Protect Your Business with These Simple Steps to Creating a Disaster Recovery Plan

The U.S. Small Business Administration (SBA) Can Help

No one is immune to disasters, whether natural or man-made. From wildfires to floods and pandemics, disasters can have a devastating impact on businesses, causing financial losses and even permanent closure. In fact, history has shown that 25 percent of businesses that close because of a disaster never reopen. The COVID-19 pandemic alone resulted in tens of thousands of small businesses closing their doors for good.
The golden rule for disaster preparedness is to increase awareness, develop action plans, and practice them. Now is the time to create a useful disaster recovery plan for your business, and the U.S. Small Business Administration (SBA) can help. Here are some simple steps you can take to protect your business in case of a disaster:

1. Review Your Business Insurance Policy
   Review your business insurance policy to determine what is covered and what is not. Most business policies do not cover flood damage, so make sure you have adequate coverage for your property and inventory. Consider purchasing business interruption insurance to cover operating expenses if you’re forced to temporarily close. Also, review your policy to ensure it covers business shutdowns caused by events like pandemics and other health emergencies.
2. Establish Relationships with Alternate Vendors
   Develop professional relationships with alternate vendors in case your primary supplier is not available. Place occasional orders with them to ensure they regard you as an active customer. Create a contact list for important business contractors and vendors you plan to use in an emergency. Keep this list with other documents in an easily accessible place at a protected off-site location.
3. Create a Crisis Communications Plan
   Create a crisis communications plan to communicate with your staff, customers, vendors, and contractors following a disaster. Secure primary and secondary email addresses for your contacts and make sure this list is updated regularly. Utilize social media channels to provide real-time updates to your customers and community about the status of your business.
4. Protect Your Inventory
If you sell goods, art, innovative technology, or manufactured products, your inventory may be your most valuable asset. Have a plan to relocate your most valuable inventory during an emergency. Your inventory can also be your data, so ensure your business data is secured in the cloud and backed up on a removable storage device that is grab-and-go.
5. Get Help from the SBA
   Following a declared disaster, the SBA helps rebuild communities by providing affordable, timely, direct loans to businesses of all sizes, nonprofits, homeowners, and renters to cover uninsured losses. Developing a workable disaster recovery plan is critical for all entrepreneurs and homeowners. For more information on SBA’s disaster assistance programs, visit www.sba.gov/disaster and follow them on Twitter @SBARockymtn.

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