How to Prepare Your Business for a Natural Disaster in 2019
A disaster often happens over just a few hours, but the effects can echo in a community for years. According to FEMA, almost 40% of small businesses never reopen their doors after a major event like a flood or a hurricane.
Planning for a natural disaster doesn’t have to cut into your profits, though, and many strategies for disaster preparedness protect your business’s bottom line. By developing a disaster preparedness plan, you can keep your employees safe while ensuring that your business stays afloat through anything Mother Nature has to throw at you.
Step 1: Address Safety and Security
Your business’s most valuable assets are its people. Keeping your employees and yourself safe should be your top priority when developing an emergency preparedness plan. Have a plan of action and train for a disaster—and the cleanup after—to limit your liability, risk to your staff, and any lost productivity.
Evacuation Plans and Safety Equipment
At a bare minimum, make sure that your business has an evacuation plan and all appropriate safety equipment. All employees should have the chance to practice the evacuation plan; a drill will help people take decisive action under pressure.
Tips:
- Make sure you routinely check all safety equipment, like fire extinguishers and first aid kits, and have it readily available.
- Practice your evacuation plan and emergency response protocols ahead of time to ensure your staff can act fast in the event of a disaster.
- Review your emergency preparedness plan with all your employees, and keep a hard copy readily accessible.
- Maintain an active list of emergency contacts for all employees as part of a post-disaster communication plan.
- Create a plan for your business to operate remotely (if possible) in case it’s unsafe for your employees to commute after a disaster.
Customize Your Plan
Every disaster is different. Check to see what natural disasters pose a threat in your immediate area, and tailor your emergency preparedness plan to those events. The U.S. Small Business Administration maintains disaster checklists tailored to common natural disasters.
Tips:
- Look up your small business’s location on FEMA’s flood map database to see if you’re within a federally designated flood area.
- Prepare for long-term effects after disaster hits. Cleanup can pose numerous safety and health risks, so consult your local fire departments or hazmat teams and plan for things like mold, fire damage, or hazardous materials cleanup.
- Assess your local area for off-site risks that may affect your business during a disaster, like blocked shipping routes.
Step 2: Upgrade Your Technology
You can make several simple tech upgrades to improve your business’s resilience to a natural disaster. Leveraging technology to improve your response to a disaster, large or small, can turn a catastrophe into a minor inconvenience.
Smart Security Systems
Your business likely already has a security system to prevent break-ins, but this system may do much more to protect you from loss. Today’s newest security systems use advanced sensors to detect things like flooding, smoke, fire, carbon monoxide, or variations in temperature, which can help you detect potential disasters. An early response to a flood or fire can save your business thousands of dollars, making this upgrade extremely cost-efficient.
Tips:
- Strategically place additional flood sensors to protect key assets. A flood sensor on the lowest floor of your business gives you an early warning for preventing catastrophic water damage.
- Use temperature sensors to help prevent frozen pipes by alerting you if your heating system fails.
- Consider investing in a monitored security system for quicker response times—a monitoring service automatically alerts emergency services when a sensor is tripped.
Information Security
Your company’s records, client data, and important files are all essential to your business’s survival. If you lose these critical documents and files in a disaster, you might find yourself forced to shutter your business. Preventing this kind of catastrophe makes good business sense, regardless of your disaster risk.
Tips:
- Back up all your company’s essential data to a secure private cloud server. Many hosting websites offer additional layers of security for business owners, and cloud servers guarantee the safety of your essential files in the event of a disaster.
- Keep all physical documents in raised file cabinets to prevent flood damage. Store documents in a second or third-floor office, if possible.
- If wildfires are a risk in your area, find a fireproof safe to secure your most important documents.
- Digital documents can also make relocating your business much easier if your office is temporarily unusable.
Step 3: Insure Your Assets
Preventive measures provide some protection for your business, but you’ll never be able to plan for all possible scenarios. Some disasters occur with a magnitude that surpasses basic preparedness plans. For these scenarios, a full-coverage insurance plan can keep you afloat until it’s time to rebuild.
Insurance policies differ based on your location, risks, and business assets. Most policies are limited in their coverage, and your current policy may not fully protect you from a natural disaster. It’s important to read through your policy closely. Lost profits due to closure or staffing issues when employees lose their homes and have to relocate are just a few of the situations that may not be covered under a traditional policy.
Tips:
- Have a lawyer or industry professional analyze your insurance coverage to ensure that you understand exactly what all is insured.
- Look into establishing a “captive” insurance company, which allows your business total control over risks and coverage.
- Purchase additional protections to smooth any interruptions after a disaster strikes. Extra Expense Coverage can cover the cost of generators if the power is out, and Business Interruption Coverage gives you a grace period to restore your normal operations.
- The U.S. Small Business Administration provides additional disaster assistance funding that can supplement your insurance. It can be used to cover physical damage as well as operating expenses.
Step 4: Strengthen Your Network
Disasters can shake communities to their core, and your business can play a key role in helping to restore normalcy after a natural disaster. You can provide a number of benefits in the wake of a disaster by networking with other local businesses, emergency services, local residents and customers, and local governance beforehand. Often, the businesses that survive a disaster are the ones that coordinated with other local entities.
Consider coordinating your emergency preparedness plan with local emergency response networks. You might provide your building, warehouse, or offices as temporary staging areas for disaster response, or as a safe evacuation area for nearby residents. Helping your community bounce back faster will quickly restore your normal business operations, and your contributions to your community’s resilience will build a strong bond with many local customers.
Finally, take the time to address your business’s key partners. Often, businesses that are left unscathed by a natural disaster will still be unable to operate amid power outages, supplier issues, or damaged transportation networks. Look for vulnerabilities in your supply chain, and build relationships with alternative sources of key materials before a natural disaster causes a crisis.
Tips:
- Talk with local emergency planners to find out what relief programs and resources are available to your business in the event of a disaster.
- Many communities provide free consultations for things like Hazard Identification and Assessment protocols. Talk with your local planning department to see which programs your business qualifies for.
Conclusion
Investing in disaster preparedness doesn’t provide an immediate return, which can cause small-business owners to neglect many aspects of their contingency planning. Avoiding catastrophic loss makes risk management essential, and the costs associated with disaster planning are minimal compared to the costs of rebuilding your business from the ground up. Don’t let your business be a cautionary tale in the wake of the next big calamity; take action today and invest in your future.
