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The Forgotten Playbook For Making Your Company Crisis-Proof

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What do you do when an earthquake, tidal wave, and nuclear fallout threaten your small company? When the Tohoku earthquake struck Japan, a devastating tsunami swept across the country, destroying most of the Japanese coastline and triggering the world’s greatest nuclear accident since Chernobyl in 1986.

We have 45 days to solve an insurmountable challenge or go out of business. Years of work, sweat, and tears have gone into constructing the entrepreneurial dream, which is going to disappear into thin air.

How did we overcome the ultimate catastrophe with no resources, expertise, or leadership, and turn collapse into record-breaking sales and profit? I was in charge of a company that only imported items from Japan. As a result, while our operations in the United States were not physically harmed, they were put in jeopardy.

Every business owner understands the present predicament and how it was difficult to plan for. Furthermore, when no one has a clear answer, it is often hard to locate individuals, techniques, or knowledge to assist you through the problem.

Crisis issues become entangled and resemble the impossible knots in a hooked fishing line. “Cutting the line” is the fisherman’s response to an impossible knot. In business, crossing the line typically signifies going out of business.

Our difficult knot problem was caused by limited inventory and a shattered supply chain, which left us with no way to obtain fresh inventory. Customers were widely concerned about potential contamination as a result of the nuclear catastrophe.

Our financial reserves were depleted, and banks refused to provide us a viable loan. To top it all off, the Yen to USD exchange rate plummeted, thus a $10,000 purchase resulted in a $7,698 product. We’d have to increase our pricing (in a competitive market where we were already the most costly) and wouldn’t be able to inform consumers when their goods would arrive.
The approach I followed is outlined here, along with concrete examples of our implementations and outcomes.

Divide Complicated Tasks Into Manageable Parts.

Complex problems are hard to address since they are always comprised of dozens of little issues. We didn’t have the people, money, or time to throw at the issue, as many small firms do. Each difficulty was easier to understand and tackle when it was broken down into pieces. When confronted with a large challenge, it may be unpleasant, scary, and psychologically draining.

I split the issues as follows:

  1. Cash
  2. Inventory
  3. The supply chain
  4. Customer service/complaints
  5. Marketing and sales

Smaller problems are easier to handle because you can examine them quickly and take action in a manageable manner.

We were able to minimize inventory and supply chain issues by evaluating pieces because we had no control over them. Then we understood that sales were only a symptom of a larger problem with cash flow. Even the customer issue was a “symptom” of forces beyond our control.


Be Highly Daring And Inventive In Your Problem-Solving.

Business crises provide you the chance to adopt a liberated mentality. You are already aware of the worst-case situation (closure) and are aware that it will occur if you proceed regularly.

This indicates you are no longer concerned about upsetting “what works.” We have the flexibility to make creative actions that would ordinarily be considered “too hazardous,” because we are already in the most dangerous scenario. Because the danger has altered, being really daring and innovative is now safer than functioning routinely.

While we had funds to order stuff, the difficulty was that we couldn’t get it to us. The money would be sitting in the bank, unused (and probably end up drained). However, we had partner firms that we knew required capital for expansion. So, what exactly did we do? We gave them loans for two to three months.

“The money’s gone, and it’s not coming back,” we reasoned. We had that danger even with cash in the bank. We recognized that making basic loans and just reissuing them till we could order stuff was less hazardous. Solving a monetary problem by getting rid of cash was an unusual but successful strategy.

Another implementation was with people we knew who sought new ways to invest. So we devised a strategy in which they could buy items at wholesale and we would simply sell them as part of our usual operations out of our warehouse. We received the wholesale profit, while they received the retail profit. It worked so well that even after the crisis, most people just kept reinvesting.

When we were finally able to order again (nine months later), we purchased considerably more inventory, fueled by wholesale investments and retail pre-orders. Larger orders lowered our expenses, and we profited from loans, wholesale investments, and retail sales to customers.

Your Most Crucial Tools Are Your Website And Email List.

An effective website and a great email list solve, simplify, or aid in the resolution of all problems. They are more valuable than currency since they serve as vehicles for generating revenue on demand. They are the only assets you personally control and are crucial to the success of a modern, solid firm.


Social media provides a distinct function. It is used to reach an audience that you would not otherwise have easy access to. They provide a one-of-a-kind opportunity to acquire rapid, explosive exposure and are important components of growing your website and email list. Because you don’t have a billion people on your website, your website isn’t capable of the same kind of rapid exposure.

Unfortunately, social networking has two drawbacks. One: You don’t have any property. Your profile, followers, and content have all been “rented.” Everything may be taken away at any time for whatever reason the platform deems appropriate. Two, because you’re competing for attention with everyone else, your engagement results aren’t as excellent as your website and email.

We had the greatest Facebook page in the industry, with 100,000 followers, and a YouTube channel with millions of views. They were crucial in expanding our consumer base and website. The issue was on social media, where we received one-tenth the interaction compared to email and the website.

We were only able to achieve business-saving outcomes because we were able to develop, adapt, and change the website to meet the unique circumstances and give concentrated contacts via email.

What if you don’t have a website or an email address? Our alternative ideas would have been ineffective because we would not have been able to contact the requisite number of individuals to address the problem. The enormous value and influence these assets have on a company’s capacity to survive and flourish are what inspired me to make website design and web development the primary service of my firm when I founded it in 2015.


Face Challenges Straight On And Communicate Openly With Your Consumers.

Everyone understands that life is unpredictable and flawed. Acting as if nothing is wrong only exacerbates the problem. We often put off talking to consumers or withholding facts because we are frightened of how they may react. The problem will eventually come to light, and if you keep it hidden from your consumers, you will lose their confidence and faith.

Instead, take fast action and be very honest about the problem. Be extremely talkative, especially if you don’t usually have a lot of reasons to speak.

We had a client list of 8,500 persons. I called, emailed, and texted each and every one of them. I treated them as though they were valued members of our company’s team. They were told everything, flaws and all, and they eventually became so interested that we’d have online “war-room meetings.” Our consumers began to feel as though they were in it with us, celebrating our successes and mourning our losses. As a result, they received record-breaking orders, even though they had no clue when they would receive their item while paying twice.

People are endowed with an endless capacity for kindness, understanding, and loyalty. However, no one gives it out for free. You have to work for it.


Written by Kusuma Nara |The Entrepreneurs Diaries is now available on Telegram. Join our telegram channel to get instant updates from TED.

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