Contingency Planning For Your Business

Do you engage in contingency planning for your business? If you don't, then you are leaving your business exposed to a tremendous amount of unnecessary risk. Your business may be small, maybe you only have one or two people working for you, but without contingency planning, you are basically taking an 'all or nothing' approach to success. In other words, you are setting your business up for failure if things don't go strictly according to plan. Your plan.

In the Business World, Things Rarely Go According to Plan

The world of business is an interesting and virulent creature. Men and women have often spent months, even years meticulously planning for their business opening. They go into great detail and depth and when they believe they have everything in place, they open their doors or turn on their website. The planning wasn't the problem with most of these businesses that fail before the first year is over.

It was the fact that they didn't have any contingency planning in place. All one needs to do is simply look to the most recent recession that has held the global economy mired in slow business and less spending. Countless businesses opened just before and during the beginning of this recession and most of them have since closed their doors.

Most of these businesses, in reality, had no choice. When consumers are not spending money, then businesses cannot be profitable. It's a fact of life, plain and simple. But, there were still plenty of businesses that had the opportunity to make adjustments in their plans and the way that they conducted their affairs that could have given them an advantage over their competition. These business owners simply didn't know about them, or think about them, because they didn't engage in contingency planning.

Preparing for the worst, and the best

When many business owners open their doors for the first time, they are anxious, nervous, and yet hopeful. They look to the future and see the success that should be coming their way. After all, they wouldn't be investing all of this time and money into something that is inherently doomed to failure, would they? Of course not. They have planned for some slow months in the beginning; it's what they have been taught.

But they don't plan on what to do if things are not working out, but another opportunity presents itself. Charles Howard became an auto industry leader during the Great Depression in the US. He started out fixing bicycles as cars were just taking to the streets. With business slow, he had an opportunity to fix a car, but he knew nothing about them. So, he took it apart, determined how it worked, and changed the face of his business.

This might not have been a contingency plan, but in essence he engaged in contingency planning by looking for the next opportunity to come along and when it did, he took advantage of it. Contingency planning is crucial to the success of any business in our modern society.