Altus Provides Five Tips to Cash Flow Recovery When Disasters Strike
September 12, 2018
Disasters – man or nature made – can strike at any time. The Federal Emergency Management Agency (FEMA) says that forty to sixty percent of small business never reopen their doors following a disaster. It’s an unfortunate statistic for any business owner trying to get back on their feet after experiencing any catastrophe: hurricane, fire, flood, tornado, security breach, riots, etc. Altus has put together five cash flow recovery tips collected from our experiences as well as industry experts.
1.) Develop a Disaster Recovery Plan. “During Hurricane Katrina, I had a client that left New Orleans with his company’s servers in the back of his pick up truck. It wasn’t ideal but it was his best option at the time because they didn’t have a D/R plan,” says Christina Reed, marketing director at Altus. