After Sandy: 4 Steps to Disaster Recovery

There's nothing like a once-in-a-century superstorm to remind you that your small business needs to be prepared for anything.
Getting Small Businesses Unstuck, Shafran Moltz Group
November 01, 2012

A storm like Sandy is a perfect reminder on why every small business needs to constantly be prepared for disaster. This isn’t just ensuring that your company’s data is backed up offsite. It means knowing what to do when a disaster like Sandy knocks down utilities, your office building and your employees’ homes. 

After a call to your insurance broker, here are the next four steps you should take to recover your business from a disaster:

Assess the Damage 

Your first priority should be your employees. How and where are they? Have people been injured or lost their homes and personal property? What is their capacity, ability and desire to come back to work? Are there other people remotely that can replace absent employees? What’s important: Stabilize your workforce first. Attend to the employees that need help. Not only is it the right thing to do, it will build unending loyalty.

Next, check your infrastructure. Is your office, warehouse or manufacturing plant still standing? Are there reliable utilities in your area to actually run your business? How much and how long will it take for it to become functional? What is the state of your computer infrastructure and data? Where and how can it be restored? What’s important: Do you have customer, product and vendor data? If it is not in tact, what needs to be done to recover it quickly?

Then it's time to think about your customers. How have your clients been affected? What’s important: Do your customers still have the same pain for your product and can they still afford to buy it or has the market shifted as a result of the disaster? Don’t assume things will go back to “normal” anytime soon.

Don't forget to consider your suppliers. How much supply is left onsite or was it destroyed? Can your suppliers still deliver as promised and at the price negotiated? Can those supplier goods reach your physical location? What’s important: Will you stick with the same suppliers or source from different vendors? Will the product mix now shift as a result of customer needs post disaster?

Do a Serious Financial Evaluation

At this moment, how much cash is left in the bank that your company can use to repair the damage and rebuild? Can you estimate the cost of the loss and do you have enough money for a restart? What will your business insurance cover and how soon will they pay the claim? What’s important: Planning is essential here. The knee-jerk reaction is to get started as soon as possible with little financial planning.This is the absolute wrong thing to do. Put together pro-forma financial statements like it was a new start up. Do not depend on your insurance company paying your claim in a timely fashion provide the funds needed now.

Restart in Sequence

Don’t jump ahead or skip any steps. Ensure that the customer, product and vendor data are all recovered and it can be run on a system that can still operate your business. Check to see who is available to work and do they have the skills that are needed. Call customers by phone to see how they have been affected and show them that you care about them. Make sure that vendors can deliver what you need when the business needs it.

Look for Disaster Assistance 

Fortunately, when it comes to major disasters like Sandy, the federal government and states set up relief funds. Check out what is available from FEMA or your state. But again, don't depend solely on government assistance to get your business restarted.

How was your business affected by Sandy? What steps are you taking to recover?



Getting Small Businesses Unstuck, Shafran Moltz Group