From wild fires to wild weather, natural disasters are an unwanted but unavoidable part of life. While natural disasters are equal opportunity destroyers, small businesses are especially vulnerable. Are you and you employees prepared?
Consider this unsettling statistical snapshot:
- One in three small-business owners have been affected by a storm or extreme weather.
- When hit by a severe storm, one in four small- and medium-sized businesses do not reopen.
- After closing due to a major storm, small businesses – on average – lose $3,000 per day.
- Fully 84 percent of small businesses do not have disaster insurance.
- While 94 percent of small businesses prepare for disasters by backing up crucial data, only four in 10 take the critical step of storing that data off-site.
If you’re a small-business owner who hasn’t taken steps to prepare for a natural disaster, September – which is National Preparedness Month – is a good time to do just that.
While the seemingly supernatural destructiveness of some disasters simply can’t be curtailed, there are steps that small-business owners can take to minimize the damage. Toward that end, compare your disaster readiness with this preparedness checklist:
- Emergency response plan – In the event that disaster strikes during business hours, it’s important that a response plan is in place that outlines escape routes and lists all emergency-contact phone numbers. This plan should be posted at locations throughout your facility.
- Survival kit(s) – Depending on the size of your organization, one or multiple survival kits should be stored in well-marked, accessible locations, and each kit should contain sufficient supplies for the number of employees. Recommended contents include: bottled water; nonperishable food; first-aid kit;
flashlights (never use candles or matches); battery-powered radio; batteries;
tarps; cleaning supplies; gloves (rubber and leather); plastic bags; camera (to document damage); tool kit; duct tape; and blankets.
- Insurance coverage – Take an inventory of your current insurance coverage to ensure that – in the event that a disaster physically destroys your business – you are sufficiently covered from a financial perspective and that you’re covered for all types of disasters, particularly those that are prevalent in your geographic area. Additionally, small-business owners are encouraged to consider business-interruption insurance.
- Data – Given that most businesses are heavily computer-data dependent, it’s crucial that this data is backed up. In addition to being backed up and stored on-site, it’s also critical – in the event that your facility is not accessible following a disaster – that this data be stored off-site as well. Aside from financial and tax data, care also should be taken to backup all customer and personnel data.
- Communications plan – Have a plan in place outlining how you will communicate with employees, clients, vendors, etc., in case your business must be closed. For example, you may opt for email blasts, text blasts, or voice broadcasting through which voice messages can be sent simultaneously to office phones and cell phones. The plan additionally should indicate who is responsible for contacting these various groups, as well as who is assigned to contact the insurance company and any other parties that must be reached in the disaster’s aftermath.
- Alternate location – Prior to a disaster occurring, you should scout out possible alternate locations in case you must temporarily move your business. It’s worth noting that – through the Small Business Administration – any business located in a declared disaster area can apply for low-rate, long-term loans to help repair physical damage. If there was no property damage, business owners can apply for working-capital loans designed to help remedy disaster-related-economic hardships.