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Small businesses, big disasters

By Virginia Bridges
vbridges@newsobserver.com

More Information

  • Health insurance and small businesses

    Eighty-two percent of uninsured small-business owners don’t have health insurance because of the cost, according to a recent My Business, My Health survey conducted by Cigna, a global health service company. Here are other findings from the report:

    •  24 percent of small-business owners respondents don’t have health insurance.

    •  60 percent of uninsured, self-employed owners place business priorities over personal health and overall wellness.

    •  More than 33 percent respondents said one month away from work would result in either a loss of customers or going out of business.

    Cigna: My Business, My Health survey



The KoKyu relief crew arrived at about 7 p.m. on the Friday night of the April Shakori Hills GrassRoots Festival of Music & Dance in Silk Hope. That meant that David “Flip” Filippini, owner of the popular Durham food truck, could call it a night and have a beer.

“I walked out in front of the truck and I noticed there was some mud and I went to go grab some mulch so nobody would slip and fall,” said Filippini, 32. “As I am going to get the mulch, I slip myself.”

One foot slipped. The other gave way as he attempted to catch himself.

Filippini heard his ankle crunch, and knew it was broken before he hit the ground.

When Filippini left in an ambulance, his wife Sarah stayed with the food truck.

What came next was a blurry journey of hospital stays, doctor visits and a surgery in which a titanium rod was inserted from his knee to his ankle.

Filippini wouldn’t be able to step onto his truck – or the second one he planned to roll out after the April festival – for months.

Failing to plan for such situations is a common small-business mistake, said Nanci Appleman-Vassil, president and chief learning officer for APLS Group, a Raleigh training and consulting firm.

Prolonged illnesses and injuries could and do result in loss of revenue or even the entire business, local consultants said, and a lack of planning and insurance leaves owners, their employees and their family vulnerable.

“This can happen,” said Ann Close, managing member and senior human resources coach for Close HR Connections in Raleigh. “Don’t just think about yourself, but think about everyone it impacts.”

Plan ‘what-if scenarios’

The tools available to small-business owners include well-trained employees, insurance options and – for the smallest firms – a network of professional peers who are readily available to subcontract.

Small-business owners can start their risk-management planning with “what if scenarios,” Appleman-Vassil said, such as ‘What if the sole proprietor falls and can’t get up for a month?’ or ‘What if the baker gets a contagious illness and can’t come in for a week?’

Owners need to dole out their responsibilities and start training employees now, Appleman-Vassil said. Owners might also consider turning to trusted colleagues outside of their firm.

Appleman-Vassil, who teaches a class on small-business mistakes at the Wake Tech Small Business Center, knows firsthand about facing unexpected injuries.

In December 2009, Appleman-Vassil slipped while walking her dog on a rainy day. An ankle surgery left her immobilized for close to three months.

Appleman-Vassil turned to an established network of professionals who share her values and work ethic, she said

“I used other consultants,” she said. “I subcontracted them out to take care of the customers I had.”

In such situations, small business owners should utilize a contract or a letter of agreement, Appleman-Vassil said.

“It is something that puts it in writing because some of us will remember what we talked about and some of us will not,” she said.

In 2009, Jeanne Frazer, president of vitalink, a Raleigh advertising agency and marketing firm, learned she had follicular lymphoma, a slow-growing, Non-Hodgkin type of cancer.

Frazer prepared for her first round of monthly treatments by setting up a succession plan, doling out duties and getting as much work as possible done before she left.

Before each treatment, Frazer met with her three employees, told them what she was responsible for and what she might not be able to get done.

“It’s amazing what you find out about how people can cover for you,” said Frazer, who was cancer-free after five months of treatment.

David Washington, managing partner of Washington & Co., a Raleigh consultation and training firm, likened planning for an unexpected injury to planning for a vacation.

Small-business owners need to set ground rules for personnel, assign responsibilities and define when they need to be involved.

“A lot of time, people don’t understand what constitutes an emergency,” Washington said. “They could be constantly calling you about things that aren’t mission critical.”

Examine insurance options

Disability insurance provides income protection for a policy holder in the event that they can’t work for a long period of time. Business overhead expense policies cover related businesses expenses such as rent.

Each policy is unique and based on the level of protection the small business desires and the amount of money the owner wants to spend.

Jerry Jones, chairman and CEO of Jones Insurance in Garner, said while there are various insurance options available, many small business owners think they can’t afford such services.

“(Disability) is one of the most under-purchased forms of insurance that I know of,” he said.

The premiums vary, Jones said, based on variables such as occupation, the amount of wages the policy covers, and the payment waiting period.

At first, Filippini, who doesn’t expect to be back on the KoKyu truck until at least August, worried whether the truck would be able to last without him.

Before the accident, Filippini was working more than 100 hours a week prepping food and dealing with paperwork and inventory at his Research Triangle Park commissary during the day and managing the truck at night.

“It is just a routine,” he said.

After Filippini’s surgery, he held a meeting with his six employees and divvied up his responsibilities, but he links the seamless transition to a thorough employee training process.

“The injury has opened my eyes a lot to being able to kind of let go a little bit more because they have done such a good job with it,” said Filippini, who is keeping busy by placing orders and doing inventory. “At this point, they absolutely are running it without me.”

Bridges: 919-829-8917
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