One in four businesses that close due to a disaster never reopen, according to Tampa's Institute for Business & Home Safety. Is your company prepared for the next gulf hurricane?
It's not just about putting up shutters. As experience from Hurricane Katrina shows, even businesses that suffer no physical damage can fail in the post-disaster chaos. Cash flow can dwindle if damaged roads and Internet outages prevent customers from transacting business with you. Work flow can slow if employees can't make it to your site. Critical supplies can get stuck on idled trucks miles away. If most of the population evacuates and doesn't return for weeks or months, who will your customers be?
To prepare for the worst, experts suggest five key steps:
1. Check your insurance policy. Is the amount of coverage sufficient? Does it cover damage from wind and floods? What is your deductible? Make sure you keep your policy number and agent's name and phone number inside your wallet, along with other key contact numbers
2. Ask your agent about business-interruption or hurricane insurance. Such policies typically cover lost profits and any extra operating expenses you might incur after a storm. They also can provide the cash you need to temporarily meet payroll or other obligations.
But be aware: Many policies pay out only if your business suffers physical damage. By contrast, the U.S. Small Business Administration offers post-disaster loans both for physical damage and indirect harm.
3. Develop a disaster survival plan and share it with your staff. What will you do if your business is cut off from customers, staff and suppliers? Could you operate indefinitely without electricity, Internet or phone service? Would it be possible to relocate your operations if necessary? Are your employees prepared to return to work after a disaster? As part of your plan, set up relationships with backup suppliers; buy a generator, portable air conditioner and battery-powered surge protector; store duplicate copies of your key documents and computer files at an alternate site; and install storm shutters or similar defenses.
4. Assemble a hurricane supply kit. Much like the one for your home, it should include bottled water and an ice chest, a radio, flashlights, batteries, duct tape, a first aid kit and sanitary supplies, canned and other nonperishable foods, emergency cooking supplies and utensils, a list of employee phone numbers and emergency contacts, and a camera to document property damage.
5. Make sure your own family is prepared. That includes familiarizing them with your post-disaster responsibilities at work.