Small Businesses

Small Business is Hard Enough: Small Business Challenges After a Disaster

Disasters are something we all loathe. We humans are able to gird our bodies and say “It won’t happen to me” when it happens. The data proves that it is not about when it will happen but if it does.

According to the Small Business Administration (SBA), between 40% and 60% of small businesses fail after a major catastrophe. In recent years, the number of declared disasters by Presidents has increased more than twice. However, not all disasters affect the same number of people as declared ones. Fire is actually the most destructive business disaster.

Researchers estimate that half of businesses fail within their first five years, and that 88% of those that do fail within the first three years of a disaster.*

Small businesses face unique challenges which are different to larger companies. Small businesses, at 52 percent, are run out of the owner’s house or property. This makes it more difficult for them to recover. You don’t have enough time to complete them all at once. Their business cannot continue if it is located in their home. Small business owners can suffer property damage that affects both their family and the business.

Owning a small company may seem like the American Dream. However, it is not easy. The challenges are even more severe after a disaster. Both before and after the disaster, there seems to be a common theme in these owners’ views.

These are 7 problems that small business owners face after a disaster.

1. Illusion of security

2. It is impossible to prevent this.

3. Individual is in complete 360-degree chaos

4. Limits you have set for yourself

5. Imprudent use of financial assets

6. They don’t understand what is happening with their customers

7. Assume everything will go back to normal

Many entrepreneurs consider starting a business a major achievement. However, maintaining it is more difficult. No matter how big or small the business, there are common challenges. Planning is the most difficult challenge for small business owners.

Although small business owners put a lot of effort into making their ventures succeed, many fail in the ability to adequately plan and prepare for disasters. Your business can be protected by knowing the risks involved in natural and man-made hazards and by having a plan to respond should one occur. You can ensure your business’ survival by keeping these plans current.

If disaster strikes, having a plan is key to being able put it into action immediately. This can make the difference between your business remaining open for customers and the community and shutting down temporarily.

It’s not possible to know of another plan. I don’t have the time.

Preparedness is not the same thing as resilience. Preparation is something you do, resilience is something you develop. You, the owner, can become more resilient. Intention action. Do one thing today. Do one thing today. Do you back up all your data? If you don’t, then do it. Do you have a list of emergency contacts for your employees, suppliers, and clients? You should. Are you able to review your insurance policy each year with an agent? If not, get it done. Each step brings you closer to your goal.

It’s possible to finally achieve your dreams. Do not let your dream get ruined by a hacker disruption, power outage, fire, earthquake, or any other natural disaster. Unpreparedness can put your business and employees at risk.

molw.net

We are a team of professionals with each having two decades of experience in start-ups, sales, marketing, finance, HR, large scale project and profit centre management and running mature cross functional operations. At Molw.net we are big believers that knowledge transfer is critical to our industry’s evolution. We love to share our experiences and learnings through our online resources.

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