How To Disaster-Proof Your Business

Small businesses face numerous challenges in today’s marketplace. In fact, a recent Gallup study showed that for the first time since the late 1970s, there are more businesses closing than there are new ones opening to replace them. This is clearly a disturbing trend, and one our country must reverse if we want to ensure a healthy economy for the long term.

There are a number of reasons businesses fail. Many have inferior products/services and/or are in overly competitive markets. Others are shut down by unforeseen events in which they did not have adequate recovery plans. Catastrophes can come in several shapes and sizes, and a high percentage of businesses do not re-open after they are struck by a disaster.

The key to coming back after a disaster is to be properly prepared for it. Here are some areas to focus on to ensure your business is ready to face the unknown in 2016 and beyond:

Create a Business Succession Plan: What would happen to your business if the owner(s) and/or certain key employees were suddenly removed? Chances are it would severely disrupt operations and threaten the survival of the entity. The New Year is a good time to set up contingency plans for the unexpected loss of individuals that are vital to the company, and decide who will step in to which positions to keep the company going. You may also want to look into business life insurance that would provide critical funds for the entity to survive in the event of a worst-case scenario.

Secure and Back up Your Critical Data: These days, cyber-crime is just as much (or more) of a threat to businesses as a burglar breaking in and stealing your merchandise. Make sure you have a full inventory of all your equipment, merchandise, vehicles, etc. Also, make sure your computer networks have top-notch security and that your critical data is securely backed up in case of emergency. For businesses of all shapes and sizes, network security is no longer ‘optional’, online threats are very real and cyber criminals are not only targeting the big retailers and financial institutions, they are targeting everybody.

Review your Insurance Coverage: The New Year is always a good time to sit down with your insurance agent and review the various coverages you have to identify any gaps that could expose your business in the coming year. Depending on the industry you are in, there are various policies you should have to ensure you are fully covered. With business policies, coverages and rates tend to vary widely depending on the carrier. For this reason, it is best to speak with an independent agent who has access to several of the top insurance companies in your state. An independent insurance broker can do the shopping for you and find the policies and coverages that best fit your needs and budget.