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Inside Cogent        Blog        How to Prepare Your Small Business for a Hurricane
How to Prepare Your Small Business for a Hurricane
July 15, 2024

How to Prepare Your Small Business for a Hurricane

The threat of hurricanes and severe weather events to the stability of businesses cannot be understated. In fact, according to the Federal Emergency Management Agency (FEMA), 25% of businesses do not reopen after natural disasters. From financial losses from business closures, damage to facilities and equipment, to displaced employees and even disaster scams, business owners face numerous obstacles to getting back on their feet after a disaster

With 14 major storms in the Atlantic last year (including 8 hurricanes), the best way to mitigate the impact of hurricanes on your business is to acknowledge the likelihood that severe weather will affect your business at some point and to take steps to prepare for it. In this post, we’ll discuss the most important things you can do to get your business ready. By implementing a comprehensive plan and taking appropriate precautions, you can minimize potential risks and protect your employees, customers, and property. 

DEVELOP A COMPREHENSIVE EMERGENCY PLAN. 

All businesses should have contingency plans in place to help navigate possible disruptions. As hurricanes threaten Florida and other southern states with increasing frequency and force, having a plan for both keeping the business running (or temporarily pausing business) and keeping employees and property protected are crucial to the health of your business. 

Emergency plans should be sure to include the following elements. 

AN EMERGENCY READINESS PLAN FOR EMPLOYEES

Whether your employees work onsite, at satellite locations, or from home, having a safety plan for employees in place for hurricanes is essential—especially for Florida-based businesses. Take the time to develop a plan specific to your business for both pausing operations and getting employees home (or to safety) before any lives are at risk.

EVACUATION PROCEDURES

For onsite employees, it’s crucial to have a well-considered evacuation plan—as well as plans for how to “shelter in place.” Having an evacuation plan for emergencies including fires and other hazardous events is a standard safety protocol. However, for hurricanes it’s important to develop a plan for sending workers home in the face of a coming storm—and when it’s better to stay put. 

Generally, workers should be sent home or asked to remain at home when local authorities issue evacuation orders or when conditions are forecasted to deteriorate within the next 1-2 days. Whenever there is a storm in your general vicinity, always have a member of your team follow it carefully to allow for ample time to send workers home before danger arrives. 

However, it’s also important to have a plan for sheltering in place when storms hit suddenly or change their path. To create a plan for sheltering in place, select the safest interior room—with minimal windows—as a congregation point. This room should have access to your emergency supplies (more on this later). You’ll also need to establish a communication strategy to keep everyone informed during the event, and ensure all employees are trained on the procedures through regular drills and information sessions.

Establish a schedule of regular training and drills to cover all possible scenarios—at least once a year prior to hurricane season. This will allow you to familiarize your employees with your plans, and also spot flaws that can be improved to improve safety and efficiency. You can utilize OSHA’s online tool, Evacuation Plans and Procedures, to help you design a one for your business. Be sure to include easy-to-follow steps to take if emergency strikes while employees are on the job. 

COMMUNICATION CHANNELS

Disruptions can happen for a variety of reasons—from natural disasters or health crises to simple mechanical issues that throw off your schedule. Having clear communication channels to stay connected with your employees, customers, and suppliers is important for business continuity, as well as employee safety. 

To be sure you have reliable means to communicate with all necessary parties, you’ll need to create a contact list for your employees. Include their emergency contact’s information, their home address, and email address, as well as phone numbers. You may want to ask employees to include contact information for where they may stay in the case of an evacuation (such as with a specific family member or friend).  

Update your contact list regularly before each hurricane season and complete a test notification to ensure that your list is accurate. Keep hard copies available in secure places on site and at the homes of your emergency response team leaders.  

