All of the damage and chaos created by hurricanes Harvey and Irma
in recent weeks have highlighted the need for small businesses to be prepared in the case of a natural disaster. Up to 40 percent of small businesses never recover after a natural disaster. And while dealing with those situations is never easy, having a plan can make it easier for you to navigate your business through the process.
Small Business To Dos to Survive a Disaster
Since there are so many different factors to consider, Small Business Trends spoke with some experts who offered tips on various aspects of disaster preparedness and recovery. Here are 10 tips that can help your business survive a disaster.
Create Drills for Potential Disaster Scenarios
James R. Bailey
, Professor and Stacy and Jonathan Hochberg Fellow of Leadership Development at the George Washington University School of Business, said in an email to Small Business Trends, “Advance planning require scenario forecasts. Considering every possibility, no matter how unlikely, should be entertained, rehearsed, and drilled.”
Back Up All Important Records in the Cloud
According to Kevin Miller, CMO of business expense management software Neat
, the best possible option for small businesses is to keep important documents in a cloud solution that also organizes your records and makes them searchable. But it’s also acceptable for small businesses to use a simpler cloud solution. Or, if you must keep hard copies of certain documents, keep them in a separate location or a fire and flood proof safe.
Get a Second Opinion on Insurance Coverage
Having the right insurance coverage can make a huge difference in your business’s ability to successfully make it through a natural disaster. For that reason, it’s paramount that you have coverage that doesn’t include gaps. Jeff Dudan, CEO of mold and water damage cleanup company AdvantaClean
, said in a phone interview with Small Business Trends that small businesses should really have an agent that specializes in protecting businesses. And it also can’t hurt to get a second opinion and reexamine your coverage annually in case you might need to make any updates.
During the Disaster, be Sure to Act Decisively
Once you’re actually facing a disaster situation, the time for planning is over. And it’s time for you to actually take action. In that case, it might be necessary for you to adjust your leadership style.
Bailey explains, “There’s a real difference between management and leadership. In calm times, a steady hand is best. Level, analytic, measured. Management is the order of the day. But in a crisis, quick and decisive action is called for. Consensus is usually the best path, but consensus takes time. In a disaster — however construed — time is of the essence. Strong and forceful and, sometimes, uncompromising, leadership rules the day.”
Assess Any Damages to Your Business Before Resuming Normal Operations
Once the disaster is past, Dudan cautions, when assessing damages make sure your business location is actually safe before re-entering. That means taking a look at the foundation of the building, ensuring that water has receded and looking out for any broken electrical wires. Be sure the building is safe before asking your employees to return.
Make the Physical Health and Well Being of Your Team a Top Priority
It’s also a good practice to invest in some protective equipment, include eye protection and ventilation masks, especially if there might be mold or other water damage in the building. Additionally, Dudan says that it can be easy for people doing cleanup after disasters to get overworked and fatigued. So he recommends making sure you have enough snacks and bottled water on hand, as well as scheduling regular breaks.
Be Sure About Filing a Claim Before Contacting Insurance Companies
If your location has significant damage, you’ll of course want to contact your insurance company as quickly as possible to file a claim. However, if you’re dealing with some minor damage and are unsure about filing a claim or not, Dudan said it’s best to price out your options before contacting your insurance company. Contacting insurance companies about an issue can count as a claim on your coverage and impact your future rates even if you decide to take care of the problem yourself.
He said, “Your primary responsibility is to take reasonable means to mitigate any further damage to the building or property. So if you’ve hired a restoration professional, then you’ve acted reasonably. Just don’t unreasonably delay the process and be timely and communicative and keep good records.”
Keep Track of All Disaster Related Expenses
Throughout the recovery process, you also need to keep track of all peripheral expenses for your records, especially if you’re dealing with insurance claims. This doesn’t just mean tracking your actual repair expenses. You should also track things like the hours you’re paying employees to do cleanup work rather than their regular duties, food and water you’re providing for workers and sales that your business has lost during the recovery period.
Give Yourself Time to Recover Records
From there, you’ll need to get to work on recovering your records and getting back to your everyday operations. Even if you have backup records, getting re-organized can take time. So especially if you’re dealing with a disaster right around or before tax season, Miller recommends applying for an extension to give yourself some breathing room. The IRS often grants extensions to businesses that have been impacted by disasters. So this gives you more time to get organized while still dealing with all of the chaos that comes with recovering from a natural disaster.
Reach Out to Banks and Vendors
If you have lost any important records or missed any payments, Miller also suggests reaching out to your bank and your vendors to recover that important information. You can request virtual or hard copies of your financial records, contracts, invoices and other important documents. This should help you build up a pretty decent base of records. You can also work with your vendors to see about extensions for payments or payment plans to help you manage your expenses while you deal with recovery efforts.
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