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Last Update: Thursday July 29, 2021

Key Idea: Prepare For The Worst

This is just what we business owners don't want to think about but we have to.  

Key Question:


First, you have to prepare for the worst.

Q:   What did the insurance agent tell us about the Calise brothers?

A:  Tommy said that they do their due diligence.  They know how to run a safe plant and pay attention to what could be a potential problem.

Q: What is the biggest problem faced by an owner who has been hit by a physical disaster?

A: Other than the emotional devastation, the biggest problem is ready cash. The big insurance companies are excellent at arriving on the scene and getting cash into the hands of customers.

Q:  For those of us who don't manufacture, do we still have assets to worry about?

  Of course.   Information is a real asset. It is part of the learning continuum, where data evolves to information which evolves to knowledge, and ultimately, wisdom. The learning continuum has been around a lot longer than computers but computers have greatly enhanced our data processing ability and thereby empowered us to move faster, deeper, and farther along the continuum.

Q: If you arrived in the office one morning and all your cash or all your information were gone, which would be the more devastating to your business? Which do you protect better? Your cash or your information?

A: Most of us have strong controls over cash. We limit the authorized signers on checks, take advantage of positive pay products offered by our banks, lock up check stock and reconcile our bank accounts. We need to safeguard the information of our business. Our records are at risk from natural disasters, virus attack, or computer malfunction. Hard drives do go out; data can be corrupted or lost. We need to be mindful of the enormous value of our information and take the necessary steps to safeguard it with the same motivation that we safeguard our cash and tangible property.

Think about it

Have you audited your current insurance program? Is it time to re-think the type of coverage you have and for what? Is there a way to insure the data recovery period?

Do you have a disaster recovery plan for your business? What would be the effect on your business if you lost your information?

Clip from: Calise & Sons Bakery, Providence

Providence, Rhode Island:  Visit an old New England family business. With roots back to 1908,  the Calise & Sons Bakery has been through the good times and the bad.  The founder gave the reins to his four sons and they just about ran that business into the ground. Three grandchildren came to the rescue. They bought the business, and then went to work to retire the debt. They did it, then they built the business beyond anyone's wildest expectation.

Calise & Sons Bakery now serve most of New England, New York and Pennsylvania and increasingly they'll be serving the world. Big chains and grocery stores -- The Olive Garden, Shaws and Albertsons -- depend on them. But, you know, even with such success, it is just not easy. 

The Calise brothers make bread from the same recipes their grandfather brought from Italy.  Yet, it took them nearly 30 years to bring this company back from the brink. The brothers learned on the job. Though there are no MBAs here, their management practices are now case studies in major business textbooks.

The adoption of technology and the acquisition of competitors have fueled growth and prosperity. These owners quickly learned a key big business secret -- grow by acquiring your competition.

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Calise & Sons Bakery

Michael Calise, VP, Sales

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Business Classification:
Food - Bakery - Bread

Year Founded:

Prepare For The Worst

HATTIE: (Voiceover) Tommy De Santo has known the Calises for over 20 years.

TOMMY De SANTO: Well, and they have a goal, a common goal, to make Calise's Bakery the best bakery, at least in New England, and maybe one day in the nation. So they have the great desire. They still have the killer instinct, and I think that's what's important.

HATTIE: So you write their insurance?

TOMMY: I write their insurance. Twenty-two years ago, it was a big opportunity for me to write a bakery. And I was making a presentation, and Joe and Bob and Mike were in the room. And Joe was counting some money, and at the same time we're talking about my proposal. And I said, `Well, what do you like to do?' And he says, `Fine.' Mike said, `We approve of this proposal. Let's go with it.' So I proceeded to call my office. And, in fact, I called in the underwriter director and bound the entire account.

HATTIE: It's done. It's a deal.

TOMMY: It's done. You're covered. I hung the phone up. I think, within six or seven minutes, I felt these eyes looking over my shoulders and passing right through me, and I couldn't imagine why. And all of a sudden, Joey stands up and hands me this cash box full of money. And they all run out of the room. So I turned around and I look out and I'm gassed. And I look and I see flames 40, 50 feet high.

HATTIE: Oh, no.

TOMMY: I just couldn't believe it. I thought the building was totally on fire. But, thankfully, it was only some baskets and some plastic that was outside the building. I did the sign of the cross and said, `Thank you, God.' And it was the beginning.

HATTIE: And it's been great ever since.

TOMMY: It's been an adventure and a great time. They pay attention. They do their homework. They have a good maintenance crew, they do they're due diligence. And they keep their hands on the pulse of their business.

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