Phoenix in June 2008 for the NAWBO annual conference
Today, I participated in a radio interview with Ken Morgan and Julie Dougherty, the hosts of Business for Lunch, a program of Phoenix financial news radio station KFNN-AM. As we considered the needs of Phoenix small businesses, I shared with the hosts and their listeners that I had recently returned from Phoenix, the site of the 2008 annual conference of the National Association of Women Business Owners. Together with Erin Streeter of the Department of Homeland Security, I taught a workshop on helping NAWBO members prepare for the worst and plan for the best. Phoenix is blessed by geography, so it is easy to become complacent. But while in Phoenix, I learned of a business that learned the hard way to look beyond the obvious. This was a manufacturer of skin care products that relied on a sole supplier for a critical ingredient. That supplier was under eight feet of water in Iowa owing to the severe floods in the mid-western states. Although she was not directly affected by the disaster, she was indirectly affected – and may lose her business.
What could she have done differently? Her first step should have been to try to diversity her supplier base so she would not be critically dependent on a single supplier. I have, for example, all of my graphics files for letterhead, business cards and other marketing collateral with a printer in Sacramento. When my local printer could not deliver, I called Sacramento and implemented my backup plan. If this ingredient was so rare that she could not have found an alternate supplier, she should have sought contingent business interruption insurance to protect her business against this risk. I suspect that the cost of this additional coverage would have been relatively low.
Ken, Julie and I then talked about the issues around heat waves, a major risk in Phoenix. Did you know that heat waves cause more fatalities than any other natural disaster? If this is a risk for your business, be sensitive to the special medical needs of more vulnerable employees, customers or suppliers. Re-schedule your meetings with them when the temperatures will cool down or encourage telecommuting.
While in Phoenix, I also visited the team at the W.P. Carey School of Business of Arizona State University, who were kind enough to review the book. I look forward to returning to Phoenix. My radio interview with Ken and Julie was a nice break from what was otherwise a somber memorial date.