Prepare for the unthinkable
Congratulations! You’ve passed the halfway point in our list of steps required to launch a new business. Give yourself a well-deserved pat on the back, then take a deep breath — because our next topic is disaster, a condition no one especially likes, but all need to be prepared for.
Up until two years ago, disasters in Florida typically took one of two forms: they were either natural (hurricanes, floods, lightning strikes and sinkholes) or man-made (toxic chemical spills, civil unrest, gun violence and vandalism). That changed in 2020 when a deadly pandemic engulfed the world and, sadly, is not finished with us yet.
But here’s the good news. The wisest small business owners can still thrive because:
They know what they’re up against.
There’s a big difference between bracing for a Category 5 hurricane and finding the nearest COVID-19 vaccination site. Both are concerns, but one is unquestionably more urgent. And while natural disasters are rarely preventable, some of their effects may be mitigated by simple steps: installing impact resistant windows; mapping evacuation routes in advance; and backing up computer files to store off-site or on the cloud.
They can create contingency plans.
What will you do if a hurricane blows the roof off your workplace? Or if COVID rears its ugly head again? How will you communicate with customers? With suppliers? Can your employees work from home? And if so, how will they home-school their children and care for elderly family members at the same time? Questions like these need to be addressed before the answers are needed.
They will protect their people.
Wise business owners stand ready to vacate their businesses at a moment’s notice because they are prepared. Everything they need to know in the moment – directions to shelters, hospitals and other emergency services; post-emergency phone numbers; and up-to-date emergency contacts and essential medical information for all employees – has been put in writing and stowed in a safe place.
Getting back to normal
Once the storm passes or the virus is contained, you’ll push to resume normal operations and bring your employees back to work ASAP … until your insurance adjuster says it could be weeks before your claim is processed. How will you afford to make necessary repairs and pay your staff in the meantime?
Look to the Florida SBDC Network for help. Immediately following disasters, SBDCs across Florida serve as primary contacts for processing and submitting the paperwork needed to secure Florida Small Business Emergency Bridge Loans. If your business has been physically or economically impacted by a hurricane, pandemic or other disaster, a bridge loan can be your first step to recovery.
A bridge loan gives you ready access to working capital, helping you “bridge the gap” between time of impact to the point where longer-term solutions, such as sufficient profits, federal disaster assistance or insurance proceeds, become available. Bridge loans are activated by Florida’s governor following a disaster and funded by the state of Florida. And remember, just as its name implies, this is a loan, not a grant. You will eventually have to pay the money back.
The ability to keep working through a worldwide pandemic — albeit it mostly from home — is thought to have saved many a small business from closing its doors all together. At the same time, however, it seems to have fueled a rise in cybercrime. According to the most recent Verizon Business Data Breach Investigations Report (2021 DBIR), with an unprecedented number of people working remotely, phishing and ransomware attacks increased by 11% and 6% respectively in 2021. The tradeoff is that it kept commerce going.
Check out the Small Business Development Center Network’s online workshops and seminars and/or connect with an FSBDC counselor near you for one-on-one guidance in structuring a tailored cybersecurity plan.
Be Ready to Go Portable
A workplace emergency is no time to start gathering documents and supplies. Do it now.
Here’s what to include:
- Emergency contact lists of employees, suppliers, vendors, key customers and repair services
- Emergency cash
- Insurance policies and agent contacts
- Disaster recovery plans
- A list of bills that regularly need to be paid
- Backups of computer files
Place it all inside a water-and-fire-proof box that you lock and store in a secure, off-site location and breathe a little easier.
Insurance is available to protect against almost any business risk. Consult with an insurance agent to determine which of the following types of insurance you will need, then compare terms and prices to decide what’s right for you.
FOR YOUR PROPERTY
General Liability Protects a business against financial loss resulting from bodily injury, property damage, medical expenses, libel, slander, lawsuits and settlement bonds or judgments.
Product Liability Protects against financial loss resulting from a defective product that causes injury or bodily harm.
Professional Liability Protects against financial loss resulting from malpractice, errors and negligence.
Commercial Property Protects against loss and damage of company property due to fire, smoke, wind and hailstorms, civil disobedience, vandalism and other such events.
Home-Based Business Insurance A rider added to your homeowners insurance that offers some protection for business equipment and liability coverage for third-party injuries.
Business Owners Policy Combines all of the typical coverage options in a single package at a reduced price; generally available only to businesses with fewer than 100 employees.
General Liability Flood Property insurance does not cover damage from floodwaters, whether from rivers, lakes or oceans; however, business owners may insure their building and contents for up to $500,000 each through the federal government’s National Flood Insurance Program (NFIP).
Windstorm Available through Citizens Property Insurance Corp., the state-created insurance provider, or private insurers; type of construction, size, location and proximity to water determine cost and availability.
Business Interruption Pays ongoing expenses such as rent, utilities and, in some cases, payroll when a business must close due to an insured property loss — i.e., in the aftermath of a hurricane.
FOR YOUR PEOPLE
Directors and Officers Liability Protects the company and individual executives should employees, shareholders, government agencies and/or others sue directors and officers over financial losses due to alleged company mismanagement.
Key Employee Protects a business following the death of an individual considered vital to the firm’s success. Similar to a life insurance policy, except the death benefit is paid to the company rather than to the individual’s family.
Workers' Compensation Florida law requires employers with four or more full- or part-time employees to have workers’ compensation coverage for their employees. Sole proprietors and partners are not considered employees; corporate officers are, unless exempt.
FOR YOUR IDEAS
Intangible Assets Your company’s reputation, name recognition, know-how and/or creative ideas have no physical existence, but they have commercial value and should be protected by one of the following:
Patents A patent is a property right granted by the U.S. Patent and Trademark Office to an inventor to exclude others from making, using or selling the invention without permission for a specified period of time. Visit www.uspto.gov for information.
Trademarks Words, symbols, names, internet domain names, packaging and labeling that distinguish one company’s products from another may be registered as trademarks through the U.S. Patent and Trademark Office or, for more limited state protection, through the Florida Department of State, Division of Corporations.
Copyrights An author’s exclusive right to use his or her original writing, musical compositions, artistic designs and other works of expression is automatic when a work is created and lasts 70 years after death. Official registration is optional in most cases; for protection, simply add the word “copyright” or © symbol, first year of publication and name of copyright owner(s) at the top of the page.