It was September 11th, and my plane landed early in Houston for a business trip. The flight was a little ahead of schedule, and the airport seemed unusually slow. "Well, Houston isn't really a hub," I thought, as I walked out into a deserted waiting room. Every airport employee was crowded around a TV, watching a skyscraper in flames.
"Oh, a skyscraper fire," I thought. "I hope everyone will be okay."
Little did I know, the world had just changed.
The taxi line was empty, and I quickly hopped into a cab. The driver turned to me, puzzled. “What city were you trying to get to?” he asked. Confused, I replied, “Houston. I’m in Houston.” His eyes widened.
“Oh, you haven’t heard. Planes are flying into the World Trade Center. All flights were grounded. You’re lucky you made it.”
That day, I learned what it truly meant to be blindsided in business. At the time, I was deep into a startup, $43 million into funding, gaining traction, and making headway with national brands. New York was our largest market—and overnight, it went silent. For six months, there was no business from New York. That week, we didn’t even know if our employees there had survived (thankfully, they had).
But 9/11 wasn’t the only time my business was blindsided. Fast forward eight years, I was with another company selling RFID equipment to hotels and casinos. We were on the brink of a massive rollout that would more than double our revenue. Then the Great Recession hit. Hospitality tanked—occupancy rates plummeted, and capital spending froze. Deals we’d worked on for months were suddenly “indefinitely on hold.” Only Indian Gaming Casinos kept us afloat—a fluke since they weren’t even our target market.
Oh, and then in 2020 there was this little "thing" called a global pandemic. That's all so fresh I won't reopen those wounds.
How to Prepare for the Unexpected
Whether it’s terrorism, economic downturns, or natural disasters, business surprises are inevitable. You can’t predict them, but you can prepare. Here’s how:
1. Build a Financial Safety Net
- Why it matters: When revenue dries up, cash is king.
- How to do it: Create a “D-Day Fund” with enough reserves or untapped credit lines to cover months of operational expenses. Treat this as untouchable—until it’s not.
2. Get Comprehensive Insurance
- Why it matters: Disruptions like fires or lawsuits can derail your cash flow.
- How to do it: Beyond liability and workers’ comp, explore business disruption insurance, property insurance, and coverage tailored to your industry.
3. Diversify Your Revenue Streams
- Why it matters: Too much dependency on a single market or client is risky.
- How to do it: Spread your focus across geographies, industries, and client bases to minimize exposure to specific downturns.
4. Have a Downturn Plan
- Why it matters: Decisions made in panic rarely turn out well.
- How to do it: Work with your team to create a contingency plan:
- Identify financial triggers for cost-cutting.
- Prioritize personnel and vendor payments.
- Make workforce reductions swiftly and decisively.
Final Thoughts
Disruptions are inevitable, but they don’t have to destroy your business. With preparation, you can withstand the unexpected and emerge stronger.
Because let’s face it: it’s not a matter of if you’ll be blindsided—it’s when. Will you be ready?