8 Ways to Stay in Business After a Disaster

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May 16, 2016

It is estimated that 25 percent of businesses fail to reopen after a major disaster. Developing a solid recovery plan will give your business a chance to bounce back. There are additional steps you must take to ensure your plan is effective. You will need to evaluate your insurance coverage and train employees before disaster strikes. The following information will help you create the right plan for your business. If you need assistance preparing for or recovering from a disaster call your LegalShield provider law firm.

  1. Understand the most common threats to your business. Many disasters are difficult to predict but you are probably more likely to encounter certain types of disasters based on where you live. For example, if you run an online business you may be more likely to experience a data loss or cyber extortion. If you live in a coastal region you may be more likely to face a major storm or flood damage. Consider the types of disasters you may face and take particular care in how to protect your business and recover your business.

  2. Develop a disaster recovery plan. Your first priority is the safety of customers and employees. Your plan should include evacuation or shelter-in-place guidelines in the event of a disaster. You should develop a plan for communicating with employees, customers and vendorsduring and after a disaster. You will also need to identify your critical business functions and set a plan for getting them back online. Your plan should be a path towards temporary short-term recovery and ultimately sustained long-term recovery. Keep copies of the plan, both physical and electronic, in multiple locations. Review and revise your plan every year or whenever your business undergoes major changes.

  3. Train employees on your disaster plan. Your plan is useless if your employees do not know what to do. Everyone in your business should understand his or her role in the recovery process. Train all new employees and periodically review procedures with existing staff. Personally manage the most vital recovery aspects or assign them to your most trusted employees.

  4. Familiarize yourself with IT threats and back up your business data. Read our previous article “Are You Ready for a Cyber-Attack?” to learn more about the threat of a cyber-attack and how to prepare. Use offsite computer backup and storage to make sure all of your vital data is recoverable in the event of a cyber-attack or natural disaster. Keeping your data in only one location is asking for trouble. Offsite cloud backup allows you to easily retrieve your data if your main office or data storage is destroyed.

  5. Evaluate your business insurance. Not all business insurance covers natural disasters and some types of coverage can be prohibitively expensive. It is important to consider the needs of your business and the likelihood of a disaster affecting your business. You may also consider purchasing data breach insurance, which may provide coverage if your business is hacked or your systems are sabotaged. The loss of client data could be a public relations nightmare and may lead to fines or expensive litigation. 

  6. Review your lease and talk to your landlord. If your business rents office or retail space it is important to understand the responsibilities of the landlord and their plan for recovering from a disaster. 

  7. Talk to your vendors. Without key vendors many businesses would quickly sink. You should keep an open line of communication with your vendors and understand their own disaster recovery plan.

  8. Make sure you have access to the necessary capital to recover. Many businesses fail after a disaster because they do not have the money to make it through even a brief shutdown. If your business needs assistance after a disaster you may be eligible for a short-term low interest business recovery loan. Learn more about disaster recovery loans by visiting the Small Business Administration website.


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Phil Liso, Contact
(562) 322-7376