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Volume 27, Issue 3

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Small Businesses in OKC Area Struggle to Rebuild

When a disaster strikes an industrialized area, numerous small businesses with no contingency plans are often affected and must struggle to survive. For many businesses near the recent explosion site in Oklahoma City, Okla., this was the case.

More than 300 businesses in a 15-square-block area were damaged, with 14 condemned. Of those, many were small businesses.

These small businesses are often unprepared for a disaster. With few employees, there is usually no one designated to create a contingency plan, and with small budgets, there is often no money to fund a plan even if it's created.

Though this absence of contingency planning can also be found in larger companies, it is not as widespread. For example, many of the large businesses in the Oklahoma City area had recovery plans in effect which helped them stay in business following the bomb's explosion on April 19, 1995.

The Social Security Administration, which was housed in the Alfred P. Murrah Federal Building, was able to continue client's claims with no interruption, despite the fact that their business site was destroyed in the blast. Because of contingency planning, almost all information on Oklahoma's 100,000 social security clients is stored at a computer center on the East Coast. When the disaster occurred, workers in Dallas immediately reassigned the workload to other offices and calls were routed to other offices where they were handled by "specially briefed" staff members.

The only information which may have been lost was information that had not been entered into the computer, or documents like medical records submitted for claims. That information would have to be submitted again, officials said.

The Federal Employees Credit Union, housed in the federal building, also reopened quickly following the bombing. Within eight hours of the blast, officials of the credit union selected a new site, arranged for telephone and computer systems and retrieved account data which was stored off-site. They reopened in their new location on April 21, just two days after the blast. Volunteers and temporary workers staffed the business, since 18 of the credit union's 33 employees died in the explosion and five were hospitalized.

In addition, most area banks - which are required by law to have backup plans - were back to business as usual by Thursday, April 20. The blast caused temporary shutdown of most downtown banking activity, including key industry services provided by the Federal Reserve Bank. However, by Thursday, the Fed was operated by a skeleton crew and the doors were again opened at most downtown banks. Checks were processed at the office after they were delivered to a remote site. Though two downtown Bank of Oklahoma locations were damaged or inaccessible, employees from those two locations were reassigned to other areas.

The large businesses' fights for recovery were in no way easy, but, because of contingency planning, they were manageable. The story is very different for many of the smaller businesses around the blast site. Most did not have any type of recovery plan in place before the bombing.

“Large businesses tend to be more organized,” said Jim Atkins, public information officer with the Small Business Administration. He noted that in his six years with the SBA he has not seen any small business with any real disaster recovery plan.

As a result of the OKC bombing, 201 businesses in the downtown area have sought applications for assistance, said Mr. Atkins.

The applications are for two types of business loans offered by the SBA. Business Physical Disaster Loans are loans to businesses to repair or replace disaster damages to property owned by the business, including real estate, machinery and equipment, inventory and supplies. Businesses of any size are eligible. The Economic Injury Disaster Loans (EIDL) provide loans for working capital to small businesses and small agricultural cooperatives to assist them through the disaster recovery period. EIDL assistance is available only to applicants with no credit available elsewhere.

A small business is classified as such by comparing its recorded sales or number of employees against predetermined standards for each industrial field. For example, in the manufacturing field, a wire and cable manufacturer would be classified as a small businesses if its recorded sales or its number of employees matched those standards set for that field.

As of mid-May, Mr. Atkins said 68 applications for Physical Disaster Loans and 74 applications for Economic Injury Disaster Loans were returned to his office.

The filing deadline for applicants for physical damage was June 24, 1995, while those filing for economic injury have until January 26, 1996 to return their application.

Cecil Elliott, an employee of Hale Photography, said his business would be one of those needing assistance. The businesses' owner, Delores Hale, would determine whether the firm could stay open based upon how much assistance was available, said Mr. Elliott.

The photography shop, located at 622 N. Broadway Ave. - one block from the explosion - had some structural damage, but was able to reopen the day after the blast.

They were kept busy selling film and other photography supplies. But, Mr. Elliott said he felt the brisk business was temporary. The mainstay of their business - processing film - has been halted because of damage to the developers. Mr. Elliott also fears structural damage at the building could be worse than originally estimated.
Mr. Elliott said he did not know of any contingency plan in effect at the business. “You just don't think things like this will happen,” he said.

Some small businesses located outside the downtown area of Oklahoma City area also suffered affects of the bombing, even though they were not near the bomb site.

The Oklahoma City office of Trader Publishing Company, which publishes four magazines - Auto Trader, Truck Trader, Bargain Post, and Boat, Bike, and RV Trader, was unable to print some of its magazines after its printer's building was damaged in the blast. The Journal Record, located directly across the street from the Murrah Federal Building, was in the process of printing Auto Trader and Truck Trader when the bomb exploded.

“Our "boards" (blueprints) for the two magazines were inside the Journal Record building along with the finished books for Boat, Bike and RV magazine when the explosion occurred,” said Sandy Bale, office manager for Trader Publishing Company. “We do not have a "backup" copy of the boards in our office, so printing elsewhere could not occur until we were able to re-enter that building and retrieve the boards.”

The publishing company, which had no established contingency plan, needed to take steps immediately to recover their losses.

The firm first notified available commercial customers and inquiring private advertisers that the two magazines would not be available on their normal distribution day.

“We had to give all our advertisers in the Auto and Truck magazines credit for the week that we were unable to print,” said Bale. “Circulation and commercial revenue were down for the two books that didn't make it at all that week.”

Company officials next made arrangements for a Journal Record administrator to enter the damaged building and retrieve the "boards" for the two magazines. These were then sent to an alternate printer in Kansas for publication.

“The magazines were available by the following Monday,” said Bale.

Now that the immediate problem had been solved, company officials turned their attention to finding a long-term solution to their printing dilemma. It would be months before the Journal Record could resume business, so another printer had to be located. Because of the size of Trader Publishing's printing job, a local printer could not be used. Instead, officials at the Journal Record arranged for a printer in Gainesville, Texas, to take over the job.

This meant extra time would have to be allotted for delivery of the magazines to and from the printer. To accommodate this, Trader Publishing rearranged their distribution and delivery route schedules. Although company officials admit the scramble to find alternate printing was difficult, the disaster could have been much worse.
“At least we didn't lose any people or have property damage,” she said.

And the event has made Trader Publishing, and many other small businesses in the area, think about contingency planning for the future.


Janette Ballman is an editor with Disaster Recovery Journal.

This article adapted from V8#3.

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