Are you ready for the worst?
Not $10 gasoline. Not 500% increases in food prices. And no, not a $20 per hour minimum wage.
Nope, I’m talking about a business disaster.
Maybe it’s a flood. Could be a creek that rose or a culvert that clogged, or it could simply be a pipe that burst in an office on the 2nd floor. Perhaps it’s a fire, even a small one that gets put out quickly.
A client of mine in the East owns a gourmet pizza shop. 10 days ago as I was canoeing the length of Hungry Horse Reservoir (both ways!), lightning struck his restaurant.
According to the fire department, a faulty ground wire sparked the fire in the door-less utility closet. Luckily the fire was contained because a PVC pipe to a utility sink melted and sprayed water all over the place. Of course, it did this until sometime the next day when the damage was discovered so there was not only fire damage but water damage as well. Lots of smoke damage, lots of greasy, smoky water all over the place.
The things you don’t think about in a disaster like this are the unknown costs of getting things going again. Like throwing out all the food in your building and restocking it all. Dry goods, perishables, you name it.
My friend feels like his only mistake was that he would have liked to have higher business interruption coverage, but otherwise he was well-insured. Not everyone is that lucky.
So what does he do next?
First off, he has a few things in his favor. While his retail area is still closed (probably won’t be able to open until next week), he has two things that make life a little easier for him.
First – he has a reward program in place. Yes, that’s another subtle hint.
You guessed right that this is the same thing we’ve talked about several times. Not a lame reward program where you hand someone a paper card without collecting their contact information, but the smart kind. A smart program collects their contact info so that you can inform them (and only them) of important changes, sales, promotions, or special reward events without spending big bucks to advertise all over the place. There’s a time for that sort of advertising, but it isn’t when you have a specific list of people to contact – your very best customers.
Second – he has a network of friends – including competitors – with restaurants and commercial kitchens. This has allowed him to keep delivering already booked catering gigs and accept more without wondering how he’ll deliver them.
Other than that, his main concern is that people will drive by and see the place closed. Next time, maybe they don’t even drive that way because there’s no place to eat down that street.
That’s what we got to work on right away.
First off, I had him issue a press release to the local media outlets. We didn’t create a boring “Fire at , will be closed for 3 weeks” kind of piece.
Instead, we had a little fun. While doing so, made two things very clear – that he is still open and serving catering clients – and that they’ll be open for retail dining on a specific date. The fun was injected to make it interesting enough to provoke the local TV stations to do a spot piece about it.
In addition to that, I suggested he get some light – any light – inside the shop ASAP, even before he’s allowed to reopen by the health department. His outdoor sign is lit and he has a sign on the door that takes the fire lightly and talks about the influence of a higher power affecting their menu choices.
Once he opens up, he’s been instructed to park several cars in front of the restaurant so that when people drive by, it looks like there’s a crowd. After all, no one wants to go to an empty restaurant. A crowd of cars sends the message to passersby, “Hmm, must be good food, maybe we should stop there.”
Next week, we’ll talk more about surviving a business disaster.
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