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Disaster Preparedness: 40% of Small Businesses go out of Business After a Disaster

1/11/2018 (Permalink)

Commercial Disaster Preparedness: 40% of Small Businesses go out of Business After a Disaster Let SERVPRO help assist you in creating a disaster preparedness plan

It’s a harsh reality of opening a small business.  Most of the owners efforts are focused on the opening and consequent upkeep of their small business.  Many of them don’t find much necessity in focusing on more unlikely and uncontrollable disasters that can affect their business.  With this oversight comes a high cost; 40% of small business are never able to open their doors again after suffering a disaster (as reported by CBC & SurveyMonkey’s Small Business Survey). 

With the life changing altering consequences a disaster can have on any business, it’s important to be prepared in the event of a disaster.  It’s a case of “better to be safe than sorry”.  This is why it is important to have a ready-made plan to follow through with when confronted with the unexpected. Having a disaster readiness plan can’t always prevent a disaster from occurring but it can increase the chances that your business reopens, and stays open, successfully.

Do yourself a favor to prepare for a disaster now, to give yourself a greater sense of peace of mind in the future.  Here are five helpful tips to consider for all small business who are wanting to prepare for the unexpected.

1) Keep you Company Records in the Cloud

This one may seem obvious given our societies current reliance on electronic technology and the internet.  Though this doesn’t apply to all businesses; especially small businesses with tighter budgets.  Most cloud based services will give you a limited amount of space to use for free on their service.  This is great for newly started businesses or businesses whom are starting to transfer their information from physical copies to the cloud.  Once this storage is fully used then it’s time to consider buying more cloud storage.

Having all of your data stored to the cloud doesn’t mean you have to stop keeping physical records, instead it works as a safety net in the event of a disaster.   It also give you the ability to access all of this information from anywhere, not just your office. This is the one tip that is most versatile for all of the different things it can do for your business.

2) Have a Plan to Communicate to Employees, Vendors, and Customers

When preparing for a disaster it’s best to prepare for the worst case scenario.  If your physical location is out of commission make sure to have a separate plan to address all employees, vendors, and customers. The reason you have a different plan for each is because each set of people have different needs when dealing with your company. 

You should always address your employees first.  They should be properly trained and aware of how to proceed, otherwise they won’t be able to effectively communicate and help with all vendors and customers.  They are the foundation of your business and will be crucial to making sure business will continue as smoothly as possible during this turbulent time. 

Additionally, your employees will be wondering if they will be out of a job or if they need to worry about finding another source of income while the business gets up and running.  This can cause all employees to stress and lead to them leaving the company due uncertainty.  If they are well informed of what to do during a disaster this can not only put them at ease, but also make sure they still have work to accomplish, knowing they will still be able to get the money they need to provide for themselves and their family.

With vendors it’s important to contact them to work out an arrangement until you can get your business back on its feet.  This way vendors won’t send you products you can’t store, sell, or pay for.  The vendors will respect this and know that if they can work with you they can keep you as a customer, therefore working in both of your favors.  This can help grow your relationship with a vendor and help you during your comeback.

Lastly, it’s important to contact your customer and inform them of your situation.  No need to leave them in the dark and risk them going to a competitor.  Transparency is crucial.  Alert them as to how long and why you will be closed.  Additionally, this also means that you must alert them as to when your “grand re-opening” occurs.  Especially with your most best, most loyal customers you don’t want to leave it up to social media to alert them, you want to get in front of them as directly as possible.  If you put forth the effort for them, they are more likely to give you their word of mouth and business.

3) Develop a Plan to Keep Operations Running During the Repair Process

This step goes hand in hand with communicating with your employees.  Make sure all involved in your business are prepared to keep the business running.  If you have an online store, consider shipping any undamaged products or talking to your vendor and getting products drop shipped.  Finding creative ways to keep your business running while your physical space is getting repaired is important in not allowing your business to close.

4) Analyze Potential Threats

As stated earlier, it’s best to assess and prepare for all potential disasters.  When preparing, do be smart about what disasters you prepare for.  For example, in New Mexico, there’s no use in preparing for a hurricane but there is value in preparing for a fire, flooding, even tornadoes; these are some of the most common natural disasters experienced around the state.  So while it’s recommended you prepare for all disasters, be smart about where you are located and what type you prioritize.

5) Actively Practice Drills

Once a preparedness plan has been created and is ready to be put into effect don’t allow it to sit there and gather dust in a folder.  Train employees on exactly what to do and how to use the preparedness plan.  Once all employees have been trained and know their specific responsibilities, practice.  Practice implementing the preparedness plan much like a fire drill is practiced.  If people learn it once and don’t have to use it for years to come, they will forget what to do; making all of the hard work it took to create a plan for naught.

 It may seem unlikely and a waste of time, but in the unfortunate event that you need to use the plan, it can prove to be a business and job saver for many.

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