Don’t let setbacks derail your company’s growth.
I owned a beverage distributing business in Atlanta for six years. When my business was still young and I only had one driver and one delivery truck, I faced a crippling setback: My driver had an accident. He was unscathed, but my truck was not, and since it was my sole source of income, I lost money each minute it sat banged up and broken in my parking lot.
My driver had been in fender benders before, but after each one, my truck still ran. This time was different. To make matters worse, since my driver had been in so many accidents, my insurance agent threatened to cancel my policy. I had to have a truck to deliver my products, so I scrambled to find a replacement and soon found a truck-rental company.
I learned a valuable lesson: Always keep an extra truck in the parking lot. Why did I not consider getting a second truck before my truck was out of commission, especially since my driver had been in accidents? When I thought about getting a second truck, since I had so many tasks I had to complete now, I told myself I would figure it out later. And never did.
Make a Plan for Backup Solutions
Losing my delivery truck taught me I needed a backup truck, so when I went to the truck-rental company, I rented two trucks. From then on, I always kept a backup truck. I also learned a second lesson: Plan. This accident did not ruin my business, but having to rent two trucks for a week put a financial strain on my business and an emotional strain on me.
I remember thinking afterwards I should have seen this coming—and should have prepared for it—so I promised myself I would not be surprised again by a setback. I sat down and listed all of the major and minor setbacks that could happen to my business. Then I found a solution for each of them. If you have not done this yet for your business, you should.
Some of the questions you should consider:
» What would happen if your building caught fire? Do your employees know the escape routes and where the fire extinguishers are?
» Building on that, what would you do if your office wasn’t usable because of fire, flooding or some other unexpected disaster? Could your employees work remotely? How would you communicate with your clients?
» What if your most valuable employee leaves or experiences a major illness? Do you have someone else on your team who could cover that person’s duties? Could you temporarily outsource? Do you have an operations manual that could be used to train the temporary help?
» What would you do if you lost your single biggest client? Do you have a reserve fund to cover expenses or—even better—do you have systems in place to warn you from becoming too reliant on any one customer in the first place?
» What if your online accounts were hacked? How would you respond? How could you prevent an intrusion?
» What if a key piece of equipment went out of service at a critical moment?
» What if you experienced an interruption in your inventory? Do you have other suppliers who could step in?
» Kansas City is in Tornado Alley. Do your employees know where your tornado shelter is and what items are kept in the shelter?
Reacting Is Too Late
When discussing setbacks, preparation is the key. If you have taken uninterrupted time to consider what to do in case of a setback, when one happens, it will not hit as hard because you will have a plan in place. You and your employees will remain calm, knowing you will overcome the setback by simply following the plan.
When a setback strikes and finds you without a plan, you panic. You need to find the right solution, and you need to find it quickly. If you do not, you may lose your business. This creates a mountain of pressure and fear, and you have to find the right course of action in the midst of all of this.
Facing a setback is bad, but facing a setback when you are unprepared is worse. It is also an excellent way to make a horrible decision. One of the best ways to make a minor setback a major one, or a major setback a crisis, is being forced to make a quick decision.
When you plan ways to respond to setbacks, you will not only find creative solutions, perhaps more importantly, you will also find ways to prevent those setbacks. Fire alarms and escape routes save lives in a fire, but sprinkler systems and fire extinguishers prevent blazes from starting.
We experience setbacks in business and in life. Some are annoying and short-lived. Others are costly and devastating, and they leave painful lessons we never forget. Regardless of its severity, a setback always teaches a lesson, but I learned the hard way it is far better to find a solution to a problem before you have the problem.