September is right around the corner, and with it comes National Preparedness Month. Now is a great time for small business owners to get a head start on a disaster recovery plan.
Disaster recovery plans are not difficult to develop, but they do take a bit of time and careful consideration. There are three basic steps to develop your plan:
Risk Identification and Assessment
Types of risks you should consider range from as simple as a power outage to as devastating as a wildfire or flood that may completely destroy your business’ physical location. Consider the possibility of computer data breaches or disruptions in your supply chain too.
Impact Analysis
Once you have identified potential risks, it is time to consider the impact on your business if one or more of those disasters occur. Will the business be able to continue serving customers? Will the business be able to process transactions? What will happen to your employees?
Risk Mitigation
Now is the time to really start planning. How can your business recover if one or more disasters occur? Or better yet, how can your business avoid the potential disaster in the first place? Review your insurance policies to make sure your business is fully covered. Have data recovery plans in place. Consider potential alternate locations for your business to move to if necessary. And focus on a communication plan in order to let your customers and employees know how to find you in case of emergencies.
Also, carefully consider how you will be able to meet your financial obligations during an emergency. Do you have an emergency fund of cash on hand? Or do you have a line of credit with your bank? Do you know the availability of potential disaster relief funds?
Once you have developed your plan, make sure to implement and train your employees accordingly. Make sure your plan is written, known, and accessible to you and your employees. A plan does no good unless it is followed.
There are many outstanding online resources that can help you develop your disaster recovery plan. The U.S. Chamber of Commerce Foundation has a page dedicated to small business readiness. You can develop a plan and register for potential recovery funding after a qualified disaster.
Other online resources include the U.S. Small Business Administration and FEMA’s Ready website.
Finally, reach out to your financial or other professional service providers. They can help small business owners develop their own disaster recovery plans. If you don’t have a financial professional, reach out to the professionals at Cordell, Neher & Company, PLLC; we can help.