“A business continuity plan is an essential factor of a small company’s long-term success and will contribute to the community’s economic recovery in the aftermath of a disaster.”

Maria Contreras-Sweet
Administrator, U.S. Small Business Administration

As we enter the season of storms and power outages, it is necessary for small business owners to get ready. The following information comes from a recent SBA webinar.

Are You Prepared?

Generally, it takes several years to build a successful business, but minutes or hours to be destroyed by a disaster. The Federal Emergency Management Agency (FEMA) estimates 40% of businesses do not reopen after a disaster, and of those that do reopen, 25% fail within one year. Disasters don’t just include earthquakes and tornadoes. They also include things like hail storms, power outages, and pandemics. In order to prepare for the worst, business owners should:

• Understand their vulnerabilities
• Plan for a disaster
• Periodically conduct drills to test the effectiveness of their plans

Are You Disaster Ready?

Getting back to business after a disaster depends on how prepared you are today. Small business owners invest significant time, money and resources to make their ventures successful. Emergency planning is important but may be put on the back-burner in the face of more immediate concerns. For small business owners, being prepared can mean staying in business following a disaster.

Are You Taking A Risk?

If you don’t have insurance, you’re gambling with your business. Even if you do have insurance, there are still several things that a business owner should consider:

• What does your policy cover?
• Is your coverage adequate? Insurance should be sufficient to cover the cost to repair or rebuild your business or home. Replacement cost of your property is not the same as its real estate value. Coverage should include attached structures, such as a garage, storage building or deck.
• Flood coverage and business interruption are normally separate policies.

Prepare a Business Disaster Toolkit

Every step that you take to prepare for a disaster allows your business to be more resilient should the worst happen. Here are a few easy suggestions to prepare for an emergency:

• Check insurance coverage, including business interruption.
• Communicate your disaster preparedness plan with all employees.
• Back up computer records often and store critical paper and electronic records off site.
• Make sure you have essential phone numbers for insurance agents, employees, vendors and customers.
• Consider using a website to post information about your business, so vendors and suppliers can stay informed.

Prepare a Disaster Survival Kit

In addition to the above steps, business owners should also physically prepare for an emergency. Begin by creating a disaster survival kit that is both waterproof and fireproof.  Update it regularly. Include:

• Cash
• Nonperishable food (3 day minimal supply) including a can opener
• Water for each person/pet (1 gallon per day, per person)
• First aid supplies and medications (eye glasses/contacts)
• Radio, flashlight, batteries, blankets
• Whistle to signal for help
• Sanitation supplies
• Basic tool kit

Disaster Planning Resources

Look at the Insurance Institute for Business and Home Safety website and review the “Open for Business – EZ toolkit.”  The information helps small businesses take the steps needed to keep functioning in the event of a major disaster or a smaller disruption.

Each month, Prepare My Business hosts free, educational webinars. Attend these virtual live courses to learn more about how to plan your business continuity and disaster recovery strategy. The more you know, the more you can help reduce your business’s risk and quickly recover in a disaster.

Helpful Websites

www.sba.gov/services/DisasterAssistance provides disaster assistance resources.

www.PrepareMyBusiness.org provides business-focused disaster preparedness and planning tools.

www.Ready.gov has emergency preparedness publications available to the public at no cost.

www.ReadyRating.org is a free program from the American Red Cross that helps businesses, schools and organizations become prepared for disasters and other emergencies.

www.DisasterSafety.org from the Insurance Institute for Business & Home Safety advises home and business owners how to prepare for disasters.