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SCORE Small Business Talk: Update Your Disaster Plan
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September 2, 2022
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June 1st is the beginning of hurricane season in our area. In addition, our area is susceptible to tornadoes, floods, and wildfires. A disaster of any size could have an impact on your business. A broken water line, a fire in the building, or an interruption in the electrical service could all lead to you having to shut down your business for some time. According to FEMA, 40% of businesses never reopen after a disaster, and for those that do, only 29% were still operating after two years. Those that lost their information technology for nine days or more are likely to file for Bankruptcy within a year.

It is important to consider how a disaster could affect your employees, customers, and workplace. How would you manage your business if access to the workplace is limited by road closures, streets are impassable, or communication is limited? Every business needs to have a business contingency plan, a plan to stay in business after any disaster. This plan should address the operations that are essential and time-critical to the business. Use flowcharts for all the operations in your business and examine alternatives. This is important even if you are the only one in the business, plan for what you would do if you couldn’t do things the way you always do them.

Prepare a go box that you can reach for and take with you if you need to evacuate your business. This is important whether your business is a storefront or the back bedroom of your house.

First in your go box should be copies of your insurance policies. Be certain of the coverage you have and any deductibles that apply. Know what the insurance company will need to support any claim you may have to make. Take pictures now to document how your business looks during normal operations. Take pictures of equipment, inventory, office equipment, and anything that is important to the operation. Have a camera in your go box so you can document any damage that may have occurred.

Include a contact list containing the contact information for your employees, your insurance agent, suppliers, vendors, key clients, or customers. Also, the number to your voice mailbox and the password.

Have a copy of the latest P&L statement, Balance sheet, Cash Flow report, inventory list, and AP & AR reports. Include bank statements for checking, savings, credit cards, loans, or lines of credit. Save three years of tax returns. These would be important if you need to apply for emergency loans.

Electronic backup services are very popular, however, after a disaster, there may be some difficulties with electrical service or internet access to retrieve these records. Time will be of the essence.

After a disaster, connect with the local chambers of commerce, economic development organizations, and other community support organizations. The Florida Small Business Bridge Loan Program may be activated by providing short-term, interest-free working capital loans. FEMA and the U.S. Small Business Administration (SBA) also provide low-interest, long-term disaster loans to businesses of all sizes to provide working capital and repair or replace damaged property.

Remember, before, during, and after any disaster safety is the main priority.

Let’s hope we never have to use these resources or our go boxes but, be prepared just in case.

Let me know your thoughts at eddavis@scorevolunteer.org.

For more information and assistance with disaster planning, request a mentor from Port Charlotte SCORE at www.portcharlotte.score.org. Volunteers provide confidential business advice to meet the needs of both start-up and existing entrepreneurs at no cost. To learn how you can become a SCORE volunteer contact Nils.Weibull@scorevolunteer.org. Follow us on Twitter; @charlottecscore

 

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