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Disaster Planning Should Start Early

2 min read

After a disaster strikes is not the time for the business owner to develop a plan to reopen the company.

The planning should be in place before a catastrophe occurs, said Linda Nelson, Arkansas district director of the U.S. Small Business Administration.

Having a plan includes creating a list of who the business’ major vendors and customers are and how to reach them, Nelson said.

The Federal Emergency Management Agency’s website, Ready.gov, also can help a business owner with pre-disaster planning tips that include keeping copies of insurance polices and tax records at another location that wouldn’t be affected by a disaster.

After the devastation, “for many, the hardest thing is what do I do first?” Nelson said.

But having a plan in place will help, she said. The backup plan should include where to do business if the company’s building is destroyed. For example, it might share a building with another company in another city or use space from a vendor, Nelson said.

Cash also could become a problem after a disaster. The SBA and FEMA will make low-interest loans to companies for their uninsured losses to help them get back on their feet. The deadline to apply for a loan is 60 days after the event is declared a disaster. Nelson encouages companies to apply for the money even if they don’t need it, because “you never know,” she said. “And if they don’t need it, it can be canceled or decreased.”

Low-interest loans also are available through the SBA for businesses that have been financially stung from fallout from the disaster. If it takes three to four months to get a business back up and running, sales might take a hit, Nelson said. The loan for economically injured businesses could help with the company’s cash flow, she said.

“Even businesses that weren’t physically hurt can still be impacted, especially in small communities, so they may qualify for this as well,” Nelson said.

As of June 11, the SBA has approved more than $5.1 million in low-interest disaster loans to Arkansas residents and businesses, according to FEMA’s website.

She also encourages businesses to work with the counselors that the SBA provides for free through the Arkansas Small Business & Technology Development Center in Little Rock. The business owners can use the counselors as a sounding board for their next business move, which might include starting over in another location or expanding, she said.

Business owners also need patience after a tragedy, because it might take some time before the community is thriving again, Nelson said. But “once you start hearing sounds of rebuilding rather than demolishing what was left, … it gives everybody a better sense of hope that ‘OK, we can recover,’” she said.

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