SMBs in the Dark on Power Outage Protection

By Lauren Simonds | Posted August 27, 2008

If it weren’t for Ben Franklin, his kite and a dark and stormy night, business as we know it would not exist. You know it's important to protect and backup your data ‑ the very lifeblood of your business. But electricity is your data's lifeblood, and if the power fails and you don't have a plan in place, it's lights out for your bottom line.

Here's the thing; if your business isn't prepared for a power failure you're not alone. Emerson Network Power (ENP), a self-described "global leader in enabling Business-Critical Continuity," recently commissioned an online survey of 451 small business owners to find whether they were equipped to deal with a power disruption.

Matt Kightlinger, director of solutions marketing, said that the survey produced several key findings, and it also helped them better understand what small businesses need. "Only 39 percent of small business have backup power systems, which means 61 percent do not," Kightlinger said. That's a majority of small companies unable to keep the lights on, the computers and cash registers running or their employees working during a power failure.

The survey showed that 79 percent of the respondents had at least one power failure during 2007 while 29 percent (one in four) had thee or more, and that 42 percent of those companies had to close their business during the outage.

ENP contends that power failure-related downtime affecting even a small portion of SMBs could have a significant impact on the overall economy. According to Steve Strauss, author of The Small Business Bible, small businesses make up more than 99 percent of all business in the U.S., and they generate 45 percent of the American payroll.

"The U.S. Department of Energy estimates that on average, power outages cost $80 billion per year, and that 98 percent of those losses coming from the business sector," said Kightlinger. "With that in mind, sixty-seven percent of small businesses will experience another outage in the next 12 months."

Give that economic reality, making sure you have power backup to keep your servers, computers, and other critical systems running is a vital part of a business-continuity plan. According to the survey results, 62 percent of small businesses that have a continuity plan have back-up power supplies, and only 29 percent of small businesses without such a plan have back-up power.

Other survey findings include:

  • Fifty-six percent of the respondents believe that back-up power systems could give them a competitive advantage
  • More than one-third (38 percent) of those surveyed who experienced outages in 2007 said more of them occurred in the summer months
  • Twenty-four percent of respondents experienced more outages in the winter.

American perceptions produced an interesting result. A majority of those asked (54 percent) believe that U.S. businesses have fewer (or at least as many) power outages as other developed countries. However, that perception is incorrect.

Figures from the Electric Power Research Institute (EPRI) show that within the U.S., the average power company customer loses power for 214 minutes every year. By comparison, here's how other countries stack up:

  • United Kingdom: 70 minutes per year
  • France: 53 minutes per year
  • Japan: six minutes per year

And, in Japan, the average customer loses power once every 20 years. In the U.S., it's once every nine months.

Kightlinger said that it's a matter of making small business owners aware of the power supply issue. He recommends that business owners talk to local resellers who can advise them on the types of solutions appropriate for their business IT infrastructure needs. A reseller can help assess your needs and determine what's mission-critical.

"This goes beyond the power strip you buy at Wal-Mart. Make power back up part of your contingency plan. Know what's critical and what's not so you can protect what you need to stay in business," Kightlinger said. "You might not need to worry about a workstation, but you want to protect a server or phone system."

The cost will, of course, vary depending on your company's specific needs, but Kightlinger estimates the cost to be about 10 percent of what you spent on your IT equipment. "It costs a lot less than what losing your data would cost you," he said. "It's almost like buying insurance."

If you're curious about your vulnerability level, Emerson Network Power offers a small business resource where you can use an online tool to measure the impact a power outage would have on your company.

Lauren Simonds is the managing editor of SmallBusinessComputing.com

Do you have a comment or question about this article or other small business topics in general? Speak out in the SmallBusinessComputing.com Forums. Join the discussion today!


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