When Hurricane Helene made landfall nearly two years ago, manufacturers in inland North Carolina lost water and power as well as access to passable roads for weeks. Some of those businesses never reopened. The lesson was not new, but it was clear: a storm does not have to hit your facility to shut down your business.
Despite examples like this as well as the significant volatility that manufacturers and wholesale distributors continue to experience, most do not have a formal business continuity plan in place. Some assume their insurance coverage is sufficient. Others believe that a disaster plan is something only large companies need. Neither assumption holds up in the aftermath of a major disruption.
The businesses that weather disruption best are those that planned for it before it arrived. The following outlines why business continuity planning matters for manufacturers and distributors and what a strong plan must include.
Unique Risks in the Industry
Most businesses face some level of operational risk during a natural disaster, but manufacturers and distributors are particularly vulnerable for a few reasons.
- First, physical assets are central to operations. A manufacturer cannot ask its workforce to work from home when its equipment, raw materials, and production lines sit in a physical facility. A distributor without access to its warehouse cannot fulfill orders, regardless of the capabilities of its team. When a facility is damaged, flooded, or without power, the impact is immediate and measurable.
- Second, supply chains extend well beyond a business’s walls. A hurricane that disrupts a key port, damages a supplier’s facility, or closes major transportation corridors can bring production to a halt even when a manufacturer’s own building is untouched. Businesses with diversified supplier relationships are far better positioned to navigate these moments than those operating with a single source for critical materials.
- Third, customer commitments do not pause for disasters. Manufacturers and distributors operate under contractual obligations, delivery windows, and customer expectations that have little tolerance for delays. An inability to communicate a plan ,or worse have no plan at all, can permanently damage customer relationships at a time when the business is already under stress.
What a Business Continuity Plan Should Include
A business continuity plan is a living framework that helps leadership make decisions quickly and confidently when the unexpected occurs. For manufacturers and distributors, a strong plan addresses the following areas.
1. Risk Assessment and Business Impact Analysis
Before a plan can be written, a business must understand the causes of potential disruption. A risk assessment identifies the threats most likely to affect operations, in hurricane-prone regions, this includes flooding, wind damage, storm surge, and extended power outages. Weather events, though, are not the only risk. Cyber incidents, supply chain disruptions, equipment failure, or loss of a key employee are risks that can affect most businesses. A business impact analysis goes a step further, evaluating which functions are most critical, how long the business can sustain an interruption in each area, and what the financial and operational consequences of various disruption scenarios could be.
2. Facility Protection and Recovery Protocols
A plan must address how the physical facility will be protected and restored after a disaster. This includes procedures such as securing equipment, elevating critical assets in flood-prone areas, backing up data systems, and establishing clear shutdown checklists. It also includes protocols for assessing damage, engaging contractors, prioritizing repairs, and communicating timelines to customers and vendors.
3. Supply Chain Contingency Planning
Single-source suppliers are a business risk that disasters expose quickly. A continuity plan must identify critical suppliers, assess their geographic exposure and disaster preparedness, and, where possible, qualify alternative suppliers before they are needed. A vendor that is easy to find on a normal day becomes very difficult to find when everyone in an affected region is looking for the same solution at the same time. For distributors, this also means having a clear plan for inventory prioritization when supply is constrained, as well as identified logistics alternatives if primary transportation routes are unavailable. Depending on the industry, planning for events that may trigger a force majeure declaration can also be beneficial.
4. Technology and Data Recovery
Modern manufacturing and distribution operations depend heavily on technology; ERP systems, inventory management platforms, automated equipment, and customer order portals. A disruption that takes these systems offline, whether due to infrastructure failures or a cyber incident, does not just slow operations. It can make it impossible to know what was on hand, what was owed to customers, or what was outstanding with vendors. In some cases, disruption to these systems can destroy a plant’s ability to function and manufacture product.
A continuity plan must address how critical data is backed up, where it is stored, and how quickly systems can be restored. Cloud-based backups and off-site data storage are no longer optional. Many businesses discover their technology vulnerabilities only after a disruption; a continuity plan forces that conversation to happen before one.
5. Workforce and Communication Planning
Employees are a critical asset. A continuity plan must address how the business will communicate with its workforce before, during, and after a disaster, including how employees will receive safety information, how they will be notified about facility closures or reopening timelines, and what resources or support may be available to those whose homes or families have been affected.
The plan must also identify which roles are essential to recovery operations and ensure that more than one person is trained to perform each critical function. Key-person dependency, where only one individual knows how to operate a critical system or manage a specific customer relationship, is a vulnerability that disasters expose immediately and mercilessly.
Further, a strong continuity plan should also look beyond immediate disruptions and consider succession planning for key employees and critical organizational roles. This may include talent assessments, duties essential to the organization, or critical cross-training protocols. Sudden vacancies can cause severe disruption, reputational damage, and financial distress. Therefore, they are important to consider in order to promote organization longevity.
6. Customer and Vendor Communication Protocols
One of the most overlooked elements of business continuity planning is the communication plan. When a disruption occurs, customers and vendors need information quickly. A well-prepared business knows in advance who will communicate, what they will say, and through what channels. Having templates ready for customer notifications, vendor updates, and leadership communications saves valuable time when every hour matters.
Transparency during a disruption matters as much as the disruption itself. Customers who receive proactive, honest communication about delays and recovery timelines respond very differently than those who feel they are being kept in the dark, and those impressions often outlast the disruption itself. In some cases, media communication plans may also be prudent to ensure , consistent, accurate messaging to the public.
7. Insurance Review and Financial Preparedness
Where applicable, a business continuity plan must be developed in close coordination with a thorough review of the company’s insurance coverage. Property and casualty coverage, business interruption insurance, and supply chain disruption coverage all play a role in financial recovery, but the details of what is, and is not, covered vary significantly by policy. Business owners are routinely surprised to discover coverage gaps after a loss has already occurred, which is precisely the wrong time to find them.
Beyond insurance, leadership must evaluate the company’s access to liquidity in a disruption scenario. Lines of credit, cash reserves, and banking relationships that are established before a crisis are far easier to access than those pursued in the middle of one.
A Plan Is Only as Good as Its Practice
Writing a business continuity plan is a meaningful step forward. However, a plan that has never been tested is a plan of uncertain value. Businesses that take continuity planning seriously conduct periodic tabletop exercises, walking leadership and key employees through simulated disruption scenarios to identify gaps, clarify decision-making authority, and build the familiarity that allows teams to respond effectively under pressure.
For additional information or to discuss your business, please contact a member of HBK Manufacturing Solutions at 330-758-8613 or manufacturing@hbkcpa.com.
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