Is Your Small Business Prepared for Disaster? -
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Is Your Small Business Prepared for Disaster?

If disaster struck tomorrow, what would happen to your small business? A study last month by Merchant Cash and Capital found that almost one year after Hurricane Sandy—which shut down more than 40 percent of small businesses in the affected area–nearly half of small business owners surveyed still don’t have a disaster preparedness plan in place.

According to the study:

  • When Hurricane Sandy struck, nearly two-thirds (64 percent) of those affected by the storm report they were caught off guard. Just 22 percent already had a storm preparedness plan in place, while 14 percent rushed to make last-minute preparations once they heard of the pending storm.
  • 64 percent of respondents didn’t have a storm preparedness plan in place before Hurricane Sandy. As a result, 43 percent of respondents incurred damages and had to temporarily close their businesses, causing 46 percent to lose revenue. Nearly 15 percent of those who lost money say that loss was “substantial.” Of those who closed, 44 percent just closed for a number of hours, but 45 percent were closed for several days of more.
  • A whopping 88 percent lost power and Internet service; as a result, nearly 20 percent lost business data.
  • After Sandy, nearly 40 percent of the businesses surveyed report they put a storm preparedness plan in place, while another 16 percent are working on a plan. However, nearly half (46 percent) have chosen not to create an extreme weather plan.

Of those who weren’t affected by the storm, 33.7 were simply lucky—their businesses were outside of the storm’s path. You might not be so fortunate when extreme weather strikes. How can you protect your business?

  1. Determine what type of extreme weather is most likely to affect your region, whether it’s fires, floods, hurricanes or earthquakes, and consider what the possible results could be, such as lost power, inability to access your business location, etc.
  2. Start with safety and develop a plan for getting employees and customers safely out of your location should disaster strike during business hours. Set up a communication plan such as a phone, email or text message tree to alert employees and make sure everyone is accounted for. Stock your business with emergency supplies.
  3. Next, focus on keeping your business equipment and data safe. Make sure your critical business data is backed up and stored somewhere outside your business (and, ideally, outside your geographic region so your backups aren’t affected by the same event). Think about where critical equipment is housed—for example, during Hurricane Sandy, many businesses and hospitals found that putting computer servers in a basement isn’t a good idea.
  4. Finally, figure out how your business can continue operating despite a severe weather event. In most cases, this will involve employees working from home, so make sure your team has the equipment, knowhow and access to data that they’ll need to keep your business running smoothly.

The SBA website offers information and resources to help you develop a disaster plan for your business. Visit the SBA website for more information.

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Karen Axelton

Karen Axelton

Karen Axelton is Chief Content Officer of GrowBiz Media, a media company that helps entrepreneurs start and grow their businesses. Visit her company’s blog at
Karen Axelton

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