How to Prepare Business Startups for Disasters?

Disaster preparedness should always be on the priority list of business start-up owners. Unfortunately, not all entrepreneurs out there seem to understand that everything can disappear in a matter of seconds during the onslaught of a powerful hurricane or tornado or floods.

The latest Small Business Disaster Survey showed that 74 percent of small businesses in the United States do not have recovery plans in case disasters damage a portion of the company. What’s more surprising is that 84 percent of small businesses do not have natural disaster insurances, and that 71 percent of these companies do not even have generators.

The possible cause of this phenomenon is the fact that around 76 percent of small business owners in the United States have never been affected by a major natural disaster. And while it is reassuring that not everyone is going to be devastated by a hurricane or tornado in the next few years, the reality is that the number of major weather events that hit the country is continuously going up.

Data from the National Oceanic and Atmosphere Administration showed major weather events (those inflicting damage of at least $1 billion) has increased from around two per in the 1980s to around 10 per year in 2010. More alarming is the data showing that 65 percent of businesses operating in the US are located in areas that have a high risk of getting ravaged by a natural disaster.

With this, it is only fitting for small and large business owners to invest in good disaster recovery plans to mitigate the possible harsh effects of natural weather disturbances to the companies. Some believe that “disaster recovery plans” are unnecessary expenses for businesses that need to limit its financial burden in order for it to survive. This is not a true claim.

Creating a plan does not need a lot of money. In fact, business owners can develop their own using information that they can get from the Internet or other sources. Planning does not have to be very extensive, but rather a concrete precaution in case of disasters.

Such plans should include the creation of back-up files in strategic locations in case a disaster destroys the original ones in the main office. Having a back-up power source is also a good idea, especially for businesses that rely on technology and machinery.

An alternative “home base” must also be established or conceived in case the main office becomes unavailable due to disasters. The plan should also talk about basic evacuation plan for employees in case an abrupt disaster strikes while everyone is in the middle of production.

No one wants to experience a disaster destroying his or her business. However, having a plan to address this issue is always better than having nothing at all.

More detailed information and useful advice can be found at Funded.com Created by Mark Favre, it offers expertise and assistance with developing and funding your concept, including a private forum for queries and discussions. If you need access to investors and funding providers, please do check our website. Funded.com

 

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12 Replies to “How to Prepare Business Startups for Disasters?”

  1. This is a great post and this can even prevent losses in your own home. I hear so many people complain that they lost everything in a fire or flood, ect but they didn’t take the time to invest in an insurance policy, especially renters. When you start a business it is important that you check into renter’s insurance to cover any damage, theft, disasters, or things beyond your control. I realize that people starting a business might not be able to afford coverage but policies are worth the expense. Most people don’t have thousands of dollars to replace damaged equipment, stolen items, ect.

    As an IT professional, make sure that you have a data disaster recovery plan. Find a back up solution that works for your company. You can use tape drives, external hard drives, and cloud storage to back up your important data. If you use a tape drive, it is best to have a minimum of three tapes. You want one for the current data, a back up on site stored in a fire proof safe, and a third copy stored off site. It is easier to recover a week or two worth of data than to be without a starting point, especially financial data.

  2. completly agree! You never know what can happen and there needs to be a backup plan. In NY last Oct. we were crippled by Super storm Sandy, power was out for over a week! Allt he datacenters were flooded… lucky we had a redundant server in the midwest that kept us going.

  3. Wow. Those numbers are staggering. I think it is important, even for online businesses to prepare for disasters. You never know what can happen and how it could hurt your business if you are not prepared!

  4. Gee, this is amazing. Life in the desert is quiet compared to the disasters suffered around the country. We don’t really have flooding (ok, every hundred years or so) or snowstorms or wind. But we deal with the heat, which is a different kind of issue, because it impacts our ability to deliver fresh flowers (which we never leave out on a porch) before it gets to be 100 degrees or so. I have learned to back-up data (learned the hard way) and rely on friends and relatives. Having a “plan” is the best plan.

  5. I hear it all the time “we lost everything”. But, did they heed the warnings? Did they prepare a plan … just in case? It’s hard to feel sorry for those who ignore warnings, advice and guidance to help them not suffer from the consequences of disasters.

  6. Informative post! It is indeed essential for every business to have natural disaster insurance. What comprises the best natural disaster insurance policy?

  7. Super tips! I’m sure most entrepreneurs don’t even think of something like this happening. We keep our stuff tight like Fort Knox, haha… we’ve got backups, then more backups, then online backups, etc…. It’s really VITAL… you can’t just think ‘that will never happen’ it’s better to be prepared for ‘just in case’ 🙂

  8. I was a partner in a young Miami manufacturing business that was hit by Hurricane Andrew, a Category 5 storm, just as it was starting to gain momentum. We DID lose most everything because the winds tore the expansion material out of the flat roof and made a swimming pool of it each time it rained. No corner of the operation was dry; every piece of production equipment, all inventory, all the packaging, every file folder got soaked. We had all forms of insurance, including business continuity insurance, so we were covered financially. What we couldn’t cover, however, was the loss of heart as we thought of starting the long uphill climb all over again: we had failed to meet all our year-end orders with new major clients and they didn’t care why we didn’t deliver. Next! 😉

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