Technology makes almost every aspect of our lives easier. As technology has evolved, our society has become increasingly dependent upon these tools we use in our everyday lives. Whether at work or at play, we need technology. Just as we are dependent upon technology, most of these innovations are dependent upon electricity. Without electricity to provide power, these tools become obsolete. As a result of technology’s role in our lives, we are dependent upon electricity. In its absence many of our daily activities become impossible until electricity is restored.
When the power goes out, businesses tend to feel the loss in their bottom lines. Even a few hours without power can cost a business a significant amount of money. The losses can be directly measured via lost sales, manufacturing time and, for some businesses, even inventory.
When power is not available, many businesses have to close. They are without lights, computer systems and all of the other things that make doing business easier. Not only is it unfeasible to bring customers into a building that doesn’t have power, it is generally difficult to receive payment and track sales without the assistance of a computer. These examples of lost sales could potentially affect any retailer or restaurant that suffers a blackout. For warehouses and manufacturing facilities, operations tend to cease immediately. Manufacturing equipment and computers that track shipments cannot operate without power, which makes these businesses obsolete in a power outage.
But how much can a power outage cost? The immediate impact is different for every business, but consider these figures:
- A Massachusetts restaurateur estimated that he lost $3,000 in sales based upon one afternoon without power.
- A report by the Consortium for Electric Infrastructure to Support Digital Society studied several hundred businesses in the United States concerning monetary losses that are associated with power losses. They estimated that businesses in the Digital Economy (online businesses from financial trading to data storage) and Manufacturing Industry lose $45.7 billion dollars a year due to power outages. This figure is comprised of lost sales, time and damaged equipment.
Realistically no business can go without power. Even short outages can immediately set a business back. If equipment needs to be restarted, data entry needs to be looked over to make sure nothing was missed or any other catch-up type activities need to be performed money is lost. In addition to what can be measured, it is difficult to measure the opportunity cost of blackouts. If you operate in Tampa, Florida but your customers are in Jacksonville, they might not understand that your lack of power supply is the reason that things are not getting done. They might take it out on you by decreasing their business with you.
Whether you can measure your losses precisely or not, you know that lost power means lost money. Some estimates say that just one second of lost power for an industrial facility can cost over $1,000. That is a precise enough number to make buying a standby system a worthwhile investment.