Why do industrial businesses have the most to lose from fire?

Fires have the ability to destroy buildings of any type which, in addition to the significant risk to life posed, can have a devastating impact on the ability of a business or organisation to recover. In fact, some never recover – either through loss of income, loss of equipment and stock, prolonged downtime, loss of customer base to competitors or other knock on effects. We see this happen all too often to organisations of all kinds, but those hit the hardest financially are industrial processing and manufacturing businesses.

Data recently analysed by RISCAuthority, a research scheme administered by the FPA, showed that industrial businesses suffered the largest financial losses over a ten year period post fire. This sector suffered an average cost of £1,132,000, with some cases incurring costs more than £57m. This compared with the average cost across all building types of £657,074 is a staggering amount. It’s easy to see why – the sheer size of the real estate commonly owned by these companies, and the value of the machinery and equipment held on site, means that fires are extremely costly. Similarly, in the same way that industrial businesses were hit harder by the COVID-19 pandemic than companies whose employees could work remotely, the same is true of the impact of fire: if a site is unusable there is no production, no distribution and thus stifled revenue.

The frustrating side to all of this is that the risk of loss can be dramatically reduced through more thorough planning, and a greater knowledge of the systems that can be put in place to limit the impact of a fire. So what should industrial and manufacturing business specifically be thinking about?

The most influential measure to reduce the impact of a fire in an industrial building is the use of fire suppression systems. This will often be advised as part of a fire strategy or fire risk assessment, and acting on the recommendations made is paramount in mitigating the risk of building stock and/or equipment loss. Industrial buildings contain large spaces often with manufacturing processes which don’t lend themselves to compartmentation – meaning a fire can potentially spread widely and at a fast rate. The use of fire suppression systems can prevent a ‘domino effect’, reducing the risk of the fire spreading to other parts of the building.

One of the many reasons for recommending that industrial buildings should have suppression systems is that they may be sited in remote locations; fire services may take longer to get to them, allowing a fire more time to spread. Suppression systems - sprinklers in particular - are a proven means of mitigating this risk. While many believe that sprinklers can cause water damage to important assets, it should be recognised that only those sprinkler heads affected directly by flames and heat from a fire will activate and that for 95% of fires where the sprinkler system operated, five or less heads were activated[1].

Industrial machinery can also be a major cause of fires in the first place. To reduce risk, it is vital that equipment is cleaned at suitable frequencies and inspected and maintained on in accordance with the manufacturers’ instructions, preferably by contractors who have been third party approved to ensure standards are met.

The use of DSEAR (Dangerous Substances and Explosive Atmosphere Regulations 2002) assessments will also act to limit the risk of fires in industrial buildings - these will often be a recommendation following a fire risk assessment. DSEAR requires business operators to identify the risk posed by the storage and use of dangerous substances – ranging from: liquids (solvents, paints, varnishes), flammable and compressed gases, dust from machining and sanding and substances corrosive to metal – and take effective steps to minimise, mitigate and manage those risks appropriately. Having this in place makes the workplace a safer environment for all employees. A DSEAR risk assessment will boost the overall competency of workers who handle dangerous substances and in turn reduce the risk of fires.

Achieving organisational resilience against all risks posed, including fire, is part of responsible management. With the most to lose in the event of a fire, industrial and manufacturing businesses must take a rigorous approach to fire safety, based on a proper strategy which dictates the measures required to ensure safety. Can you say this about your business?

This blog was produced as part of the FPA's Know Your Building campaign. Our commitment to helping to make the built environment a safer place to live and work. 

[1] Efficiency and Effectiveness of Sprinkler Systems in the United Kingdom: An Analysis from Fire Service Data