Posted on 21 Mar 2013 by Neilson
The Hartford Small Business Pulse: Storm Sandy, which surveyed New York, New Jersey and Connecticut small business owners who reported being impacted during or after Storm Sandy.
The survey revealed that 71 percent of impacted small business owners experienced power outage, which likely led to temporary disruptions in business operations. In addition, approximately three-fourths (74 percent) of impacted owners had to close their doors for a period of time, and it took them an average of seven days to reopen. While only 11 percent experienced structural property damage, 52 percent experienced loss of sales or revenue as a result of Storm Sandy.
"Our research shows that loss of connectivity had a big impact on small business owners, which affected their ability to contact customers and keep their businesses open," said Ray Sprague, senior vice president of the Small Commercial insurance segment for The Hartford. "We have found that small businesses who take the steps to prepare and protect the business, such as establishing emergency communication systems and backing up critical data, tend to be the ones that can prevail after weather emergencies."
Despite the notable effects of the storm, approximately nine out of ten owners (87 percent) said that they were equally or better prepared than other small businesses in their area.
The survey, which was fielded nearly three months after the storm struck the East Coast, also found that:
- Customer issues (65 percent), employee issues (47 percent) and supplier issues (44 percent) were challenges for impacted owners during or after the storm;
- One-third (36 percent) of small business owners impacted said that they were impacted significantly;
- More male small business owners (42 percent) reported that they were significantly impacted compared to female small business owners (28 percent);
- In addition, more impacted respondents had to close their businesses for a period of time in New York (81 percent) and New Jersey (78 percent), compared to Connecticut (64 percent); and
- Impacted small business owners in New Jersey were more likely to have experienced power outage (82 percent) than those in Connecticut and New York (71 percent and 62 percent respectively).
One out of four impacted small business owners (25 percent) prepared for Storm Sandy by creating backup copies of critical data and programs, while 20 percent prepared an emergency kit with essentials (e.g., flashlights, water) and the same amount protected their buildings from the elements (e.g., boarded up a storefront).
Prevailing in the Months Ahead
The survey showed that the consequences of the storm will continue to stretch beyond the immediate impact of a week-long closure. In order to recover from Storm Sandy, small business owners who were financially impacted are taking action, including adjusting their business strategy (35 percent), cutting costs this year (32 percent), and scaling back or stopping hiring new employees (25 percent).
Based on their experience with Storm Sandy, impacted respondents reported they would give the following advice to fellow small business owners:
- Review your property insurance coverage (23 percent)
- Invest in a generator (21 percent)
- Create a backup of important records (15 percent)
- Develop a business continuity plan (14 percent)
"It's important for small business owners to talk with their agents about the right insurance for their businesses and make sure they are prepared for weather emergencies," said Sprague. "This can include everything from reviewing your current insurance coverage and addressing new needs to developing a business continuity plan. For business success, it's critical to prepare for the unexpected and protect the business and employees, in order to prevail in the months and years ahead."
The Hartford Assembles Expert Panel to Discuss Small Business Issues
Sprague and a panel of experts are speaking about the survey findings to New York area small business owners today. In addition to Storm Sandy, the panel discussion will explore the small business landscape and economic trends, as well as what it takes to maintain or grow a business in today's economy.
The panel is comprised of leading small business experts, including Sprague, as well as:
- Mark Jaffe, President & CEO, Greater New York Chamber of Commerce
- Christine Lagorio, Executive Editor, Inc.
- Gene Marks, Columnist, Author and Small Business Owner
- Jennifer Walzer, Small Business Owner and CEO of BackUpMyInfo!
For more information on how small business owners can weather the unexpected, visit www.thehartford.com/smallbizahead, and follow us on Twitter or Facebook.
For more materials and information, visit: http://newsroom.thehartford.com/.
The Hartford Small Business Pulse: Storm Sandy Methodology
Braun Research conducted a telephone survey among small business owners impacted by Storm Sandy for The Hartford. A total of 451 interviews were completed with owners of for-profit businesses with three to 100 employees that have been in business for at least one year in the areas most affected by Storm Sandy. The sample included 150 small business owners within the five boroughs of New York, 150 within the entire state of New Jersey and 151 in the following counties in Connecticut: Fairfield, New Haven and Middlesex. One respondent per business was conducted. The interviews were executed between January 3, 2013 and February 13, 2013. The margin of error is +/- 4.6% at a 95 percent confidence level.