Businesses Vulnerable Too When Disaster Hits

October 14, 2004

When disaster strikes, businesses can be impacted too. Buildings can be damaged. Inventory ruined. Records lost. Yet, orders still must be filled and payrolls must be met.

Businesses that were affected by the flooding and severe storms that occurred from Aug. 27 to Sept. 27 might qualify for assistance from the U.S. Small Business Administration. Businesses of all sizes and non-profit organizations may apply for losses not fully covered by insurance.

Loans to businesses are available up to $1.5 million to repair real estate, machinery, equipment and inventory. Economic Injury Disaster Loans (EIDLs) also are available to small businesses unable to pay bills or meet operating expenses. Interest rates can be as low as 2.900 percent, and loan terms can be up to 30 years. Actual loan amounts and terms are set by the SBA and are based on each applicant’s financial condition.

Businesses can begin the disaster application process by calling the toll-free registration number 1-800-621-FEMA (3362) or 1-800-462-7585 (TTY) for the hearing and speech impaired. The toll-free telephone numbers are available 24-hours a day, seven days a week until further notice. Individuals with Internet access now have the option to register on the agency’s Web site at, where valuable recovery information is also available.

But, what can a business do to help reduce losses should a disaster occur in the future? The Federal Emergency Management Agency and the Ohio Emergency Management Agency offer the following tips to business owners:

* Do a risk-analysis for the most probable type of disaster one might have – i.e. wind, flood, snow, fire.

* Develop both emergency and recovery plans for one’s business. Plan in advance what to do if a disaster occurs, including what employee assignments will be. Practice those assignments. Also, create a plan to recover the business afterwards.

* Purchase flood insurance. If one’s community participates in the National Flood Insurance Program (NFIP), any business owner can buy flood insurance for the structure and contents. Home businesses are not covered under a homeowner’s flood insurance policy but can be insured separately. There is a 30-day waiting period before the policy becomes effective.

* If computers are essential to one’s business, protect the data. Back up any computer system at least once a week. Make at least three copies of essential information and store the back-up disks in a safe place, preferably off site.

* Maintain an up-to-date inventory of one’s assets.

* Make a list of critical suppliers and/or repair services needed to begin the disaster recovery. Be sure to include alternate vendors for supplies/equipment essential to the business. Keep this and other irreplaceable information such as payroll and tax records off site in a secure location.

* Consider storing minimal inventory on site. One recommendation is to maintain just three to five days’ worth of inventory on hand so that when a disaster occurs, the loss isn’t as great.

* Elevate or relocate major appliances, critical equipment or machinery well in advance of a flood. Items such as furnaces, water heaters, copiers, computer networks, etc. can be re-set on a raised platform base. Electrical panel boxes and outlets also can be relocated higher. Any alternate location should be above the base flood elevation at that site. Local building officials can identify for individuals the base flood elevation.

* In any situation requiring structural changes, be sure to first check with local authorities to determine what code requirements must be met.

For additional information log on to www.Ready.Gov and click on “Ready Business.”

The Ohio EMA coordinates State assistance and resources during an emergency and prepares the state for all hazards through planning, training, exercises and funding activities at the state and local level.

This includes providing assistance to individuals and administering state and federal assistance to individuals and governmental entities recovering from disaster-related damage and costs. Ohio EMA coordinates homeland security funding, weapons of mass destruction training, anti-terrorism planning and training, and assists local and state agencies determine homeland strategies and priorities.

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