The True Impact of Wildfires on Business

By July 30, 2019 September 17th, 2019 Emergency Management
impact of wildfires on business

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

The Devastation of Wildfires

During hot, dry summer months, there’s 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 discarded cigarette, or a campfire; a single spark can quickly erupt into a massive wildfire that causes irreparable damage.

According to the National Oceanic and Atmospheric Administration (NOAA), during the first half of 2019 the U.S. experienced an average of 3,603 wildfires per month. In June alone, there were 5,657 fires—the 5th most on record for a single month.

In 2018, the annual impact of wildfires was catastrophic, burning 8,582,609 acres of land—an average of 153.5 acres per fire (the 2nd highest on record).

Fighting these fires consumes massive amounts of resources. Reuters reported that the deadly wildfire in northern California ended up as the single most expensive natural disaster in 2018. Wildfires cause widespread damage, destroying land, buildings, homes, transportation routes, wildlife, and agriculture. Even worse, they end up injuring and taking the lives of 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. Organizations 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 widespread—virtually anyone, anywhere, can start a fire at any time
  • Wildfires can occur all over the world and in nearly all 50 U.S. states. While they are more prevalent in the southwest, no region of the country is exempt from the threat

The fact that wildfires can pop up with little warning 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 accordingly. 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 often 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 organizations:

The northern California Camp Fire, which destroyed more than 7,300 properties had a direct impact on numerous businesses in the region. Communication became essential to ensuring employee safety and sending out alternate work information.

Direct Impacts

  • Property: Businesses with buildings in the path of a wildfire will obviously be impacted. But even if a company doesn’t own property, if it has a physical location it will be disrupted when evacuating or modifying 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 an organization’s physical location is not at risk, some of their employees (who usually live dispersed around a region) might be. If certain neighborhoods are threatened, damaged, or evacuated, a business could temporarily lose a good portion of its workforce.

A wildfire can also disrupt or even shut down a business. Even if the company recovers, its customer base may not. An organization 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.

There are also far-reaching consequences to a wildfire. In the weeks following the 2017 Sonoma fire, California’s outbound shipments took a major hit—including an Amazon fulfillment center being shut down near Sacramento. The freight and transportation industry in the region was brought to a halt, which ultimately created a ripple effect felt across the country.

Indirect Impacts

  • Labor Market: Wildfires will disrupt the labor market, which will have an impact on businesses. When employees 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 pose a risk to 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 and wood/production costs to transportation costs. These extra expenses 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 company.

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 reaching your business, you can take precautions by assessing how a wildfire could impact your organization. Having a centralized emergency communication solution at your fingertips is the best way to keep your employees safe and informed.

Communication during wildfire season is challenging if you don’t have the right tools in place. 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.

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