The True Impact of Wildfires on Business

impact of wildfires on business

Wildfire season is here and businesses have a lot at stake. The far-reaching impact of wildfires on business is astounding, but there are proactive steps a company can take.

The Devastation of Wildfires

In the hot, dry summer months, people have more to worry about than a sunburn. Wildfires can break out at any moment, putting homes and businesses at risk. Whether from a lightning strike, a fallen electrical pole, a cigarette, or a campfire; a single spark can quickly turn into a massive wildfire that can cause irreparable damage.

According to NOAA, in 2017 the U.S. experienced 66,131 fires, the seventh most wildfires on record. The impact of these fires was catastrophic, burning 9,781,062 acres of land, the third-most ever recorded. This averaged 147.0 acres per fire.

Fighting these fires consumes massive amounts of resources. Reuters reported the 2017 U.S. wildfire season cost more than $2 billion in efforts alone, but that didn’t include the total cost of the 2017 California wildfires which topped $180 billion. The fires caused widespread damage, destroying land, buildings, homes, transportation routes, wildlife, and agriculture, not to mention killing and injuring many people.

Wildfires vs. Other Natural Disasters

Wildfires have a unique profile compared to other natural disasters, such as hurricanes and tornadoes.

This means, for businesses, it’s not business as usual. Businesses need to treat the threat of wildfire much differently than they do other natural disasters.

  • A wildfire can last for weeks or even months
  • Wildfires can come with little to no warning
  • Unlike other natural disasters, people can start wildfires. This means the potential risk is uncontrollable – virtually anyone can start a fire anywhere at any time.

The fact that a wildfire can pop up almost anywhere makes it challenging for businesses to take preemptive steps. When people live on the coastline, they understand there will eventually be a hurricane and prepare appropriately. Those living in “Tornado Alley” realize they have a higher than average chance to experience a tornado and therefore invest in tornado shelters.

Unfortunately, there isn’t much that can be done to protect a home or business from a fast-moving wildfire. Beyond taking general precautions, such as clearing brush and trimming trees near structures, businesses are vulnerable to the wrath of wildfires. Evacuation is the only option.

Related: Communication Challenges during Wildfire Season

Wildfire Impacts on Businesses

Business owners feel helpless watching a wildfire encroach on their livelihood. They know what’s at stake. As wildfires rage, there are both direct and indirect effects on businesses:

Direct Impacts

  • Property: Businesses with buildings in the path of a wildfire will obviously be impacted. But even if a business doesn’t own property, if it has a physical location it will be disrupted if it has to evacuate or modify work hours due to wildfire.
  • Equipment: Any equipment located in the vicinity of a wildfire will be at risk. Your business will need to protect or evacuate this equipment.
  • Assets: Certain industries, such as agriculture, ranching, real estate, and forestry may have their entire livelihood threatened by wildfires.
  • People: Even if a business’s physical location is not at risk, some of their employees (who usually live dispersed around a region) may be. If certain neighborhoods are threatened, damaged, or evacuated, a business could temporarily lose a good portion of its workforce.

There is the immediate threat of damage to property, equipment, assets, and people. But a wildfire can also disrupt or even shut down a business. Even if the company recovers, its customer base may not. They can lose customers if the area is highly damaged or perceived to be damaged. If the business had to close for a period of time, customers may have found alternate companies to fill the void.

Indirect Impacts

  • Labor Market: Wildfires will disrupt the labor market, which will have an indirect impact on businesses. When people are dealing with the aftermath of a wildfire, they may skip work, take leaves of absence, or use sick days to tend to their families and neighbors. They may even move out of the area altogether to start fresh.
  • Transportation: Wildfires often make traveling in hard-hit areas difficult, shutting down roads and other transportation routes, such as railways. Companies who rely on these roads for employee travel or transporting goods have to be patient while crews work to clear those areas from debris. Emergency and recovery vehicles may take over these routes for some time.
  • Utilities. Even if a wildfire doesn’t threaten a power plant or sewage facility, it could threaten the infrastructure supporting these utilities. Until crews can repair the damaged lines, many companies cannot operate, much less generate revenue to pay the bills.

All of these factors often lead to an increase in a variety of prices that trickle down to the consumer, from labor to wood and production costs to transportation costs. These extra costs can be difficult to absorb for most businesses. Without proper reserves, a single wildfire has the potential to wipe out even the most well-established business.

Minimize The Impact Of Wildfires On Your Business

Whether your business is in a wildfire-prone area or relies on vendors, suppliers, or customers who are, every wildfire should be perceived as a threat to business continuity and operations. While there isn’t much you can do to stop a wildfire from impacting your business, you can take precautions by assessing how a wildfire could impact your organization and having a centralized emergency communication solution at your fingertips to keep your employees informed. Communication during wildfire season is tough if you don’t have the right tools. Take steps to make your business as resilient as possible if a wildfire threatens you, your supply chain, your customers, or your employees.

 

Looking for help on crafting communications for your business? We’ve created a set of templates that will help you craft messaging for all phases of a wildfire. Click this button to download now!

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