Does Your Business Need a Disaster Plan?

By Rieva Lesonsky

Do you think your small business has no need for a disaster plan? “I don’t live in earthquake country or flood territory,” you might think. Well, disasters that affect small businesses don’t always have to be natural ones. A burglary, fire or even a major power outage could spell disaster for your company if you haven’t properly planned for it. Seasonal issues such as blizzards can shut a company down. And if a key supplier or business partner in another state or country is affected by a disaster, it could have crippling effects on your supply chain and operations.

I hope I’ve convinced you that every business—no matter how small–needs a disaster plan for protection. Here’s a step-by-step plan to get started.

1. Risk assessment. Begin by assessing the risks your business faces. What natural disasters could affect your region or your key suppliers? What other issues could hamper your ability to do business?

2. Operations assessment. Next, assess your internal operations and figure out which are most crucial to keeping the company up and running. IT, accounting and telecommunications might be on your list. Contact each service provider to see what backup plans they have in place in case of an emergency.

3. Data protection. Disasters can destroy data if you haven’t protected it in the first place. Always back up your data and store backups offsite. These days, there are dozens of online backup services that house your data “in the cloud.” Find out where your backup provider houses its backup. Have someone at your company responsible for backup and, most importantly, from time to time try restoring backed-up data to be sure it works.

4. Employee safety. Protect your staff by creating an emergency evacuation plan. Post this where everyone can see it and have regular runthroughs so people know what to do if a disaster strikes during work hours. Put one person in charge of safety and have a deputy backup person in case he or she isn’t there.

5. Alternate location. If a disaster renders your office or store unusable, where else can you and your staff work in the interim? Figure out if people can work from home, or talk to business colleagues to see if you could rent short-term space in their facilities on an emergency basis. Also check into office suite options in your area; these businesses rent space and access to business services on an as-needed basis.

6. Insurance coverage. Don’t forget to make sure your insurance covers the risks you’ve found. Flood and earthquake insurance, for instance, aren’t usually part of standard policies. Your agent can make recommendations as to what you need and keep your insurance up to date.

Business.gov has several good resources for disaster planning and assistance. Check out their site and, like a Boy Scout, you’ll be prepared.

Image by Flickr user David Hunter (Creative Commons)

This entry was posted on Wednesday, December 29th, 2010 at 10:30 am and is filed under Small Business. You can follow any responses to this entry through the RSS 2.0 feed.


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