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Calculating Loss!


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#1
LynnAisling

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Good Morning! We recently lost our T1 line which took down our phones, internet, fax and of course email. We were down for about 5 hours due the negligence of a construction crew.

I'm being asked to calculate the cost of this loss. Any ideas on how to do that?
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#2
ScHwErV

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Calculating loss and showing loss are two very different things. If you are looking at legal action, then you need to be able to show loss. Did you lose customers, can you prove it? Did you miss important information, can you prove it?

Phones and fax are going to be hard enough. I don't know what your business is, so it would be impossible to calculate any possible losses there.

Internet is a whole other beast by itself. Do you use the internet to perform the functions of your job? If so, were your employees able to continue working without it? If not, then you could claim their wages. If so, then you cant claim that as a loss, since nothing was lost.

Email will be nearly impossible to claim. Any good mail server will see that a server thats supposed to be there, isn't. Any email sent during the outage should be held by the sending mail server for 24 hours and then tried again. Therefore you shouldn't have lost any email. This only holds true if you have your email server on-site. If your email is hosted by your ISP, then all the email would have still been delivered to the individual mailboxes, it just wouldn't be picked up until later.

After all that typing, I still don't have an answer for you, just more questions for you to ask yourself.
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#3
sari

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Without knowing more about your business, it's difficult to be specific, but I can give you some things to consider.

The first would be loss of productivity. You had X number of employees who were probably basically idle for that 5 hour period. You would need to assign a dollar value to the employees, based on salary or job title and multiply it by the number of hours of outage. The other consideration would be potential loss of business. Again, I don't know what you do, so I'm not sure how to calculate that. It could be an estimate of lost sales, work not completed, or some other factor. You would probably need additional input to calculate that figure.
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#4
Troy

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Phones and fax are going to be hard enough. I don't know what your business is, so it would be impossible to calculate any possible losses there.

Hi there,

One way to calculate phone and fax information is if you have before and after information on these - such as average statistics per day, set into a graph. This may not be very helpful to you if you don't have before information, but it's just one way that you could take these things and convert them into potential loss information.

If you do have this information, then you will be able to show, by way of average, that your business will usually receive X calls and from that, you can convert Y calls into sales (or however your business works...). Then, on the morning in question when everything went down, you should be able to show an average to be able to claim.

Just a thought I had. :)

Cheers

Troy
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#5
Titan8990

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Also, have a look at your service agreement. Many business oriented ISPs have an allotted ammount of time they say they will get the internet back up if it goes down. Also many give an "up time" in their agreement such as guaranteed such as 98% uptime. If your ISP breaks this service agreement then you have the right to drop the service without paying the early termination fee.
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#6
dsenette

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Also, have a look at your service agreement. Many business oriented ISPs have an allotted ammount of time they say they will get the internet back up if it goes down. Also many give an "up time" in their agreement such as guaranteed such as 98% uptime. If your ISP breaks this service agreement then you have the right to drop the service without paying the early termination fee.

these agreements do not apply to "catastrophic events" that are outside of their control...such as a construction company cutting the fiber outside your building...if the ISP doesn't own that fiber (or copper depending on what got broken) then they actually aren't responsible for the repair or the outage so their agreement of "uptime" does not apply.
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