Did you know that this past September alone, Hurricane Florence’s landfall in the Carolinas led to over $10 billion in economic losses?
In 2017, natural disasters cost the U.S. economy a record $307 billion. Wildfires and hurricanes set new damage records, and while tabulation on the total economic impact of natural disasters for 2018 is yet to be tabulated, given the wildfires currently raging in California, 2018 figures will likely meet or exceed losses in 2017.
In 2017, 16 events cost more than $1 billion each. These disasters also included heat waves, earthquakes, tornadoes, floods, droughts, and tsunamis. In the short term, they cost homeowners and businesses billions.
In the long term, the largest disasters can slow regional economic growth for decades. Bridges, roads, and utilities are destroyed. Homeowners who aren’t covered by insurance go bankrupt. Many can’t rebuild and must move elsewhere.
According to the Institute for Business and Home Safety, based in Tampa, Florida, “…at least 25 percent of businesses will close after a natural disaster and never reopen.”
Here are some other sobering statistics, according to the American Red Cross:
• 15% to as many as 40% of businesses fail following a natural or humanmade disaster.
• 94% of small business owners believe a disaster could seriously disrupt their business within the next two years.
However, it does not take a major disaster to impact your business seriously. Even a loss of power that shuts down your phone systems or order processing for a day or so could lead to incalculable lost revenue. It is imperative that all business owners, but especially those small business owners in areas prone to certain natural disasters such as hurricanes, earthquakes, or wildfires, have disaster preparedness and recovery plan in place.
Have a Plan
Of course, keeping your business afloat during a flood or other natural disaster takes a back seat to keep your home and family safe, but the fact of the matter is, worldwide, natural disasters seem to be on the rise. Taking the time now to have a proper risk management plan can make all the difference in minimizing negative financial impact on your business.
Of course, the safety of yourself and your staff is of primary importance should an emergency occur during business hours. Every business location should have an evacuation plan for personnel and customers. This means more than knowing where the emergency exits are located. You need to designate someone to be in charge of communicating with employees and customers, and implementing your evacuation plan in a calm and orderly fashion. Many businesses find it helpful to bring in an expert for some additional training or hold workshops to discuss what to do in case of an emergency. This can cover everything from crowd control techniques to basic first aid, to how to work with emergency response teams.
IT and Communication
Once you know you have a plan for your people, the next most important thing is your communications and records. Make sure all employees keep their cell phones charged. This may seem like a “no-brainer,” but most people do not charge their phones until the battery is almost dead. Cell phones can be the only line of communication in a disaster. Keeping cell phones charged, and even having an extra battery or two, is a great way to make sure phone communication stays open. Have a phone chain for employees to pass along vital information to one another.
Another recommendation is to have a backup cloud-based or virtual PBX system that can be used to route calls to different phones and store voicemail messages. Are your servers backed up? Off-premises or cloud computer servers are the best way to make sure that vital records and emails are maintained in the event of a fire or other disaster that destroys your building and to ensure that you will still have internet access.
And finally, stock up on supplies. Think of what you’ll need to stay functional for at least a week or two. In the days or weeks following a flood, hurricane or another natural disaster, you may not be able to get to retail stores or receive any deliveries. Do you have the supplies you need to keep it business as usual? Now is the time to make sure an adequate supply of everything from bottled water to office supplies, and postage stamps are in your stockpile.
A disaster preparedness plan for your business is one of those things that you have but hope you never use, rather than need and wish you had. Proper disaster planning can go a long way to giving you the peace of mind that comes with knowing that your business is ready, willing, and able to shift into disaster response mode, whenever it may be necessary.