Steps to Rebuild Your Business After a Flood

As many people who have lived through a natural disaster will tell you, surviving the storm is the easy part—the real hardship begins when an individual has to begin to rebuild. This can be even more difficult if you have to rebuild a business, as you’ll have to keep open communication with employees, insurance companies, and customers.

The very first thing you should do is contact your insurance provider. This needs to take place even before you go to clean anything—a company will need to assess everything. After a natural disaster, especially, insurance providers will be responding quickly to conduct reports on the destruction of your property. Certain water-damaged items, including your merchandise or flooring, could be used as evidence of destruction when you’re seeking assistance. Keep these items.

Remember: there is no shame in seeking assistance, especially in this time of need.  The Small Business Administration (SBA) is available to give you a limited amount of assistance. Any business may be able to apply for assistance through an Office of Financial Assistance. These are low-rate, long-term loans meant to help businesses repair after a disaster. In the case that a business faced no physical damage, these loans may still be used to face some of the economic pitfalls that are caused by such a large storm.

The maximum total amount that a business can borrow is $2 million and use it over 30 years to repair any property. All at a four percent interest rate. In cases of no insurance or too little insurance, you may be able to obtain a 20% increase—based on the total amount of damages—in order to protect the property against future and similar disasters.

Renters and homeowners are also able to borrow, from the SBA, up to $40,000 at a rate of 4 percent interest for up to 30 years to repair and/or replace personal property that was damaged and/or destroyed, as well as $200,000 for home repairs.

As with anything in life, communication is vital. In cases like these, it is critically important to inform your customers and client base to inform them as to what is happening with the business.  This can be accomplished through updating your business’s website with updates on the repairs, letting customers know if shipping and/or ordering products will be delayed, as well as when the business will be operating as before the disastrous event.  Additionally,  in the age of social media, it would be helpful to update your company’s Facebook and/or Twitter accounts with updates on the repairs.

Because honesty is the best policy, it is important to inform your customers/clients about when your business is expected to be operating at its normal capacity again, as well as operating plans for the business’ recovery period.  If this advice is followed, people will see that your business is one that knows how to properly handle its problems and that you, as well as your business, are trustworthy.

As with anything that is government-run, federal aid will be available, but not at the pace you will need it to be—natural disasters cause claims to move even slower as everyone is filing. Therefore, don’t count on fast help from FEMA. While FEMA will provide shelters for the temporarily homeless and potential money to rebuild their homes, a business owner’s private insurance or an SBA loan will be a business owner’s best chance of receiving help quickly.

It might not be a bad idea to create a contingency plan.  Every business should have a plan, if not now, then soon, in order to prepare for the possibility of a similar disaster’s arrival again.  Such questions that a continuity plan would ask might include:

  • How will the company keep filing and tracking orders?
  • What happens if vendors are not operating?
  • What happens if company employees are unable to make it to work?

Also, if your business does not already have one in place, consider putting a data recovery plan in place, in order to protect important company files.  Consider researching data recovery programs, as well as Cloud-based services, so that you and your business might be prepared for the next time disaster strikes.

Because most businesses are not insured against floods and/or earthquakes, especially if these businesses are not located near fault lines or floodplains, it might be beneficial to beef up your company’s insurance plan.  All businesses should take note that most insurance plans do not protect against wind damage from a hurricane or utility disruption from a storm.  Our advice includes:

  • Review your current insurance plans to make sure you understand the fine print.
  • Consider adding a separate policy, in order to cover losses from a severe storm, which might not be included in your current insurance plan.

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