Small and medium-sized businesses are surprisingly vulnerable to extreme weather conditions, new research from The Open University Business School suggests.
More than a quarter of smaller businesses surveyed said extreme weather conditions have posed a real threat to them over the last five years.
Strikingly, the survey was carried out in October and November 2013, before the recent spate of storms and flooding.
The finding has been taken up by campaigners who want to see new affordable flood insurance extended to cover small and medium-sized businesses, which are currently excluded from the Government-negotiated scheme.
The extreme weather data appears in the latest Quarterly Survey of Small Business in Britain, an independent report produced by The Open University Business School, which monitors the performance and opinions of the small and medium-sized business sector.
The latest survey, which focuses on resilience and recovery, looks at how small business owners and managers prepare for external shocks, and how they cope with the immediate impact and in the longer-term.
Linked to the survey are insights into the most extreme examples of small business survival, Britain's oldest family businesses, which have survived for 300 years or more.
The survey finds that the credit crunch and unstable market conditions are still the biggest external threats for small firms, but extreme weather is next in importance.
It impacts on businesses in a multitude of ways, from direct damage due to floodwater or storms, to blocked roads hampering transport of goods, supplies and staff, power failures and customers staying away.
Smaller firms cane be more vulnerable to external shocks such as extreme weather because they have limited resources and can't spread their risks across multiple products or markets like larger firms.
But with fewer formalised procedures, small firms can also be more flexible in response to changing situations.
The good news is that a substantial minority of small businesses (40 percent) think they have become stronger as a result of an external shock.
And for businesses less than five years old, 60 percent say they have become stronger after a crisis – supporting research which suggests that firms founded in tough times are more resilient than those founded in a more settled environment.
Learning from the survivors
What does it take for small businesses to survive? What can today's businesses learn from the long-term term survivors? The authors of the Quarterly Survey have brought together some leading academics to identify factors that can contribute to business resilience and recovery, on The Open University's OpenLearn website. The resources are linked to the Open University/BBC series Hidden Histories: Britain's oldest family businesses, first broadcast on BBC Four in January.
Small businesses and The Open University Business School
The Quarterly Survey of Small Business in Britain is a long-established and influential survey of small business performance, conducted by The Open University Business School using information supplied by more than1000 business owners and managers. To download a copy of the current or a previous survey, or become a participant, go to the survey website.
