Restaurant owners have a lot to think about and prepare to ensure that their day-to-day operations are running as seamless as possible. From selecting the menu and maintaining accounting records, to marketing and training the staff, the list of things that need attention seems endless. So as a restaurant owner, you may not be thinking about preparing for natural disasters, particularly hurricanes.
From 1980 to 2019, the United States total cost of damages caused by extreme weather was estimated to be $1.6 trillion. Based on the data from the NOAA National Centers for Environmental Information, eight hurricanes were recorded during the Atlantic hurricane season in 2018. These included Hurricanes Florence and Michael which were considered among the most damaging storms, with the overall cost of damage reaching almost $50 billion.
The restaurant industry is not spared when there's a hurricane. In fact, loss of or damage to properties are recorded every year due to natural disasters. As a restaurant owner, it’s challenging to bounce back from a damaging incident. You can just imagine the impact of a hurricane on a small business that loses assets, including products and company vehicles. And for some restaurant owners, they may never recover.
Thanks to advancements in technology, we can estimate when a hurricane is going to hit and which areas will be affected. But, when it comes to a business such as a restaurant where day-to-day operations are crucial, it pays to be prepared. And that means taking steps to ensure that your restaurant can minimize damage in case of a natural disaster.
Here are several things that restaurant owners should do to prepare for hurricane season:
Create a response plan. The key is to prepare before a hurricane strikes. Have a response plan, as well as a follow-up plan, and make it a priority. It's all about keeping everyone and the business safe and secure in case of a natural disaster. A response plan indicates the steps to take in case of an emergency or crisis. Make sure that everyone in the restaurant knows what to do before, during, and after a hurricane. The plan should also have detailed evacuation routes and contact information. Hold drills regularly to ensure that all employees know what to do. Also, adhere to safety standards and guidelines by having safety equipment, including smoke detectors and fire extinguishers.
Stay in the loop on what your state provides. Many states have funds in place to address the needs of those who will be affected by natural disasters. Make sure to know what your business can get in times of a hurricane. Your employees may also be eligible to receive benefits to help minimize the impact of a natural disaster on their livelihood. It is best to prepare their documents ahead of time to avoid inconvenience later on.
Carry adequate coverage. Insurance is one of your best bets when it comes to protecting your restaurant against substantial financial losses due to natural disasters. Business continuity is essential in any company, and restaurants are no exception. With insurance, you can be sure that your operations will recover when a disaster strikes. Many owners of small businesses don't make insurance a priority, seeing it as an additional expense. But the reality is, it's an investment that will keep the business going even after a hurricane or any incident that has a significant impact on the operations.
There are different types of insurance, each catering to a specific requirement. The key is to know the risks involved in the industry. But since natural disasters can happen anywhere, it is best to be protected from hurricanes, flooding, etc. To protect your business against disruptions or shutdown, here are some of the natural disaster insurance policies to take into account:
- Commercial Property insurance—As the name implies, this type of coverage manages the loss or damage of physical business assets including pieces of equipment, furniture, and office property or buildings caused by a natural disaster such as a hurricane. Bear in mind that it does not provide coverage for company vehicles or flood damage. You may want to purchase Commercial Auto insurance for that.
- Commercial Flood insurance—This type of insurance protects the restaurant against substantial financial losses due to damages as a result of flooding. It protects physical business assets such as pieces of equipment, tools, furniture, records, and merchandise from floodwater damages. If your business is located in a flood-prone area, consider purchasing Commercial Flood insurance to avoid shelling out a considerable amount of money in case the restaurant gets affected by a hurricane. Remember you need to have this specific type of policy to be protected from flood damage, other insurance policies will not cover flood damage.
- Business Interruption insurance—Restaurants rely heavily on day-to-day operations. But what if a disaster strikes and you need to close the business temporarily? This can mean huge financial losses. You can avoid this from happening by carrying Business Interruption insurance. This coverage will pay for the estimated lost revenue if a hurricane or any natural disaster forces a restaurant to stop operating. Even retailers and wholesalers can benefit from having this type of insurance.
These are just some of the things that restaurant owners should do during hurricane season. Accidents can happen in a restaurant, and the same holds true for forces of nature. Hurricanes can cause damage and business interruptions, but you can do something to prevent them or at least reduce the impact. Make sure to have a detailed emergency plan in place and let everyone know about it. Carry proper insurance and stay updated with weather bulletins in your area. In the end, what matters is you and your employees are safe, and your restaurant can continue its operations after a disaster.