How Can Climate Change Impact a Small Business?

Global climate change has certainly been a controversial topic over the last several years, but the vast majority of scientists now agree that it’s happening whether people like it or not. That might lead many to wonder how it’s going to impact their daily lives in 10, 20, or 30 years, and this may be a particularly worrisome issue for small business owners.

In the last few years alone, extreme weather in various parts of the country has created havoc for small businesses, according to a report from the Detroit Free Press. Extreme weather in the Northeast the last two winters has led to billions in lost sales across the region, and slowed the local economies to a crawl. Meanwhile, the impact of Hurricane Sandy is still being felt to this day in some parts of the Tri-State area, as recovery efforts still haven’t been completed for a litany of reasons.

Small businesses at greater risk?
As a result of these issues, about 1 in 5 small businesses across the country have had to lay off some workers in recent years as a direct result of the adverse business conditions brought on by difficult weather, the report said. Because many operate on relatively thin margins overall, these companies are far more likely to be substantially weakened by a week or two of minimal business.

“Small firms are much more vulnerable to loss from extreme weather events than larger businesses with backup resources at multiple facilities, which is why they’re becoming increasingly concerned about this issue,” said U.S. Green Business Council national students chair Anthony Offak, whose organization is hosting a summit in Detroit to discuss the impact, according to the newspaper. “This event will provide a ton of great information on new business-friendly policies that are taking aim at climate change and extreme weather, and at the same time, cover ways for small businesses to save money now by becoming more energy efficient.”

Owners who can do more to understand the risks they face, and what they might be able to do in the face of these issues going forward, are likely to have more success. For instance, if they can find better and more affordable small business insurance – including plans for errors and omissions insurance – they might actually be able to save thousands of dollars annually.