, you can keep multiple lights on indefinitely. Consumer reports highest rated portable generator is the DeWalt 4000 Watt and is sold at Home Depot for $549. The major downside here is that the generators are loud and need to be kept outside so this is not an option for, say, an office on the 3rd story of an office building. You will also need to keep a supply of power cords and power strips on hand. Make sure you don’t try to plug in too many devices as a portable generator can only generator so much wattage. It is also a good idea to have circuit breaker power strips as minute power surges often occur with this type of generator and can damage sensitive electrical equipment.
5. Pre-connected generator-$2000 and up. This is the ultimate emergency power solution. Pre-connected systems are designed to power your entire facility and can either be manually engaged or configured to auto-engage when a power loss is detected. While these are not instantaneous ensuring uninterrupted power, the power loss is usually brief at around 10 seconds and usually only cause a minor disruption to operations. While the previous options are doable for any business owner to setup, this type of system would require a specialized contractor to install. Enough to power a single family home, this Champion Power Standby Generator is currently sold at Home Depot for $2500.
If you have office space, account for emergency lighting needs. Even if you have emergency lighting, you still may need light to safely operate. I recommend every company consider rechargeable LED lights which can be found for about $15 each on Amazon. They are powerful and will last for hours. You can even charge devices via USB from some of them
Get those emergency assets in place, update your business continuity plan and TRAIN your staff on how and when to use them
Tell your insurance company, investors and major clients the steps YOU took to make your business stronger and more resilient.
Remember, if you are failing to prepare, you are preparing to fail.
Check out the companion youtube video, Planning for Power Outages: Small Businesses on our youtube channel and feel free to subscribe.
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