This winter, some small businesses have been devastated by the effects of the floods. Unfortunately, there’s another potential threat too - power shortages. Whether that’s as a result of the poor weather conditions or due to a shortage of power in the National Grid, we show you how to get ready.

In the news, there are reports that a lack of planning costs businesses money, and the chancellor has warned about threats to the UK economy.

Top news stories

Poor planning could cost small businesses £25 billion in 2016     

26% of UK business owners don't have a business plan in place yet data shows that working to an effective business plan supports revenue growth.

George Osborne warns UK economy faces 'cocktail of threats'

George Osborne has warned of the risks to the UK from the shaky global economy. Businesses seem to be wise to this with the economy being the top concern.

Less that 25% of employees felt motivated at work in 2015

The report also found that 46% of respondents have neutral or negative feelings towards their job.

Workers favour higher salary over staff benefits

Research found that 49% only rated their perks as OK. If given the choice, 85% of employees would rather receive a pay rise or bonus instead of workplace perks.

Decision makers lose 34 nights of sleep a year

The average business decision maker said they lost an average 5.27 hours of sleep per week, adding up to more than a month every year.

Key dates for your diary

11 January: The Exclusivity Terms in Zero Hours Contracts (Redress) Regulations 2015 comes into force. This puts in place the ban on exclusivity clauses in zero hours contracts, so workers can take more than one role. More information on the Government website.

31 January: Deadline for online submission of Self Assessment tax returns for tax year ended 5 April 2015.

31 January: Deadline for paying Self Assessment ‘balancing payments’ for tax year ended 5 April 2015.

31 January: Deadline for first Self Assessment payment on account for tax year ended 5 April 2016. 

How to prepare for electricity shortages

Since July, we’ve heard reports that there may be power shortages this winter. The National Grid was keen to play down the risks but did concede that “that electricity margins for that coldest, darkest half hour of winter are currently tighter than they have been”.

While it’s hoped that power shortages can be avoided, the bad weather has also brought power cuts as substations flooded and high winds brought down power lines. The impact for businesses can be significant. So how can you be prepared?

Identify critical systems

This will depend on your type of business, but if your refrigeration, security systems or other business-critical systems run on electricity, then these are the ones to consider first. Make a list of all your systems that need power and prioritise them as high, medium and low. Don’t forget to include things like heating, which may rely on electric pumps, and phones, which may need power to function.

Think about how your employees and customers could leave safely if there was a power cut. Darkness, no lifts and loss of power-assisted doors can all have an impact. Make sure your risk assessment covers this.

Put a risk assessment in place to show what impact the loss of electricity could have on your business and how you might mitigate these risks.

Look for alternative solutions

There are options to minimise the impact of power cuts. Here are some things to consider:

• Consider back power: Being able to manage for a short time without power may be essential, so think about alternatives to the National Grid. This might include small solutions, like buying spare batteries for laptops and keeping them charged, or it could be bigger systems, like getting a generator.
• Consolidate systems: if you’re running multiple systems, think about whether you could consolidate them. For example, if your business uses freezers, could you move all the contents into a single one and run that on back-up power?
• Think about changing locations: for some businesses this won’t be possible but if you have an office, consider allowing staff to work remotely if there homes are unaffected by power cuts. You could also consider moving to alternative premises which might have back-up power. It’s worth making enquiries now if your risk assessment shows that a loss of power would have a significant effect.
• Speak to your landlord: if you don’t own your own premises, speak to your landlord to see if they have any plans to handle a loss of power. For big offices, there may already be a generator. If you are the sole occupant in your building, ask if there are any restrictions that may stop you implementing your risk plan.

Check your insurance

If the risks to your business are high (loss of stock, loss of business, etc) then check you have sufficient insurance cover and that your policy specifically covers power outages. And make sure you have adequate cover - while you should review your insurance regularly, it’s easy to get out of date, especially if your business has expanded and has more stock or a higher turnover.

You can also get “business interruption insurance” which covers you for loss of income due to an unforeseen event.

Cut down on your usage as much as possible now

The National Grid says there is less contingency, but they do take measures to ensure there is enough energy available. One of these measures is to ask industrial users to use less, but it’s good advice for everyone. This not only ensures reduces the risk of power cuts, it also means your bills will be lower. Our recent article explains some ways to do this.