- Develop a continuity plan to maintain operations during unexpected challenges.
- Prioritize essential tasks and organize emergency contact information for quick access.
- You can protect your small business with insurance that fits your needs to help protect you from the unexpected.
Running a small business can be full of surprises: some positive, like gaining a new client unexpectedly, and some challenging, like Stormstechnical problems, illness or loss of a key employee. These disruptions can impact your operations, but a well-crafted continuity plan can help you weather the storm.
A continuity plan is an essential tool designed to keep your small business operations running even when a sudden emergency arises. In fact, investigation A Federal Reserve report shows that nine in ten small businesses reported experiencing a financial or operational challenge in 2023.
To help ensure that operations can continue during and after a disruption, here are the key steps to creating a business continuity plan.
1. Develop your plan
Clear communication is the key to continuing to operate during difficult times. Knowing exactly how to get in touch with your team can save you valuable time and keep you organized, no matter what’s going on around you.
Gather your team’s contact information in one place: Create a spreadsheet that includes contact details for all key employees, especially phone numbers and personal addresses.
As a backup measure, it’s also a good idea to ask for emergency contacts, such as a spouse or close family member. Store this information digitally and keep a hard copy in a safe place so it’s easy to access when you’re in the middle of a crisis. If your business relies heavily on suppliers or vendors, be sure to document their contact information as well.
For example, if you own a bakery, you might have a list of suppliers for essential ingredients like flour and butter. While you may have this information stored on your phone, your team members should also be able to access it in case you’re not available.
Put someone in charge: Designate someone on your team to lead emergency communications, as well as a backup. If your small business has multiple locations, consider selecting a coordinator and backup person for each site.
Establish backup communication channels: If you are facing a natural disasterIf a weather-related emergency or technology incident occurs, you may not be able to communicate via phone, video conferencing platforms, or email. Ask your IT team or a third-party managed services provider to come up with a plan to stay in touch with your team if the power goes out or internet or phone service is interrupted.
Some key questions to consider include whether you need a generator, whether you should invest in backup internet solutions like hotspots, and whether your leadership team needs laptops to work remotely.
It is much easier to address these tasks in advance than in the midst of a disaster or emergency.
2. Identify critical business functions
Documenting your company’s critical functions will help you prioritize tasks during an emergency. If some of your employees are unable to work or key resources become inaccessible, you may need to focus on the essentials.
Prioritize key activities: Critical business functions are activities that your internal staff must perform in order to deliver the products or services your customers rely on. Let’s say you own a children’s hair salon where cutting hair is a critical business function. In the event of an emergency that prevents you from operating at your regular location, you’ll need to find an alternative location (perhaps a salon across town that’s willing to share the space) to continue serving your customers safely and efficiently.
Create a list of important accounts: It will be difficult to perform critical business functions if you don’t have access to your financial accounts. You’ll need access to your bank account, payroll provider, and rent and utility accounts to keep your operations running. Be sure to document these and other important financial account numbers and discuss with your advisors whether you should grant access to these accounts to someone else on your team.
Take time to plan for succession: Most small business owners want their business to continue even if they can no longer run it. Planning for succession with a team of professionals, such as your attorney and business advisors, and updating your succession plan regularly, can help ensure that you have a say in the management of your business if you are no longer able to run it.
3. Create recovery strategies
Making sure your business is insured is helpful in recovering from any major disruption. State Farm® offers insurance options for small businesses, such as a Business Owners Policy (BOP)offering a combination of coverages to help protect your unique business. Your State Farm Agent It can help you protect your small business so you can focus on growing it.
Get more State Farm financial and insurance tips for your small business.
This post was created by Insider Studies with State Farm.