EMERGENCY NOTIFICATION SYSTEM

There are many emergency messaging apps and systems available for disaster response. If you have a large employee or customer base, you may want to consider investing in one of these systems to facilitate communication and minimize the work you’ll need to do to stay contacted. They can help you:  

  • Message different contact categories independently (on site employees, remote employees, response team leaders, customers, vendors, etc.). 
  • Create templates to quickly send messages based on your emergency plan with instructions for pausing operations or working from home. 
  • Send automatic alerts based on current weather conditions.  
  • Send communications using multiple avenues: text, email, or phone call. 
  • Additionally, consider that during a national disaster, power and cell phone service may be unavailable. Be sure to establish alternative modes of communication, such as satellite phones or two-way radios, with select parties, in case traditional communication channels fail.  

EMERGENCY SUPPLY KIT

Making sure that any and all employees onsite are safe is your most important responsibility as a business owner. Beyond keeping your buildings in good condition and protected from wind and water, you should also have necessary supplies on hand to keep your employees healthy, fed, and warm. Your employee emergency supply kit should include: 

  • First aid supplies: including bandages, antiseptic, pain relief and other necessary medication, and clean towels 
  • Emergency lighting: flashlights, lanterns or overhead lighting, and ample batteries 
  • Communication devices: portable radios (consider hand-cranked radios) and two-way radios 
  • Water: one gallon per person for several days 
  • Non-perishable food items: canned food, dry food, utensils and plates, and a manual can opener 
  • Sanitation supplies: paper towels, antibacterial wipes and hand sanitizer, toilet paper, and trash bags 
  • Items can be stored in sealed and labeled five-gallon buckets. This can keep your supplies dry, and the buckets can be useful for a variety of purposes during an emergency. 

Store these items in a safe but accessible location and include details in your comprehensive emergency plan. As part of your preparations for hurricane season, replace all food and water supplies and batteries, and check the viability of other items. 

REMINDERS AND ROUTINE TRAINING

It’s vital to ensure that your employees receive a reminder of your emergency plan throughout the year, so that they are aware of the steps to be taken in the event of a hurricane or some other emergency. Set up ongoing personal trainings and send out reminder emails prior to hurricane season so that these procedures are top of mind. Then, schedule routine drills that enact your entire plan, from employee protection to securing equipment, practicing different potential scenarios. 

Remember, hurricanes can create real and long-lasting psychological harm to individuals who experience their full force. Plans should be designed to appease anxiety, not create it. Be sure to warn all employees of any upcoming drills, but require that they take them seriously—as if preparing for a real event. Have at least one drill prior to the start of each hurricane season.  

PROPERTY PROTECTION MEASURES

Second to employee safety, you want to be sure that you have plans in place to immediately start procedures for securing your buildings, equipment, and vehicles, in the event of a hurricane, flood, or other natural disaster. Be sure that all employees are trained on how to secure their own workspaces or equipment, and consider designating specific employees who reside nearest to your facilities to check in on property—once conditions are safe, of course. 

Additionally, all Florida businesses should create or maintain a supply center for managing your facilities during natural disasters. Supplies should include: 

  • Sandbags 
  • Mops and rags 
  • Cleaning supplies and trash bags 
  • Shovels, axes, and smaller hand tools 
  • Plywood, lumber, and nails 
  • Hoses and portable pumps 
  • Ropes, fasteners, bungee cords, and duct tape 
  • Tarps or plastic sheeting 
  • Building schematics that include electric and plumbing

BUSINESS CONTINUITY PLAN

Severe weather or other large-scale emergencies will no doubt disrupt your business operations. While smaller events may be easy to handle (for instance, closing shop early one day), bigger events can create real threats to the health and longevity of your company. That’s why it’s so important to include continuity considerations in your emergency plan to minimize disruptions and bounce back as soon as possible.  

Your plan should consider: 

  • If your business can meet payroll without income (and for how long) 
  • Immediate and ongoing communication with employees, customers, vendors, and suppliers (more on this later) 
  • Continued operation if key parts of your infrastructure (buildings or equipment) are damaged 
  • Sufficient supplies should suppliers be unable to fulfill orders or reach your business 
  • How long of a closure could your business absorb (without income) before threatening its financial stability 

Ready.gov offers a comprehensive guide, Ready Business Hurricane Toolkit, to help develop a plan to keep your business viable, even in the event of a major disaster. 

