NOTE: As hurricane season is upon us, we thought it worthy of sharing this reminder.
Small businesses dealing with the aftermath of a natural disaster face a variety of challenges. In many towns and rural areas, these local establishments are the lifeblood of the community. When these businesses are engulfed by fires, damaged by floodwaters, or destroyed by high winds, the impact on the local economy is devastating. More than 500 businesses were damaged or destroyed during the Camp Fire in Paradise, California. Even those businesses that survived untouched temporarily closed and lost sales because of the fire.
According to research conducted by Dun & Bradstreet and Pepperdine University, natural disasters had a significant financial impact:
- 30 percent of businesses made late payments after the disaster
- 18 percent of owners applied for additional financial assistance
Natural disasters result in unexpected expenses and may require businesses to prioritize their ongoing financial obligations to reopen. Payments can include rebuilding costs, clean-up, delayed shipments, and loss of sales. Here are steps companies can take to get back on track after a natural disaster.
Apply for Assistance from the Government
Several agencies of the federal government are available to assist businesses that natural disasters have damaged. Help can be offered in the form of home and property loans, economic injury loans, emergency loans (farm and military reservists), or tax assistance. Businesses can contact one or more of these organizations to decide their best options.
- Federal Emergency Management Agency (FEMA)
- The Small Business Administration
- The U.S. Department of Agriculture
The federal government may declare a town, city, or state a disaster area when damage is widespread and severe and many people are impacted. Owners should also check for assistance programs that state and local governments may offer.
Review Your Emergency Preparation Plan
As mentioned in a previous article, every business should create an emergency plan to cope with natural disasters. The project will include a contact list, every employee’s role and responsibilities, and the steps they must take to get the business up and running again. Start by contacting professionals who can correct any damage to the facility. These can include debris removal, electricians, plumbers, or contractors. It’s essential to practice safety by avoiding hazards such as electrical lines and gas leaks.
Be Ready if Business Gets Slow
It will take time for sales to return to the same levels before there was damage to the establishment. Sometimes it requires operating on a shoestring budget with fewer employees. These are critical decisions that must be made quickly based on individual circumstances. Identify those employees who should come in to assist customers or those who can potentially work from home. Work with vendors to delay shipments to avoid stocking excess inventory while rebuilding. Review every option to determine which ones will help rebuild sales and provide customers with the best service.
Support and Advise Employees
Some of your employees will have difficulty accessing services or returning to work soon after a natural disaster. People may also experience power losses during a fire or storm and are unable to contact their employers. Be prepared to support your employees and communicate with them as soon as possible. Watch for emergency alerts on your phone or other devices to stay informed about the situation.
Communicate with Customers
When businesses temporarily close due to an emergency, customers purchase goods and services elsewhere. However, that does not mean businesses must permanently lose their patronage.
In natural disasters, loyal customers are understanding and are likely to return in the future. To maintain these critical relationships, owners must reach out to customers on social media or contact them directly to provide regular updates about progress related to the recovery. Let the community know when you plan to reopen and invite customers to visit on a specific day.
Help the Community Recover
Home improvement stores and local businesses are held in high regard by their neighbors for helping communities recover after disasters have struck. Offering financial assistance, attending events, offering helpful, and sharing resources are positive contributions that build long-term relationships. Many owners are natural leaders who take charge in a crisis.
Creating a recovery plan enables owners to prioritize tasks and manage challenges that are instrumental to rebuilding the business. It’s hard to predict the level of destruction resulting from natural disasters. However, having a roadmap in place will make it easier to operate if your business must travel this unpredictable road in the future.