You likely take steps to protect your personal belongings from natural disasters at home. But, do you do the same with your business? The last thing you want is to be unprepared during a disaster. Instead of being caught up in a whirlwind when the unexpected occurs, create an emergency preparedness plan for peace of mind.
7 Things to address in your emergency preparedness plan
You must prepare in advance and think about disaster recovery solutions. Consider including these seven things in your emergency preparedness plan.
1. Back up records
A large part of your emergency preparedness plan for business includes backing up important company records. Protect documents like accounting records, bank or financial statements, tax returns, and employee information. You can back up your records electronically or file additional paper copies for safekeeping.
Consider scanning or downloading your business records to your smartphone or computer. Or, you can save them on an external drive or compact disc. If you opt to back up records electronically, be sure the method is reliable and protects sensitive data.
Keep copies of business records in a safe place (e.g., filing cabinet). You can also invest in a filing system that is fire and water resistant to avoid damage to records.
2. Document valuables
If disaster does strike your company, you need to record the items you lost. The IRS has a document to record your business’s losses.
Review the IRS’s document beforehand to see what kind of information it includes. If an emergency occurs, use the workbook to calculate what your business lost.
3. Get insurance
One of the best ways to prepare for emergencies is getting insurance. Insurance compensates you for lost income if you need to temporarily close your business. And, insurance can help cover the costs of repairs if your business gets damaged due to a disaster.
Many insurance agencies offer liability and property plans specifically for business owners. Plans may even offer coverage for debris removal, loss of income, and cleanup.
Review your policy with your insurance agent to make sure you understand your deductibles and the limits of your insurance coverage. Include your insurance agency’s contact information in your emergency preparedness plan. Knowing who to contact after a disaster occurs helps expedite the process.
4. Alert employees
Give employees access to your emergency preparedness plan in advance so they know their roles in the process. Each employee should know what to do in case of a disaster.
Consider testing your plan by hosting meetings and doing regular drills with your employees.
Drills can help you work out kinks in your plan and show employees disaster procedures to follow.
During and after a disaster, inform and update employees about the situation. Establish a system to alert employees about the disaster and your plan of action. You can alert employees either by phone or email.
5. Invest in supplies
Make sure your business and employees are prepared and protected if an emergency occurs. To ensure you are ready if disaster strikes during work, invest in supplies.
Stock up on supplies such as flashlights, first aid kits, batteries, water, nonperishable food, and tools. Make supplies easily accessible in the workplace. Consider also investing in other devices, such as a back-up generator, in case your business loses electricity during a storm.
6. Reach out to vendors
Just like employees, you should also reach out to business vendors before disaster hits.
Talk with your vendors about the steps to take if a disaster happens. Discuss backup plans with vendors in case you can’t use or reach a certain vendor. Also, consider creating relationships with other vendors in case you are unable to use your primary vendors.
Keep a list of vendors and their contact information in your disaster preparedness plan for easy access.
7. Know who to contact
As mentioned, you should list all contacts in your emergency preparedness plan.
List all contact information for your vendors, employees, and insurance agency. You might also add information for emergency personnel, such as phone numbers for a nearby hospital or fire station.
Update the list regularly in case information changes. Consider also backing up contact information electronically.
Recovering tax documents after a disaster
If disaster strikes your business, the IRS may offer you tax relief. The IRS may grant you more time for payroll tax deposits or extend deadlines.
For a fee, the IRS can help you recover lost tax documents. File Form 4506, Request for Copy of Tax Return, to request copies of previous tax returns.
Contact the IRS for more information about tax relief and recovering tax information.
Things to remember if a disaster occurs
When disaster hits your small business, it can be difficult to focus and get back on track. Here are a few things to remember if a disaster happens:
- Don’t panic
- Follow your procedures
- Contact your employees, clients, customers, and vendors
- Reach out to your insurance agency if there’s damage to your business
Use Patriot’s easy yet powerful accounting software to track your vendors, income, and expenses. The software is stored in the cloud, so your information remains safe and accessible if a disaster happens. What are you waiting for? Get started with your self-guided demo today!
This article has been updated from its original publication date of June 8, 2011.
This is not intended as legal advice; for more information, please click here.