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GreatFX Business Cards Small Business Buzz Preparing Your Business for Impending Disaster
Small Business BuzzPreparing Your Business for Impending Disaster
A doubleshot of business news espresso with extra froth
Last week, the wildfires in Southern California received top billing on the news nationwide. While many people tragically lost their homes, there is no doubt that some also lost their business in the fires.
Many of us will never have to face out of control wildfires as a risk factor for the destruction of our business, but natural disasters of every kind span the nation. Anything from wildfires, to tornadoes, ice storms (which caused some devastation in my home town last winter), to hurricanes, there are a number of possibilities that can damage to your business. And you need to make sure you’re protected.
Additionally, you may want to look into Business Interruption Insurance. According to the Insurance Information Institute, Business Interruption Insurance will cover your business income in the event that you can not do business due to a disaster, such as fire. The benefits you receive are based upon your business’ financial records and should also cover operating expenses, such as the electric bill. Be sure that your policy limits will cover you for an extended period of time, as it typically takes anywhere from a week to a couple months to get things up and running again.
Backup Everything Often
Additionally, you should update your inventory at least annually. Part of this inventory should be a list of all of your assets (equipment, supplies, etc), including the model and serial numbers, purchase date, purchase price and pictures. You should take pictures of everything, including vehicles, the interior and exterior of your building, equipment, and even the cleaning supplies in the closet. The more thorough your documentation, the more likely you are to get reimbursed for everything you may have lost.
Gather Your Stuff
Know What to Expect
Also, from a tax perspective, you need to know that, if you do not replace your inventory and rebuild your business with the insurance benefits your receive (maybe this disaster gave you the opportunity you were looking for to do something else), then the government views those benefits as a taxable income for the sale of assets. However, if you do replace them, the benefits are not taxable.
The important thing to do when running a business, big or small, is to be prepared for anything. Don’t take any chances, be sure you’re insured and back-up everything on a regular basis in more than one location. You can never over protect yourself, but you can definitely be under the mark. Do what you can to prevent ever being in that situation.Related Buzz Posts:
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By Michelle Cramer
Friday, April 5th, 2013 @ 12:00 AM CDT
Operations, Ownership |
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