Business continuity has come a long way over the past decade with enterprise-grade data protection accessible to small and mid-sized businesses. Is your business continuity plan fit for purpose? Do you have a business continuity plan?
IT disruptions can have a heavy toll on your business, with idle workers, production stoppages and revenue losses. Fire, floods and other natural disasters remain dangerous threats that put some companies out of business every year. Not mention the risks from malicious activity such as hackers and ransomware.
It is a jungle out there.
Let us look at what some of the numbers say.
(1) 54% of companies have experienced prolonged downtime
More than half of companies (54%) experienced a downtime event that lasted more than 8 hours – one full work day – in the past five years.1
(2) 40%-60% of small businesses never reopen after a disaster
This statistic is attributed to FEMA, is widely accepted and is quite startling. However, the author was unable to find the source of this statistic. The reality is probably much less and this statistic probably includes the failure of a lot of small businesses in their first year.2 Regardless, there is a risk of not reopening after a disaster.
(3) 90% of businesses fail if they don’t reopen quick enough
This statistic is also attributed to FEMA but the author was unable to find the source of the statistic. Again, it probably includes the business failure of a lot of small businesses in their first year.2
However, the longer the recovery takes, it is reasonable to conclude that the risk of permanent closure increases. Businesses have fixed costs which occur even if they are not generating an income. FEMA assert that 25% of businesses fail to reopen after a disaster.3
(4) Few small businesses have a business continuity plan or disaster recovery plan
Many quote FEMA in saying that 20% of companies have no disaster recovery plan in place. However, an authoritative source for this statistic could not be found and the author suspects that the number of small businesses with a comprehensive and tested business resumption plan in place is much less than 20%.
To help prevent and respond to a disaster, every business must have a comprehensive business continuity plan or disaster recovery plan. This helps businesses understand the risks they face, identify appropriate solutions and recover quickly following a disaster.
(5) Downtime costs between $10K to $5M per hour
According to Datto, a downtime incident can cost anywhere from $10,000 per hour for smaller businesses to more than $5 million per hour for enterprises.4
(6) Only 2% of businesses recover in less than an hour
Recovery from a data loss incident takes time. For less prepared businesses, it can take days or even weeks, depending on the incident.
DataCore.com states that only 2% of surveyed businesses recovered from their last downtime in less than hour.1
Continued in Part2 – 23 Business Disaster Statistics You Need To Know – Part2