How to Prepare for the Most Common Small Business Disasters

There’s no shortage of disasters a small business could encounter on a daily basis. If you have a

plan to handle them though, they’ll be much less threatening. Here are the

seven most common small business disasters and how to prepare for them.

You rely on suppliers to ensure your business has every piece of inventory it needs. When a vendor runs out of an essential item, it can lead to fulfillment delays, lost revenue and —worst of all — disappointed customers.

01. Key Inventory is Out of Stock

To Be Prepared:

• Have a list of backup vendors you can go to in times of need.

• Unable to restock inventory? Offer inconvenience coupons and create a communication plan to let your customers know when the item is back in stock.

02. A Disgruntled Ex-Employee Takes to Social Media

Thanks to social media, almost anyone who wants an audience can easily find one. If an employee who was recently let go makes damaging statements about you or your business on social media, it’s important to be ready to respond in a thoughtful way.

To Be Prepared:

• Keep your employees’ use of social media in mind when creating nondisclosure agreements or social media policies. Spell out what employees — both current and former — can share about your business online.

• Have a planned response ready for ex-employees who write something harmful on social media to avoid reacting in a hotheaded manner.

03. Your Business is Robbed

According to Insurance Journal, burglary and theft are the most common property and liability claims, affecting more than 20 percent of small business owners in the past five years.

To Be Prepared:

• Implement specific training to prevent various types of theft. Greeting each customer when they enter, offering to hold items for purchase behind the counter, or asking customers if they are ready to check out can help mitigate losses.

• Use an alert system that notifies all employees when there’s a suspicious customer. A group text message is a good way to ensure all employees receive the notification in a timely fashion.

04. The Power Goes Out

Your business can lose power when you least expect it because of a local construction accident or fallen tree branches. This can result in lost revenue if you aren’t able to complete transactions or conduct business until the power is restored. In fact, a report from the Department of Energy showed that power outages cost American businesses nearly $150 billion in 2014.

To Be Prepared:

• Store battery-operated chargers for your smartphones in a safe place. These will allow you to make calls, access the Internet and return emails until power returns.

• Offer a “return to power” discount to customers who tried to purchase something while your power was out.

05. Your Computer Crashes

Having a computer crash can result in lost productivity if you require a computer to fulfill client needs. According to a small business survey conducted by Brother International, a crashed computer can be more disruptive than a sick employee.

To Be Prepared:

• Don’t ignore warning signs. A loud computer fan, slow-running programs and program update alerts are all signals designed to protect your computer from crashing. Taking 10 minutes to fix these issues now is preferred over losing your computer for a week.

• Scan or take photos of important documents with an app, such as TurboScan, and store them on a cloud-based service instead of on your hard drive. This will allow you to access these documents from any computer.

06. Your Most Reliable Employee Unexpectedly Quits

As a small business owner, your most reliable employee is a very important part of your team. If that person unexpectedly quits, it can present a tough transition. The good news is that how you structure your team and approach finding a replacement can make such a transition easier for you and your remaining team members.

To Be Prepared:

• Cross-train employees so you can easily absorb that person’s responsibilities.

• Have an arsenal of go-to independent contractors and work with them until you’re ready to hire someone full time.

07. A Natural Disaster Hits

One in four small- and medium-sized businesses hit by a major storm regretfully do not reopen.* Careful preparation for the worst potential natural disasters in your geographical area can help ensure that doesn’t happen to your business.

To Be Prepared:

• Get covered. Have insurance policies for natural disasters that are common in your area.

• Store some of your inventory in a separate location so that you’re able to fulfill online orders if your storefront isn’t accessible (or has been damaged).

*According to the Eastern Kentucky University Department of Safety, Security and Emergency Management

Advice Action InspirationStarting and running your own

business is a big achievement

(and investment). Whether

you’re hiring staff or setting

administrative policies, make

sure each decision you make

strengthens and protects your

company instead of leaving it vulnerable.

Brainstorm all possible disaster

scenarios that could affect

your business, and put a crisis

plan in place for each before

they happen.

“Make preparations in advance

– you never have trouble if you

are prepared for it.” — Theodore

Roosevelt, American president