Business owners must prepare for the worst

Business owners must prepare for the worst
By Joyce M. Rosenberg

Associated Press

NEW YORK – Tornadoes and flooding in the Midwest and South are painful reminders to small businesses about the need for disaster preparation.
Disaster prep can include reinforcing your building, putting inventory on pallets, and keeping a supply of plywood on hand. It also means being sure data including financial ledgers, customer lists, and product information are backed up. And it means thinking about how to stay in touch with employees and possibly get them working remotely.

Figure out what you can and cannot do: If you have a manufacturing business or a retail store and it is damaged in a disaster, you’ll likely be shut down until you can clean up and repair your premises. You can get yourself up and running faster if you think now about what you’ll need to do.

That means knowing whom you’ll call for repairs and contacting them now to be sure you’re on their priority list. It means knowing which companies you’ll order replacements from.

If you have a service business and your employees can work from home, you can set up a virtual workplace. But again, everyone needs to know now how to get work done.

If you have staffers who have only dial-up service in their homes, it is time for them to get high-speed service, even if you have to pay for it.

You will also need to be sure you have the technology to support working from home. That means you have a server off-site or use a Web-based service.

If your office is destroyed, and that is where your server is, no one will be able to log in. You want to have your data backed up off-site, too. Those servers need to be hundreds of miles away, not down the street, where they can be knocked off-line by the same disaster that hit your company.

You also need to be sure you have duplicate ways of getting things done. If your Internet provider is down, have a backup ready. Have multiple ways to get in touch with staffers.

Reassess your insurance: Having enough property and casualty insurance is critical. Many owners cut back on coverage when their cash flow was tight during the recession. But if your business is doing better, do not jeopardize your future by skimping on your policy.

Don’t assume you are covered for floods and earthquakes: Chances are, you are not, unless you purchased a separate policy. The standard business owner’s policy will cover you for fire and wind and rain that comes in through a broken window or damaged roof. But if your ground floor is flooded by water that collected after a heavy rain or that is from a river or broken levee, you will not collect on that policy. You need to buy flood insurance.

Ditto for earthquake insurance. If you are in California, you will need separate coverage.

Another caveat: If you work out of your home and your business equipment is damaged, you may not be able to collect for that loss under your homeowner’s policy. Check with your insurance agent or carrier and see if you need to buy a rider to your policy or a separate business policy.

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