Disasters happen whether you're prepared for them or not.
Over the past several years, hurricanes, floods, earthquakes and other catastrophic events have devastated entire regions, leaving crumbled debris and scores of broken lives in their wakes.
According to a recent study by the Insurance Information Institute, more than 40% of the SMBs that have been affected by these disasters never recover. As a small business owner, the high rate of post-disaster business closures should be a wake-up call to prepare your business for recovery before a disaster occurs.
Although it's unlikely that you'll ever need to use it, the preparation of a comprehensive and updated disaster recovery plan is a necessity for any business committed to effective leadership and long-term survival. Since decision-making can be compromised in the middle of a crisis event, your business's disaster recovery plan should address immediate response actions as well as a list of tasks and resources for the days and weeks following the disaster.
Here are a handful of other suggestions to help get your SMB back on its feet as soon as possible:
- Maintain cash reserves. Cash reserves are a good idea for any small business. But in the days following a natural disaster, your cash reserves will carry your rebuilding efforts until you receive payment from insurance companies or government recovery programs.
- Connect with federal and state agencies. Government agencies and organizations like FEMA and the Red Cross are integral players in disaster recovery. In many cases, special assistance and will be provided to help your business recover, but you'll need to make connections with the right agencies to initiate the application process.
- Network with competitors. In a disaster recovery situation, competition often takes a back seat to mutual concern and assistance. By networking with competitors before and immediately following a natural disaster, you speed up the recovery process not only for your business, but for the entire community.
- Stay in touch with your employees. A natural disaster doesn't just disrupt your business – it also disrupts the lives of your employees. Even if your workers' homes emerge from the disaster unscathed, the prospect of losing their livelihoods will weigh heavily on your workforce. As a responsible business owner, it's imperative to check up on your employees after a disaster and maintain clear channels of communication throughout the rebuilding process.
- Establish community relationships. Good SMBs are responsible members of their local communities. When disaster strikes, community members pull together and help each other rebuild their lives. Businesses with strong community relationships often benefit from community goodwill during the recovery phase. At the same time, these businesses become anchors for families and other businesses in the area.