What would you do if a virulent new strain of influenza swept through one of your larger markets, causing such widespread infection that you had to shut down part of your operations — or even close some or all of your stores for a period of time?

How would you respond if you couldn’t get key merchandise to your stores because your supply chain was impacted by a widespread and serious public health epidemic, or if you had to curtail business travel because of serious nationwide or international outbreak?

Most large retailers have, or are rapidly putting together, contingency plans for such scenarios. But the level of preparedness among many small, mid-sized and independent retailers isn’t nearly as clear; these merchants are certainly not as prepared for pandemics as they are for a tornado, hurricane or flood. But with the emergence of the H1N1 virus, retailers not game-planning for such an event could be making a costly mistake.

“Flu, in general, is always serious,” says Stephanie Perilli, medical and health management senior director for Home Depot. “Each year in the U.S. alone, there are approximately 36,000 deaths from seasonal flu. H1N1 is a brand new virus that just emerged this year: The public does not have immunity to this virus, so … every responsible business needs to understand how H1N1 can potentially impact their operation.”

Michael Lazcano, director of global business continuity for Gap, says his company takes the possibility of an H1N1 pandemic “very seriously and will take every necessary precaution to ensure our employees and customers are safe in the event of an outbreak. We hope other retailers will do the same.”

The World Health Organization (WHO) classified H1N1 as a pandemic on June 11.

“What that means is that the new H1N1 flu can and has caused serious illness in humans and that it spreads easily from person to person in a sustained way,” says Lisa Koonin, senior advisor for the Influenza Coordination Unit of the Centers for Disease Control and Prevention (CDC).

According to WHO statistics released on July 31, more than 160,000 cases of H1N1 have been documented in 168 counties, and the virus has been linked to 1,154 deaths. Since many cases have not been officially reported, however, Koonin says that CDC regards those numbers as “a gross undercount.

In effect, we believe there are at least a million people in the U.S. who have had H1N1 since it started in April,” Koonin says. “We’ve had outbreaks all through the summer and we are predicting that this disease will become much more prevalent this fall with the start of the flu season.”

As senior director of asset protection for Home Depot, Chris Canoles oversees the operational end of implementing a medical crisis management plan. In a presentation at the NRF Loss Prevention Conference & EXPO in June, he said that “the human-to-human transmission rate [for H1N1] is likely to be high during the upcoming regular flu season.”

Even though the current death rate is less than 1 percent, in a worst-case scenario “hundreds of thousands, if not millions, could die,” he said. “Every country in the world could be affected, and society would function poorly at best.”

Vaccines for H1N1 were in clinical trials at press time, with the expectation that deployment would begin in mid-October.

Crisis management plan
The best way for a business to manage a severe pandemic is to have a crisis management plan in place before a medical emergency materializes. Perilli characterizes the creation of a cross-functional crisis management team as an “imperative” and that “everybody within that team needs to prepare based on a worst-case scenario.

“What will you do in merchandising, for example, if you have product that can’t be delivered?” she says. “What will human resources do about sick-time policies if people can’t come to work? What will you do when people have issues with child care? What will operations do if you can’t staff a store? How do you close down a store?

“All of that has to be considered,” she says, “so your plan has to be comprehensive. That means you need to be sure that you have all the right players at the table when you create your crisis management team.”

Effective infection prevention begins with good personal hygiene. Home Depot provides guidance to its associates, “reminding them of the value of good hand washing, staying home if they are sick, seeking medical care when appropriate,” Perilli says.

Home Depot and Gap have hand sanitizing programs; Home Depot calls theirs “Nail a Few Germs.” Like Home Depot, Gap asks its employees to seek immediate medical attention if they are not feeling well and provides corporate and store-level employees with guidelines issued by CDC. Information supporting “health habits” has been made available to all Gap locations, as has supporting documentation in the form of FAQs about H1N1.

Next