With the formation of Tropical Storm/Hurricane Elsa in the Atlantic Ocean, the annual “will it or won’t it” speculation begins. Small-business owners must begin, if they have not already done so, to look at how a tropical storm or hurricane might affect their business and what options are available to them.

It is never too late to plan for a disaster. A wealth of tools, articles, and information is readily accessible to help in this undertaking. An excellent starting point is the Hampton Road Small Business Development Center website at Here you will find links to state and federal sites to assist planning and preparedness.

The Public Entity Risk Institute at the Center for Organizational Studies at the University of Wisconsin-Green Bay conducted research into a variety of natural disasters. They concentrated their analysis on how small-business owners responded in the aftermath.

Regardless of the disaster, there are only three potential courses of action available to small-business owners in responding to a disaster. These are: reopen the business, close the business, or sell the business.

Each option has its own challenges and consideration and they are all situationally dependent.

However, prior to arriving at this decision point, a prudent small-business owner will take the time to analyze the situation and develop several courses of action to minimize physical, financial, and psychological damages resulting from the storm. Several key questions need to be asked to ensure a thorough understanding of the situation and options are available.

The first question is: “What happened and what is happening?” When faced with the destruction of a business, it is sometimes difficult to comprehend that other businesses or segments of or the entire community may also be impacted. Situational awareness is essential, as early decisions made in the heat of crisis or in despair might not be what is really needed.

A key component in this decision process is: “What happened to or what is happening to my customers?” Customers are key to a business’s survival. Without them, there is nothing. How have they been impacted and will the competition be able to replace you as their key supplier?

The second question is “How much did I lose and where will the funds come to reopen?” This is essential as cash flow is now going to be a primary concern. How long will it take to file and settle insurance claims or arrange for disaster loans from the Small Business Administration’s Economic Injury Disaster Loan program? What costs will be covered and what will not? Can supplier credits be negotiated? The same for leases and other expenses.

The third question: “How strong was the business prior to the disaster and how well is it positioned to survive following the disaster?” If a business was having trouble prior to the disaster, the odds are that it will not be able to survive even a minimal disruption in operations. Going back to the customer question, how will a business owner be able to maintain his or her customers if there is a lack of inventory, delays in shipping and fulfillment? Competitors also factor quite heavily in this analysis. What is their status and condition? Will customers see them as an acceptable replacement provided for the goods and services they need?

The final question is one that every business owner dreads addressing: “Are you able to give what it is going to take in implementing or executing the course of action?” The ultimate “gut-check,” it has to be clearly and honestly addressed. Neither false bravado nor “Chicken Little” thinking is desired. What will be the impact on family and friends? What will be the financial and emotional impacts? These questions all have to be considered and addressed.

Your chamber of commerce and Small Business Development Center has the information, tools, and other resources all available at no cost and are completely confidential and nonjudgmental. As in any situation, a lack of information is the most dangerous thing. Take the time now to think about your response to a disaster scenario. Doing so is not a “waste of time,” but rather an investment in your business’s survival and your peace of mind.

Jim Carroll is the executive director of the Small Business Development Center of Hampton Roads, an affiliate of the Hampton Roads Chamber.