In 2013, I was starting my second year of graduate school in Boulder, Colorado. As the semester began, the weather was grand; temperatures in the 70s and 80s coupled with the cool breeze off of the Rockies made for an exceptionally mild end to the summer. We appeared to be heading into Fall without incident until, quite abruptly, the city was hit with a torrent of rain. The incredible amount of rainfall directly over the city, coupled with the sharply increasing runoff from the mountains, caused the usually quaint Boulder Creek to flood over, its banks frothing with muddy water.
Flooding in Boulder Creek was hardly uncommon. It happened often enough that the city installed sensors further up the creek. If enough water came down alarms were triggered down in the city to warn of an impending flash flood. However, most of the time these alarms were just a signal to stop playing in the water until the flood had passed. I probably heard more tests of the blaring sirens than I did actual flood warnings, but when the water level outside of my door reached a few inches and the bridge that I often took on my way to campus was torn from the banks, I knew that things were serious. In the end, it seemed as though countless students and professors had suffered some sort of damage to their homes from the flooding.
The Daily Camera counted 33 damaged commercial properties and three that were destroyed completely. I was fortunate that the water never made it into my apartment, but we were constantly being told to have a disaster recovery plan in case things got bad. While a personal plan is important in case of a natural disaster, things can be even worse for businesses. A disaster recovery plan for your business can be the difference between riches and ruin.
Why a Plan Matters
What happened in Boulder was hardly an isolated incident. Eastern Kentucky University reports that one in three small business owners have been personally affected by a natural disaster. According to Boston University 60 percent of businesses don’t have a plan to respond to these disasters. These numbers paint a frightening picture of businesses that are both susceptible to serious damages from a natural disaster and woefully underprepared for what might happen. However, with a solid plan behind you, any storm can be weathered. Here’s what to consider as you make your own plan.
Making a Business Recovery Plan
There are many ways in which a disaster can affect your business. Here are some things to consider.
The most obvious way that a natural disaster can harm your business is by destroying your stuff. More specifically, destroying or damaging your building, your equipment, your vehicles, and other things. These objects represent an amount of upfront spending that many businesses can’t survive having to make twice. That is to say, you already put all this money down, and you probably can’t afford to put it all down again. To avoid this situation, insure what you can. Tools and buildings that are properly insured will be much less painful to replace. If you haven’t yet made some of these upfront purchases, think about doing so in a way that protects you from likely disasters in your area. In Boulder, this could have meant leasing a storefront further from the river or building your office slightly above ground level to protect you from flooding. It’s up to you to make the right call here depending on what sort of disasters you’re likely to face.
Your clients keep you in business, but if they’re unable to reach you or lose interest in your services because of a natural disaster, you’ll suffer a huge blow to your revenue. The effects of natural disasters on consumers can actually be quite varied from business to business. After the flooding in Boulder, clean-up companies and specialists in home repair were getting more calls than they could handle and doing more business than ever. However, not every company is so lucky. If you deal with customers remotely, then you probably won’t lose too much business, but if you depend on local clients, you could be in trouble. Consumers may either be too busy to call upon your services or out of money, having spent much of it on necessary services to restore their own lives. To mitigate these losses, you may be able to get tax assistance proportionate to the damage you’ve suffered. For example, in Canada you can waive late fees on your taxes if you’re prevented from filing due to a disaster. Insurance can also help to recover lost revenue.
One thing that many businesses don’t consider is how the loss or destruction of records might hurt them in a natural disaster. Consider this: without a record of the value of your lost services or your damaged equipment, any claim of reimbursement that you make will seem completely unfounded. If you haven’t already, backup your data to the cloud to ensure that it stays safe no matter what happens to your physical location. A natural disaster can ruin a business in the blink of an eye, but with a well-thought-out recovery plan you can ride through the worst of the storm and come out in good shape on the other side.
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