For Small Business, Natural “Disaster” is Quite Apropos

If you are a small or micro business, pretty much every crisis can potentially be seen as an emergency, as small businesses often have very small profit windows and very little retained earnings to cover for one of these “emergencies.” These small operations and sole proprietorships jump right past crisis or “situation” and straight into panic mode.

And among these incidents that may qualify as an “emergency” in most businesses is a natural disaster such as a tornado, hurricane, or flood. Even a robust, relatively large local business can be hit hard and suffer at least some level of temporary loss from a natural disaster. Some of those business can survive, but very small business usually cannot without proper preparedness in the form of a business continuity plan.

This issue was addressed in a recent Professional Safety magazine article by John Swanciger, CEO of Manta. For the article, he cites the results of a recent Wellness Index survey, 37 percent of all business owners surveyed (read: all sizes) were not prepared for a natural disaster and may not survive the other side of it. Doing  the math, if 80 percent of all businesses are small businesses, this potentially means that nearly half of all small businesses may not be equipped to survive a natural disaster.

Here’s hoping that not many of those business are located in California, Alaska, Texas or Florida.

Anyway, it is certainly quite imaginable that something like a hurricane, earthquake, or flood could do devastation to a small or micro business. Every day that a business is closed is a day that it does not make money, and if and when there is damage to the business property or files or power or cell phone service, that business will be out of commission for days or even weeks after the disaster itself is over. While many business may have insurance to cover the expenses of such an event, it doesn’t do anything to make your business whole again in terms of operations and re-connecting those relationships with clients and vendors.

With the idea of an “emergency” being very real and plausible with small businesses, Swanciger  uses the Wellness Index survey as a springboard to talk about business contingency plans and their importance for the survival of small business on the other end of a disaster, especially a natural one.

Swanciger wrote that businesses that survive have a contingency plan that involves prioritizing and communicating, and having a plan set up before a disaster occurs. A contingency plan should include the owner prioritizing in order the business operations that should and can be restores first to keep the business running.

As that is established, a communication system should be established so that vendors, clients or customers, other employees and other important stakeholders are contacted as soon as feasible to give updates on the business and its progress.

The plan could be executed by several people, but if the business isn’t even that large, then being able to have at least the most recent and available contact information (cell phone number, e-mail address, home address, etc.) so key information can be relayed quickly through group messaging or mass e-mail notification.

The key point is that the business could be put back together after an emergency through insurance policies, but to keep the business truly going, it is about relationships and communication, and having a contingency plan to account for various types of disasters is especially important for those business that may be one disaster away from closing their doors forever.