Whether sparked by natural causes or human activities, fires possess a devastating power that transcends mere destruction. Beyond the evident devastation and emotional toll, the aftermath of fires inflicts a significant financial blow. For businesses, the costs transcend the immediate expenses of firefighting and property restoration; they encompass lost assets, interrupted revenue streams, supply chain disruptions, and a complex web of financial challenges that leave a lasting impact on large and small businesses.
Taking proactive measures to prevent fires from occurring in the first place can significantly mitigate the potential financial catastrophe that businesses face. It’s no longer sufficient to rely solely on reactive strategies; a shift towards robust fire prevention measures is imperative to safeguard businesses.
The figures
The economic and social cost of fire is split into 3 overarching areas:
- Anticipation – measures designed to either prevent fires from occurring or protective measures to mitigate the damage and impact of fires.
- Consequence – direct and indirect costs that occur as a result of fire, such as property damage, loss of business, human injury, and fatalities.
- Response – the cost of fire and rescue services responding to incidents.
The financial cost for ‘consequence’ in the year ending March 2020 is estimated to be £3.2bn. Of that total, an astounding £2.0 billion is expected to come from property damage with £0.4 billion coming from physical and emotional harms.
Lost Output
Whilst ‘consequence’ can be broken down into several segments it may be particularly interesting for businesses to look at lost output.
Lost output can be split into the 4 following areas:
- Property damage/business closures.
- Time off work following injury.
- Reduced productivity following injury.
- Fatalities.
Lost output resulting from business closures and property damage is calculated by estimating the number of employees rendered unemployed or unable to work as a result of a fire, and the lost earnings to an employee are assumed to represent the lost output to a business. The estimated total cost for lost output in the year ending March 2020 was £170m.
Prevention and Damage Limitation
The aftermath of fires paints a stark picture of the far-reaching consequences that extend well beyond the immediate destruction. Fires exact a heavy toll, both emotionally and financially. This is particularly evident for businesses, where the impact goes beyond the visible costs of extinguishing fires and repairing property. It encompasses lost assets, disrupted revenue streams, supply chain disruptions, and complex financial challenges, leaving a lasting imprint on enterprises of all sizes.
However, amidst these challenges lies a valuable lesson: the significance of fire prevention and minimizing damage. It’s clear that the shift from a reactive to a proactive approach is critical. Prioritizing robust fire prevention strategies becomes vital not only to avert potential financial ruin but also to ensure the continued stability of businesses.
Fires may bring disruption, yet they also emphasize the importance of limiting damage and instilling preventive measures. Businesses are urged to take heed, recognizing that preparedness and proactive strategies can make all the difference in weathering the financial storm that fires can bring.
To find out how Martyn Young Fireproofing Consultancy can help, contact us on 07585 896648
For more information visit Economic and social cost of fire – GOV.UK (www.gov.uk)