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Monday, June 26, 2017

Avoiding Catastrophic Failure In Your Absence

It seems like only yestermonth that I observed how badly I needed a vacation, and I finally took one last week, driving with the family out to the balmy climes of Anaheim for a day of merriment at Disneyland California Adventure.  The girls had been to the main Disneyland Park five years ago, and Greggles had never been, so we chose the alternate and enjoyed a day of Radiator Springs Racers, California Screamin', Ariel's Undersea Aquarium, and the rest.

As I predicted in that earlier article, having Griffin on hand to cover eventualities worked perfectly; he was available to write checks for overlimit buys where the seller didn't have PayPal, and he ended up not having to do so.  He was available in case of critical customer service failure, and we had none.  No physical plant problems came up, no serious supply outages occurred, and only two special orders failed to get put in, and I got that done when I returned.  Our two store managers, Chris and Jake, largely had continuity handled, and my online store manager, Tanner, proceeded virtually unchanged from a normal work week.  The main thing is to make sure the managers and staff know the fallback plans, even if they are not invoked.  Confidence that you know what you're doing goes a long way toward ensuring strong execution.

Business continuity is a dry subject that most store owners don't want to spend any time on.  I love dry subjects that everyone hates, so here we go.

Internet outages
Every store uses internet connectivity for at least its credit card processing, and often uses it for all TCG pricing on both purchases and sales.  An instance of the internet going down is no joke.  There must always be a backup plan other than "stop making money."  Fortunately, mobile hotspots are available from a variety of carriers, and depending on the store's scale, it may justify having its own service for these.

Credit card processor outages
There is no real excuse for this in a world where both Square and PayPal Here exist.  Whichever one is down, use the other.  I used to use Chase Paymentech until I learned that their chargeback protection was awful.  I had iPayment for a while and the service is both good and cheap, but you are forced to use antiquated equipment, basically the cheapest possible Ingenico chip readers.  That is my in-store backup system now, relegating the PayPal Here chip reader to third place.  Fortunately, it can use the same iPads as our Square terminals.

Water outages
There's no real answer to this one other than closing the restrooms until your municipal water provider gives the all-clear, but be prepared to do so and have a process in place so your employees know how to do it when an owner is not there.

Power outages
There's not much you can do about this and for about ten months out of the year there is not anything my stores can do about it, due to the desert climate.  If the power goes out for more than a few minutes, the store must close.  Have a process in place for your crew to know the drill.

Crime situations
Fortunately, most people understand how to call the police, and you should impress upon your staff that you approve of them doing this.  Have the local police general response line posted where your staff can see it.  You don't want them calling 9-1-1 unless there is an actual life-threatening emergency.  This will require your followup when you get back, but a competent manager can generally interact as needed with the police in situations like this, and will get better as more such occurrences take place.

Staff mutiny/Store fire/Building safety incident/Natural disaster/etc
Tell your staff to close on up until you get back.  There are things you simply can't have them handle without you.  But these should be outlier events that don't happen often, perhaps ever.  And you should have insurance that covers employee misconduct, not that you hope ever to need it.

Those are some examples of things that threaten your ability to keep doing business.  There are other issues that can keep you from doing business well.  Those also need to be addressed.

Cash shortages
Prepare before you leave so that someone in your stead can run to the bank or else there is enough currency in your safe to continue normal operations.  This is especially critical if you do a lot of buying from the public.

Staff no-shows
This generally falls within your manager's purview.  If you don't have a manager separate from yourself, you probably aren't taking a vacation yet.  Or if you are, you don't really have business continuity independent of yourself.  This is also an empowering authority for your manager, because it is a very simple issue, very well understood in any industry, and gives your manager a chance to follow the disciplinary process you wrote into your employee manual, sharpening his or her management chops.  You did write an employee manual, didn't you?

Supply outages
Staples charges like eight times more than U-Line for toner drums or receipt paper rolls, so take care of your supply situation as best you can while you are still in town, and if you end up out of a mission-critical supply, just accept that your manager will have to take cash from the safe, go to the store, buy the thing at a not-good price, and leave the receipt for you, your administrator, or your accountant to add to the regret ledger.  Live and learn.

Credit card interruptions
You're on vacation on the Island of Saint-Marie, 3270 miles away from your store, and your manager messages you that he can't charge postage to your store AMEX because it was flagged as stolen after being swiped a bunch of times... on the Island of Saint-Marie, 3270 miles away from your store.  You check your wallet... and your store AMEX isn't there.  Uh-oh.  Or even if it is there because it's your own AMEX you happen to use for the business, not recommended but many stores still do this, and it was flagged as a security precaution, you still have a problem.  This is one of those situations where you need a multi-pronged continuity plan in place.  Your store should have multiple credit card options even if you don't use them all, and separate accounts for the business and your personal use are a must in any case.  When I fly somewhere I don't even take my keys with me.  For the store, prepare cash, PayPal, checks, and if possible even alternate means of paying for business operations in your stead.  For example, we can ship from eBay, from Crystal Commerce (Endicia Postage), from PayPal Ship Now, or at the end of it all someone can go to the post office and get that parcel out on time.  Most of your distributors should be getting paid by ACH, so as long as you have a way of managing your banking remotely, that should hopefully suffice.  Have a backup for your backups and a way to put any funds where you need them, and make sure you contact your credit card issuer before traveling.

Overlimit buys
This won't apply to all of you, but if your attorney checks into it, it may apply to more of you than you think.  My municipality limits cash buy totals before triggering pawn sequestraton and reporting requirements, and many other localities have similar "know your customer"-style laws, regulations, or ordinances.  In my case, paying with an audit trail (business check or PayPal) can be done without limit.  Without a limit other than your available balance, obviously, which if you leave town you want to make sure is as high as possible.  My staff knows they can always dip into PayPal for an overlimit buy, and I make sure another owner is available in case a check is the only way to proceed.  I want those buys.  Buys are crucial to running a healthy business.  My staff knows they are at liberty to spend every dime on the premises if we are getting the right merch for the right price.  We just have to follow the legal requirements.

Product outages
Ours is an industry with stockouts every day, but there are outages (K-Wings, which nobody can get right now), and there are outages (the store ran out of Amonkhet boosters).  Planning ahead should stave off all but the most unexpected of these situations.  You do not turn away the customer with cash in hand who wants to buy you out of matte black Dragon Shields.  But it is an economic reality that stores cannot always stock ultra-deep on everything.  Have a plan ready.  In my case, my staff uses a shared cloud notes app to jot down anything we need ordered, and any critical orders in detail. My manager has the authority to put in orders from some of my suppliers, and they check with me before firing off, but even that might be more protection than we need.  In a pinch, another owner could also do this.  End of the day if your plan is simply that your vacation gets interrupted for the length of a phone call or email to your distributor rep, and they send the goods.  If it's Friday morning and you just ran out of Magic boosters going into the weekend, congratulations, you suck.

Obviously, the foregoing is not a comprehensive list of issues that can interrupt business continuity or impede business effectiveness, but it should serve as an ideal primer and something that every owner can look at and be sure they've covered.

I am far from perfect, and in no way should this article be construed as braggadocio.  At one point or another, I have learned the lesson of most of these problems the hard way.  You'll end up doing the same at least once or twice, and hopefully your business survives to open another day without such problems.  Fool me once, shame on you.  Fool me twice, won't get fooled again.

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