Disaster Recovery for Small Businesses


According to the Federal Emergency Management Agency (FEMA), 40 to 60 percent of small businesses never reopen their doors following a disaster. That’s a disheartening statistic for any owner trying to pick up the pieces following a devastating fire, storm, platform hack, security breach, riot or other unexpected catastrophe.

As overwhelmed as you might feel, it is important to know that your post-disaster actions and speed will directly impact how quickly you’re able to get your business up and running again. If you want to be one of the businesses that survive, you’ll need to be intentional about the process you follow to get on the road to recovery.

Take stock of the damage

Knowing the level of damage to your business assets is going to be the first step in determining what you attack first. Start with fundamental questions like are employees okay and available to return to work? Do you have a way of contacting everyone? Is it safe to return to the premises?

The next question you should ask is: Does your company need to acquire new equipment so you can be back in business quickly?

Answering these questions helps you visualize the challenges ahead and prioritize the steps involved in your recovery.

Reach out for help

Make sure you take photos of all the damage before you start cleaning up. When you pick up the phone to call your insurance company, you’ll want proof for your claim.

Hopefully you have insurance that covers both the physical damage and compensates you for lost business as a result of a fire or natural disaster. This would be in the form of coverage for your building and its property as well as business income insurance to replace any income the business loses as a result of a disaster.

Whether you have insurance or not, for businesses affected by natural disasters like hurricanes, the federal government may also have assistance available. You should also remember that the Small Business Administration has various programs to help with disaster recovery as well.



Be lean and mean

Small businesses may not always have an advantage when going up against larger competitors, but in the immediate days following a disaster, being lean may be an asset in recovering more quickly.

Being small means you do not have to conduct endless meetings to hash out approaches and strategies. Another advantage of being a small company is that you are less likely to have obstructive red tape, which gives you greater freedom to make timely, decisive decisions.

Leverage your size and responsiveness to make necessary decisions fast and get your doors back open.

Get started as soon as possible

Resist the temptation to wait for the most opportune time to start your business recovery. Once the danger has passed and you can safely assess the damage, you should.

Every day that your business is down; it loses money, time, and clients. Every day that you are not implementing a recovery plan, you are getting further from recovery and reopening. Time can be your worst enemy when trying to recover from a disaster.

Start with something, even if it is a limited service or offering. There needs to be some initial signs of recovery so clients come back, even if that means only offering one item or service.

This will help with some money coming in that will ultimately aid with your recovery, and even if it’s not a lot, at least it is not another day you are digging the finances deeper.

Start communicating 

Along with reintroducing your service offerings, you’ll need to inform clients that you’re back in business. To reassure and keep them on your side as you fully recover, you should keep your company’s leadership visible and reachable.


During a recovery, clients will have lots of questions and need answers from you and your team. Being accessible and sharing what you know, when you know it can be the linchpin in retaining clients through the recovery stage and beyond.



Don’t forget about taxes

Depending on the time of year disaster hits, prepping for taxes may not feel like a priority. However, don’t wait too long to organize your files.

Most small business owners do not think about taxes and records following a disaster, but they are so important to a business.

You will need to make sure you still have copies of previous tax records and a good backup of your income and expense information for the current year. If everything was lost, there are ways to reconstruct missing tax records by obtaining IRS transcripts. You can also contact your tax preparer to get copies and any records they may have. You can get data from third parties, such as banks, credit card companies and vendors as well.

You will need to do this immediately, because as time goes on, your memory will not be as clear, and the IRS knows this. Get the records you can, reconstruct the rest, ensure everyone and everything is safe, and then get back to business.

Plan ahead

Once you’ve made some traction in getting your business back on track, you want to take steps to ensure it could survive another disaster. The best recovery plans are the ones made before a crisis, not after.

There is no guarantee that a business won’t suffer through multiple disasters in its lifetime. Use the experience to put a disaster survival plan in place for your business and update it often as your business grows.