SMEs unprepared for business interruption

New data from the Federation of Small Businesses (FSB) shows that many SMEs are not adequately prepared for possible external shocks to their businesses from internal and external threats.

According to research, part of a wider forthcoming investigation into how the UK can better use supply chains, nearly two-thirds (65 per cent) of SMEs and the self-employed do not have any plan to cope with potential disruptions to their business operations or their supply chains.

Customers not paying for goods or services was the number one risk (51 per cent), followed by the loss of key members of staff (37 per cent).

Impact of cybercrime (17 per cent), transport problems (15 per cent) and severe weather (13 per cent) were also key concerns, with SMEs being more vulnerable to risks due to their size and lack of resources.

Commenting, FSB National Chairman, Mike Cherry, says: “Small businesses face a number of threats on a regular basis and it is vital they are prepared to deal with them. By implementing continuity plans, small firms can prepare for many of the sudden changes that can impact on them directly and their supply chains.

“One key step towards ensuring a business is prepared for any supply chain difficulties is continuity planning. This includes identifying the most significant risks to a business’ commercial operations and creating a plan to mitigate those risks should any of them materialise.

“The costs that businesses face when their supply chains are impacted can be severe and therefore it is crucial that we stress the importance of planning for the future.

“Given the likelihood that an enterprise will encounter some sort of business interruption issue more than once in their life, it is key to resilience that firms are encouraged to consider all risks that they could face.”

Business continuity planning is a collective responsibility and it is essential that SMEs take the necessary steps to protect themselves accordingly.

Click here to find out more and make sure your business is protected.

Our business experts at Beavis Morgan work with many entrepreneurial businesses across a range of sectors, helping them set up and run their own businesses and guiding them through each stage of the process, whilst navigating the challenges and advising them in making the right decisions both now and for the future.

If you would like to find out more about how we can assist you and your SME business, contact Steve Govey or your usual Beavis Morgan Partner.

Further reading: SMEs must consider supply chain disruption in business continuity plans