Business Resiliency: How to Build a Business Resilience Plan

If there was one overriding lesson for business owners over the past few years, it was to prepare for the unexpected. Staying ready to weather economic disruption and take advantage of new opportunities is not only the key to survival, but also a way to help your business thrive.

“We’re seeing an increase in the frequency and severity of unplanned events like cyber attacks and severe weather,” says Rochelle Clarke, founder of Continuity Strength, a provider of a digital risk management solution for small businesses. “Successful businesses make risk mitigation a core part of their business strategy so they’re ready for anything.”

Many small business owners recognize the importance of being prepared for the unexpected. In fact, though concerns about a potential recession were down according to respondents to the 2024 Bank of America Business Owner Report, uncertainty around broader macroeconomic factors such as the U.S. political environment, inflation and healthcare costs is tempering plans by small business owners in regards to expanding their businesses, hiring employees and obtaining funding.

How to build resilience into your business

Being ready, willing and able to adapt to change can give your business staying power. Beyond that, being flexible can help you seize new opportunities when others dry up. Here are some ways to stay nimble.

Prepare for an emergency

Make sure you’ve covered the basics of keeping your operations up and running if there’s a sudden emergency. Create a list of emergency contacts as well as a list of bank accounts and individuals who have signatory rights, so you’ll be prepared in the event you’re unable to run the business.

Also, draft a communications plan that covers how to get in touch with key stakeholders and a plan for handling your operations, including the technological aspects. “Having a business continuity plan lets you protect your operations, manage the unpredictable and avoid insurance premium increases resulting from filing a business interruption claim,” says Clarke.

Be ready to pivot

It’s important to consider workarounds if the current way you’re doing business no longer works as well as it once did. For instance, 71% of small business owners have digitally optimized their business over the past 12 months, with 37% of those bolstering their social media presence, 45% accepting more forms of cashless payments, and 21% adding cybersecurity measures, according to the 2024 Bank of America Business Owner Report.

Other ways to adapt include selling your product or service to new types of customers, expanding into new markets, introducing a new product or service to reflect current market demands, implementing customer engagement tactics or creating a digital version of one of your in-person offerings. (Get a more detailed look at ways to grow your business.)

Set frequently trackable goals

Staying on top of your business’s performance regularly can help you avoid unwelcome surprises. One way to do this is by setting trackable goals on a weekly, monthly, quarterly and annual basis — and course-correcting quickly if you’re falling behind. It’s also important to set aside regular time for innovation, whether it’s by testing new marketing approaches or new product development.

How to determine where you need to build more resilience

Every business is different. Doing a SWOT (strengths, weaknesses, opportunities and threats) analysis, using our editable worksheet, can help you identify key areas where your business may benefit from building more resilience.

Many businesses find there are opportunities for improvement in these seven areas:

Financing: Ask yourself regularly if you would be able to seek financing successfully and on short notice. How creditworthy is the business at present? If you don't like the answers to those questions, work on improving your cash flow and credit score. You never know when you may need funds.

In the year ahead, 71% of business owners plan to obtain funding for their business. Of those, 61% plan to use business credit cards. Another 45% will use personal savings, 28% will turn to personal credit cards, and 25% will opt for traditional bank loans, according to the 2024 Bank of America Business Owner Report.

Also, be sure to build an emergency fund. Make a list of your monthly expenses like payroll, rent and taxes, and multiply that amount by three. That is the number of months of overhead you’ll ideally want to have tucked away for a rainy day. If you’ve already opened an emergency fund, make sure to contribute to it regularly.
Marketing and branding: If your business is heavily dependent on in-person sales, consider diversifying into digital and mobile sales channels. Similarly, if you were to lose all of your sales during an internet outage or if there were a change in the terms of service on a platform you rely on, like Amazon, you need to have backup systems in place.

Making sure you are protecting your brand and other intellectual property is also important in an increasingly digital era. An appointment with your attorney to make sure you’ve covered your bases can be a great investment in the future of your business.
Product or service: With more people using social media, customers can post complaints online with the click of a button. Make sure you have systems in place to get input from your customers on your offerings before that happens, whether it’s a suggestion box at your point of sale or an organized way to log input from your front-line employees.
Talent: Staffing can easily become a source of grief for employers who aren’t making a concerted effort to attract and retain talent. About 3.3 million people quit their jobs in March 2024 alone, according to the U.S. Bureau of Labor Statistics. And among small business owners surveyed, 44% listed hiring challenges as a top concern, the 2024 Bank of America Business Owner Report found.

Even if you haven’t been hit yet, make no assumptions. Working harder to keep a healthy pipeline of employees and hold on to your team can go a long way. Also look for new avenues to recruit people, whether it’s on social media or through a trade organization or alumni network you belong to.
Operations: In today’s business environment, staying prepared for supply chain disruptions is mission-critical. Search on an ongoing basis for alternate suppliers, shippers, and others who perform critical tasks for your business. It’s better to find them before you need them than to search desperately and make last-minute decisions. And if you have the means, stock up on essential supplies you need to conduct your business to give yourself breathing room if things go awry.
Market: If your business depends heavily on sales in your local market, consider expanding into new markets. For instance, a local retailer could start an e-commerce store and reach new markets by running advertisements on social media.
Environment: Every business should be prepared for local situations such as a hurricane or storm that causes power outages or knocks out the internet. If you run a brick-and-mortar business, also be sure you have plans in place to keep your operations running if you experience flooding or another weather-related disaster.

How key advisors can help you identify areas for improvement

When you’re dealing with complex and fast-changing challenges, you may not know what you don’t know. Your banker, accountant and attorney can be valuable members of your advisory team and help you spot solutions and alternatives that aren’t on your radar.

How to build a business culture that fosters resilience

In addition to your advisory team, your employees can help you keep your finger on the pulse of emerging challenges in your business, so you aren't surprised later. Holding daily or weekly “huddles” and regular town halls can help you keep the lines of communication open and strengthen bonds.

Ultimately, no business owner can do it all alone. By unlocking the potential of your team and making the best possible use of the resources you already have, you can position your business to keep growing no matter what the economy does.

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Building a more resilient business