[caption id="attachment_18907" align="alignright" width="300"] Many businesses in Beuamont, TX were badly hit by Hurricane Rita[/caption] When Hurricane Rita hit Beaumont Texas on Sept. 18, 2005, Bill Munro, owner of a dry cleaning, uniform rental, and safety apparel business, had an emergency plan, according to ready.gov. It wasn’t enough. It didn’t account for power loss or supply shortages, and it took him a week to reopen. He’s since revised it. He was lucky. He reopened. Up to 40 percent of businesses do not reopen after a disaster, according to the Insurance Information Institute. Another 25 percent fail within one year, according to the Federal Emergency Management Agency. A business disaster plan could prevent failure. Numerous organizations have ideas, checklists, software and apps to help small businesses prepare. The steps below come from a pamphlet by the Insurance Institute for Business and Home Safety (IIBS). Know your risks First, know what types of disasters your business is most likely to encounter. The Federal Alliance for Safe Homes has a site detailing the most common natural disasters in each state. Only about 20 percent of business disasters are natural, according to the Agents Council for Technology (ACT), an organization for insurance agents. Others include fire, IT failure, espionage, terrorism and theft. You’ll need to determine which disasters will cause your company the most damage. Prioritize those in planning. Know your operations Once he reopened after Hurricane Rita, Munro realized that while no one needed dry cleaning, many contractors needed clean clothes. So he started a wash, dry and fold service. Later, he bought a generator and supplies for vital employees for three days. Determine which parts of your business are most important and how long you can go without being able to perform them. Install fire and security alarms and keep the work space in good shape, says the National Association of Insurance Commissioners (NAIC). Know your employees Munro created a communication plan that required employees to contact their supervisors within two days of an emergency and give their current address and phone number. He also designated 15 employees who would be necessary to restart the business. You need employee contact information to make sure your employees are safe, let them know what’s going on and tell them how and when they can return to work. ACT suggests using text messaging, which is often more reliable in a disaster. Also help employees plan for emergencies on site, like earthquakes, fires, shelter in place events and evacuations, suggests the NAIC. Know your key customers, contacts, suppliers and vendors When Hurricane Katrina was headed for New Orleans in 2005, Sandy Whann, president of the local Leidenheimer Baking Company, set up a satellite office in Baton Rouge. While evacuating, he contacted his customers and told them his company’s plans, according to ready.gov. He kept current customer information in a business evacuation kit along with all the information he needed to run the business. When he arrived in Baton Rouge, he arranged for his calls and mail to be forwarded. Know your IT Web sites and email are important ways to stay in contact. ACT recommended you keep your web site host offsite and have daily backups stored offsite in a cloud service or secure drive. Whann kept financial and payroll records, utility contact information, updated phone lists, backup files and software and computer hard drives in a fireproof, waterproof case he could grab immediately. If you do that, make sure the case is in a secure place. Know your finances An important part of knowing your company’s finances is to know its insurance coverage and make sure you have enough. Another is to know what you have. Make an inventory of business equipment, supplies and merchandise, suggests the Insurance Information Institute. Know when to update and test your plan Ninety percent of companies with fewer than 100 employees spend less than one day a month on their community plans, according to a 2009 disaster recovery survey from Agility Recovery, a disaster preparedness company. Twenty-two percent spent no time doing so. Practice your plan once you’ve made it. “While owners of small businesses probably feel as though they don’t have the time to prepare for an emergency or disaster,” said Gail Moraton, business resiliency manager at IIBS, in a release, “it can mean the difference between permanently going out of business and reopening quickly.” Know where to go for help Work with local emergency management officials and utilities before a disaster. Munro, the dry cleaning company owner, gave emergency officials names of his key employees so they will be allowed to enter a closed disaster area. He also contacted his local utility to arrange for power to be turned back on within 48 hours of a disaster. "If businesses are up and running, individuals can receive a paycheck and the community can stabilize," Munro said. Do you have a business disaster plan for your company? Share with us some of the things you're doing!