Fact or fiction

[SeaBass]

I’ve heard and read on a number of occasions over the years that 70% of all business’s that suffer a fire will cease to trade within three years (or variations on that general theme) I’m fairly sure that an article in one of the fire extinguishing trade magazines carried this statistic earlier in the year, or maybe it was one of the on-line trade forums,  I can't remeber now, and that's the problem, I can’t find or confirm the source of this little gem.

Does anyone know if it’s fact or fiction, and if it’s fact what the source is? 

[deaconj999]

Ruby,

There are many websites of 'fire safety consultants' stating this and other arbitrary figures along these lines as FACT!

IMO scare tactics to attract the business of a conscientious person. Why not say if you don't choose us to do your FRA, when you get a fire you will probably go out of business straight after and please bear in mind if you are unlucky enough to have a fire, you'll probably likely to continue this bad luck and lose your business also.

I would carry on to a FSC that was recommended word of mouth or registered in some way (credibly).

Is it fact or fiction - I don't care

[bungle]

I seem to remember in 1990 when I joined the quoted  figure was about the same so you may need to go back some time to find out where it comes from, or you could try the Association of British Insurers.

Bungle

[SeaBass]

Hardly scare tactics if it’s a fact GFSM. Quite the contrary, it’s potentially a valid statistic which can be used to put the risk to peoples livelihoods in context during staff fire safety training courses. That is if it’s based on fact, which is what I am trying to determine. 

Thanks Bungle. I suspect that it might be a very old statistic which is sort of borne out by your posting. 

[deaconj999]

Ruby,

Keep trying then, you could pick any figures and period of time prior to the business failing. You asked Fact or fiction on the figures !  If you google

'all businesses that suffer a fire will cease to trade within' you will see what I mean, you could also go to the ONS and see what that gives you.

As far as including it in a fire safety training course I fail to see what it would achieve other than to get the audience attention, but that can be done without this silly 'statistic' if the training course is specifically designed to that workplace in which it is delivered.

[wee brian]

I've tried to find the basis of this figure in the past and failed. Theres probabbly some basis to it but the word "fact" may not be appropriate.

[colin todd]

figures like this were promulgated by the FPA in the 1970s.

[wee brian]

Then it must be true........

[Phoenix]

As a trained statistician, I can tell you that almost every statistic that you may come across in such a context, whilst having some basis in fact, is an out and out misrepresentation of the whole picture. 

For example, how many of these 70% would have gone out of business anyway?  How many were fraudulent?  How do we define suffering a fire?  Does a fire in a waste bin that was put out by a cup of coffee get included?  How was the data collected?  Did it come from a random selection of all businesses?  I doubt it - it was more likely collected from selected businesses - you can't do that if you want a true representation of reality. 

If there really is a correlation between suffering a fire and going out of business how has the causal link been established?  That's the important one.  Even if the bare statistic is true how do we know where causality lies?  (Don't tell me that there haven't been situations where a company is failing and a fire has been a convenient way out for the failing businessman or woman - what is the cause in that case, the fire or the failing business?).  The stated claim of 70% strongly implies not just correlation but also causality and this is completely unjustified.  It is always wrong to present correlation as causal without further justification.

Stu

[kurnal]

A quote from the BRE film "Your Office Fire"

"Home Office records show that 40% of all businesses that suffer a major disaster including a fire fail within a year"

[nearlythere]

A quote from the BRE film "Your Office Fire"

"Home Office records show that 40% of all businesses that suffer a major disaster including a fire fail within a year"

In 40% of cases would that have been the intention?

[deaconj999]

Wow,

I'm really worried now - 70% in 36 months or is it 40% in 12 months or even 85% in 18 months, hang on a minute....... 70 divided by 3 is ..... mmmm 23.3 recurring businesses failing after a fire within 12 months not as bad as 40 'phew'. Unless, the 40 are those that didn't know about DSEARRRGGHHHHH........Hang on 85 divided by 1.5 is 56.6 recurring .....that means that these businesses only have a 50/50 at best chance of surviving after a fire, do these people know this when they start up in business.

I've even heard it's 1 in 10 over an unspecified period also, what does that mean. Those of your running your own businesses must be prepared, make sure you know which statistic you fall into.

Faced with these FACTS, how do I break it to my best mate running his welding business the odds are stacked against him and my wifes boss running a flower shop that she should be able to start up again if she has a fire, but it cannot be guaranteed, more importantly which fixed period of time do I use when I break this potentially bad news to both of them.

I hope thay aren't going to set a fire just to get the insurance, especially if the insurance company are aware of these FACTs.
Theres is a very old saying "Lies, damned lies, and statistics" which is a phrase describing the persuasive power of numbers, particularly the use of statistics to bolster weak arguments, and the tendency of people to disparage statistics that do not support their positions.

Sorry but I hate scare FACTics as it is unprofessional IMO.

[Phoenix]

A quote from the BRE film "Your Office Fire"

"Home Office records show that 40% of all businesses that suffer a major disaster including a fire fail within a year"

In 40% of cases would that have been the intention?

Well said, NT.

[Mar62]

GFSM - yr reply did make me laugh! Very good