A DESIGNATED DISASTER MANAGEMENT TEAM

Select a responsible team to work together to develop the plan, then assign vital roles to individual employees in order to ensure that all important elements of your plan are covered during emergencies. Roles could include leading communication, securing and maintaining the emergency kit, reviewing insurance policies, and overseeing fortifications against flooding. 

  • Select a responsible team to work together to develop your comprehensive plan, communicating with each department as they do so. This same team can be the lead on communication during a disaster, so that all employees are aware of their roles and responsibilities.  
  • Then, create a schedule for your team to regularly review and update your plan to incorporate any changes in your business operations or infrastructure. Ask for feedback from employees on what they think works, what doesn’t, and what elements may need to be updated or improved. 
  • Lastly, develop drills that involve all members of your disaster management team. Ask for employment feedback after each drill

Not everyone will have a designated role in your disaster preparedness plan, but as you develop and test it, it’s important to include your whole team to not only ensure that everyone is on the same page, but to also include multiple perspectives and areas of expertise.  

MAKE LONG-TERM PREPARATIONS TO PROTECT YOUR PROPERTY, EQUIPMENT, ASSETS, AND EMPLOYEES.

In addition to having a comprehensive plan in place for if (or when) your region faces catastrophic weather, there are additional steps you’ll need to take to ensure that your business remains resilient. From fortifying your infrastructure and securing valuable assets, making long-term preparations well ahead of storm season, can safeguard your operations against severe weather disruptions, reducing losses and keeping your business strong.

PREPARE YOUR FACILITIES

In addition to creating a broad emergency plan, it’s important to prepare your facilities to minimize damage and protect your employees and assets onsite. Take the time to in advance of each hurricane season to be sure your property is ready for bad weather. 

Here are a few key things to do: 

  • Inspect your roof: Check your mounts and supports. Look for loose shingles or panels. Make repairs as needed. 
  • Inspect doors and windows: Look for loose panes and latches, weak hinges, and damaged trim. Replace old weather sealing. Consider replacing old windows with hurricane resistant glass windows.  
  • Install or test hurricane shutters: Not only can they keep your buildings (and the people inside) safe, they can also reduce your insurance premiums. Install them if you don’t have them—if you do, test them in advance of hurricane season. 
  • Create or review your plan to protect buildings and assets from flood damage: Whether it’s creating levees or flood walls or having plans for sandbag placement, this is essential if you’re at risk for flooding. Have a plan for where and how to store vehicles and mobile equipment. Also, as a habit, be sure to store important documents and technical equipment in flood-safe spaces.  
  • Install or test generators: To keep the lights on and security systems online, to keep sump pumps and fire detection systems going, to provide heating or cooling for employees if they become trapped onsite, or to start up operations again in the event of prolonged power outages. Be sure to also have safely stored and adequate fuel supplies on hand. 

SAFEGUARD VITAL BUSINESS DATA

Beyond hurricane preparedness, securing your business’s digital data has crucial cybersecurity benefits, protecting your private employees and customer’s personal information, financial accounts, proprietary knowledge, and operational systems. 

How can you protect your business data from both cybersecurity and physical threats? 

  • Back up data. Use cloud-based storage solutions to complete scheduled data backups, testing your backups regularly. 
  • Store extra physical copies of essential documents, including insurance policies, legal documents, and contracts, at a secure, off-site location, like a business bank deposit box. 
  • Protect devices. Be sure that all devices, including computers, phones, and tablets, are protected with strong passwords, in the event of looting. Consider enabling tracking features. 
  • Create an emergency data management team. Make sure several key people know how to manage backups, restore files, and other access data in the event of an emergency. 

