When a catastrophe such as hail or fire affects your greenhouse, it can lead to difficulties that result in a shutdown. Aside from the distress of lost inventory, missing a peak sales time can be devastating to your bottom line.
It’s never been more important to create an effective business continuity plan. Extreme weather events and costly disasters are occurring much more frequently. In 2021, weather and climate disasters across the U.S. totaled $145 billion in costs according to the NOAA. Global influences, such as COVID-19 and supply chain disruptions, have already caused temporary closures and complicated recovery times throughout the horticulture industry.
The COVID-19 pandemic has contributed to severe supply shortages and we expect supply chain issues to continue through 2022. We’re currently seeing cases where it takes up to six months to get a business up and running again, when typically it would only take three months.
Establishing Your Business Continuity Strategy
Data from FEMA shows that about 25% of businesses don’t reopen after disasters. The more quickly your greenhouse can act and recover, the better chance your business can resume operations.
That’s why a continuity plan — with processes and contingencies outlined for your greenhouse — is your go-to playbook for restoring critical procedures when faced with an interruption. Build your plan with the following features in mind:
- Recognize the risks that could leave your employees, customers, and vendors vulnerable.
- Determine your critical business operations and prioritize their recovery.
- Outline your emergency response, public relations, and employee communications.
- Test and update your plan annually. Train employees to understand their role in the plan.
Identifying Your Greenhouse’s Risks
A risk assessment is your first step in developing a plan for your critical functions and services. The assessment can help you identify the probability of threats to your business and evaluate their impact if they were to occur.
Common risks to consider:
- Wind
- Snow
- Hail
- Fire
- Cyber attacks
- Crime
- Logistical delays
- Flood
Whether you face a cyberattack, hailstorm, or an electrical grid failure — such as the 2021 cold weather outage in Texas—your business should be prepared when it relies on other businesses for supplies, technology, and transportation.
Determining Impacts to Your Greenhouse
A business impact analysis is one of the next important steps when building your plan. The analysis can help you pinpoint critical business functions and their financial impact on your greenhouse if they’re affected by an interruption.
Evaluate the following factors of each business process you identify:
- Operational impacts
- Financial impacts
- Timing
- Duration
Taking the time to understand and address these factors can help you determine your recovery priorities and strategies. It’s a good idea to periodically review and update your impact analysis since the elements of your business change over time.
Creating a Communication and Response Plan
Whether an incident causes a major disaster or temporary downtime, outlining a clear response helps reduce the chances of miscommunication. Make sure your continuity plan includes emergency response, public relations, resource management, employee communications, and customer notifications.
As you discuss your response plan and the necessary parties involved, consider including the following information:
- Key personnel
- Roles and responsibilities
- Updated emergency response contact information
- Internal and external communications plans
- Inventory and equipment checklists
- Locations of data backups and backup sites
- Backup site providers
Putting Your Continuity Plan Into Practice
Once you’ve built or refreshed your business continuity plan, don’t set it to the wayside until an incident occurs. Roles, responsibilities, and your business change — and an effective plan should reflect the most recent changes that could impact your response to an incident. Test and update your plan annually, and any time critical functions, structures, or suppliers change.
Train your employees to understand their assigned roles and responsibilities in the plan. Consider doing dry runs of various disruption scenarios, especially when onboarding new employees. If a shutdown does occur, assess and update your response when it’s fresh in your mind. Your goal is a quick recovery, and a well-practiced plan can help make that happen.
You can’t be totally prepared for every disaster that affects your business, but fine-tuning the strategy will strengthen your approach to a future crisis.
Reviewing Your Insurance
Insurance by itself isn’t a business continuity plan for your greenhouse, but it does play a large role in your business’s recovery after an incident. Your operations and risks will vary, as will your policy, however the following coverages may help add a level of protection to your business. As always, talk with your insurer to discuss your risks and coverages.
- Commercial property can help cover buildings and greenhouses, equipment breakdowns, crops and inventory, and business income.
- Umbrella liability is an optional coverage that can help protect your business in the event of a catastrophic liability loss or a huge judgment against you or your company.
- General liability can help cover property damage, product protection, and chemical applications. It can also include cyber liability.
- Professional liability can help cover losses connected to the operation of your business. It includes employee benefits, cyber liability, errors and omissions, and director and officer liability.
- Commercial auto can help cover company vehicles if they’re involved in an accident. It can also cover your business if you or an employee use a personal vehicle on behalf of the business.
By sharing these tips, my goal is to help you revisit your greenhouse’s business continuity plans. The information I’ve shared can help you get started, but it shouldn’t replace the conversations you have with your local experts and insurer. The time you take now to update your plan can help your business act and recover faster when faced with future interruptions. Remember: a business continuity plan, along with appropriate insurance coverages, can be your greenhouse’s lifeline during a catastrophe.