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Five Easy Ways to Safeguard Your Small Business Before Disaster Strikes

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Five Easy Ways to Safeguard Your Small Business Before Disaster Strikes

By Carol Chastang, SBA Official
Published: July 24, 2013 Updated: July 24, 2013

Eastern seaboard businesses continue their struggle to rebuild after Hurricane Sandy.  In terms of economic losses, the October 29, 2012 storm will be remembered as one of the largest natural disasters in U.S. history.

Many residents and businesses, particularly in the hardest hit coastal areas of New Jersey and New York, were caught off guard by the late-season storm.  In addition to the property destruction caused by high winds and flooding, power outrages created big headaches and huge financial losses for many small businesses.

Weather experts from the National Oceanic and Atmospheric Administration (NOAA) are predicting an “active” 2013 Atlantic hurricane season.  The six-month season, which began June 1, typically peaks between August and October. Now is a good time to put a disaster preparedness plan in place to protect your employees and your business.

The SBA and Agility Recovery recently hosted a free webinar giving tips on how to prepare for Hurricane season.  But it doesn’t matter if you’re in the Gulf Coast or the Upper Midwest—all kinds of risks exist, and small businesses are particularly vulnerable. 

Go to this link to download the slides from the recent “Protect Your Business This Hurricane Season” webinar.  You can also view the recorded webinar at any time. You will need Windows Media Player 9 or higher.

Meanwhile, there are a few things you can do, at no cost, to jump-start your business continuity plan:

  1. Determine your greatest risk potential.  It might come from wind damage or the inland flooding that typically follows the tropical storm’s heavy rains.  Meanwhile, your business could suffer financial losses due to road and bridge closings in the aftermath of a hurricane.  Power outages are a major threat, especially to businesses in the food and hospitality industries. What would happen if you had to shut down your business for several days?  Look at the building where you do business—inside and out—and assess the risks. If you do this early enough, you’ll have time to do structural upgrades—like impact resistant doors and windows—that can prevent possible future storm damage.
  2. Calculate the cost of business interruptions for one week, one month and six months.  Once you’ve done that, you’ll be able investigate insurance options or build a cash reserve that will allow your company to function during the post-disaster recovery phase. It’s also a good idea to develop professional relationships with alternative vendors, in case your primary contractor can’t service your needs.  Place occasional orders with them so they regard you as an active customer. 
  3. Review your insurance coverage.  Contact your agent to find out if your policy is adequate for your needs. Consult with a business insurance expert to advise you on the right coverage for your situation. When buying insurance, ask “How much can I afford to lose?”  It’s a good idea to know the value of your property.  You also may want to look into flood insurance.  According to the U.S. Geological Survey, floods are the leading cause of natural disaster losses. Most property insurance policies don’t cover basement flooding. 
  4. Build a crisis communications plan so you’ll be able to make sure your employees, customers, vendors, and contractors know what’s going on.  Establish an e-mail alert system.  Make sure you have primary and secondary e-mail addresses for your employees, and everyone you do business with.  Create a Facebook page, and use Twitter to let the community know you’re still in business, and in the process of recovering after the disaster.
  5. Consider a Telework Policy.  Prepare for the possibility that employees won’t be able to get to work by developing an emergency telework policy. Read  “How To Make Telework Work for your Small Business” for more information.

Each month SBA and Agility Recovery hosts a free webinar providing business continuity strategies. The August 13th webinar will focus on useful tips for building your own disaster preparedness plan.   Space is limited so register now.

Related Resources

 

About the Author:

Carol Chastang

SBA Official

Comments:

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Wow, that’s what I was searching for, what a information! Timely and scientific prevention can reduce the loss in faced with disaster, and it also can keep more ability to recover themselves!
Its so sad to hear of all the damage that they suffered and how many so many families and businesses were wiped out due to nature. We live in the middle part of NC and although we don't have hurricanes often or major disasters its always nice to prepare.
very sad to hear of all the damage that was caused!! It's great to have support and information that can be helpful if this was ever to occur again
The harsh reality is that many of the businesses affected by Hurricane Sandy may never completely recover. Being out of business a day or two is one thing, but a disaster-related shutdown that lasts for weeks—or months—can be crippling and lethal. Taking steps now to protect data, digital assets, and intellectual property is one of the smartest things you can do to support your business. Having a clear, strategic backup and recovery plan can mitigate many disaster-related losses, and get your business up and running faster.
Thanks for the feedback and the kind words!
Preparing for any natural disaster is a must.. but be sure to check the fine print on your insurance documents as I know of many businesses in the recent floods in Australia that have been caught out. This was due to insurance companies classifying the natural disaster as Storm water flood rather than riverine water... even though the river flooded the storm water drains.
Thank you for this useful information.
You're welcome!

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