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More than one-third of Canadian small business owners (35%) don’t have a contingency plan, says a CIBC poll.

After experiencing severe weather over the last year, approximately 38% of small business owners in Alberta and 23% in Ontario are re-evaluating their business interruption plans. That compares to 5% in Quebec.

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“The reality is most [small businesses] need a plan in place to ensure they can withstand business interruptions without draining their personal savings,” says Shelley Swanlund, a vice president at CIBC. “It is important to have options such as access to a line of credit, or savings within the business, to tide you over during any interruptions.”

The poll says one in 10 small businesses experienced an interruption in the past year; weather is cited as the main disturbance, followed by illness or personal reasons.

And, 26% of business owners plan to use cash reserves, lines of credit or loans, or personal savings to overcome interruptions; 20% plan to use credit cards or insurance.

Read: Winter didn’t freeze U.S. equities

To prepare for business interruptions, CIBC offers the following tips:

  • Have a business interruption plan. Small business owners should assess the impact of potential business interruptions. Review risks such as length of time you can operate without revenue. Then build a plan to manage the risk.
  • Build flexibility into your plan. Natural disasters and other unexpected impacts can catch small business owners off guard. Be sure your business can withstand these impacts by having a flexible and forward-looking contingency plan to ensure your cash flow, sales, service, and savings are protected.

Read: Business owner optimism drops

Poll Highlights

Percentage of Canadian small business owners rethinking contingency plans after natural disasters in the past 12 months, by region:

National 19%
Atlantic Canada 9%
Quebec 5%
Ontario 23%
Manitoba/Saskatchewan 17%
Alberta 38%
British Columbia 18%

Percentage of Canadian small business owners without a contingency plan for business interruption, by region:

National 35%
Atlantic Canada 43%
Quebec 41%
Ontario 31%
Manitoba/Saskatchewan 32%
Alberta 35%
British Columbia 36%

Originally published on Advisor.ca

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