REVIEW INSURANCE COVERAGE

Well in advance of hurricane season, be sure to review your insurance policies. Many insurance policies take 30 days to take effect—purchasing one when a storm is impending may be too late. Be sure to effectively document and report your assets (pictures are useful!) so that should your business experience damages, you’ll be reimbursed for all your losses (after the deductible). Keep copies of insurance policies in a secure location outside of your business premises. 

Another thing to note is that insurance companies in Florida may charge additional deductibles for hurricanes, and damage caused by flooding is often not part of standard insurance policies. Carefully read all of the terms of your policy, speaking to your agent about coverage questions you may have or purchasing additional insurance. 

Lastly, know that it may be a while before you receive a payout from your insurance company. That’s why it’s important to maintain an emergency expense fund or a business line of credit to cover necessary repair and cleanup costs in the interim. Reach out to your commercial bank or lender to learn more about the options available to you. 

UTILIZE DIGITAL BANKING SERVICES

Road closures, power outages, internet outages, and damage to structures can make it difficult to keep up with banking needs. To support financial management continuity, businesses should prepare for the eventuality that they won’t be able to visit a branch in-person in the days during and following a large storm.

One way to prepare for these disruptions is to set up and utilize online and mobile banking. Digital banking can help you manage finances, make payments, transfer and access funds remotely, and even process payroll. This flexibility can help your business maintain financial stability, giving you a jumpstart on recovery efforts. 

If you’re expected bad weather, always be sure your payroll/ACH files are submitted ahead of the storm and ensure that the appropriate team members have full functionality of their mobile banking, wherever they are sheltering. To explore Cogent’s offerings, visit our Digital Banking Services site.

BEWARE OF SCAMS TARGETING BUSINESSES

Natural disasters are often exploited by scammers, ranging from fraudulent charities soliciting money to insurance scams and schemes where scammers pose as government entities. These scams can affect individuals and businesses alike, which is why it’s so important for employees within your organization—especially those with financial responsibilities—to be aware of natural disaster scams.

Scams often include: 

  • Fraudulent Charities: Scammers pose as charity organizations to solicit donations.
  • Insurance Scams: Fraudulent claims or offers for fake insurance policies or 
  • Impersonation of Government Agencies or Assistance Programs: Scammers posing as officials to gather business information. This may include bogus relief funds or aid programs asking for fees or information.
  • Construction Fraud: Unlicensed or fake contractors offering repair services. These contractors may ask for money upfront, suggesting you will be reimbursed by your insurance policy.
  • Vendor and Supply Scams: Offers for essential supplies at inflated prices or with no intention of delivery.
  • Loan Fraud: Fake loan offers for disaster relief requiring upfront fees or personal information.
  • Data Breach Scams: Phishing emails or texts that are designed to steal or manipulate business data under the guise of emergency management.
  • Utility Scams: Fake calls claiming immediate payment is needed to avoid service disconnection. 

In general, avoid giving out any information, personal or business-related, to anyone who contacts you unexpectedly. Government agencies do not call or text to retrieve business information; if you receive such requests, it’s likely a scam. Additionally, if you or an employee is approached in person, always request to see the individual’s official credentials to verify their identity. 

To learn more about disaster scams that target individuals, check our our recent post, Beware Disaster Scams in Florida.

STAY READY FOR HURRICANE SEASON WITH COGENT BANK 

The costs of preparing for a natural disaster can feel daunting—but the cost of being inadequately prepared can be far worse. At Cogent Bank, we know the common extreme weather risks businesses in our region face, as well as the many hurdles to recovery. We want our business clients to achieve long-term success and stability despite these challenges, and that’s why we take disaster preparedness so seriously. 

Whether you’re looking for small business term financing to implement your plan and prepare your facilities and buildings for disaster, business savings & money market accounts to help you start an emergency fund, or business lines of credit to ensure a successful recovery in the event of a disaster, we have the financial tools to help you weather any storm. Contact us today to see what we can do for your business.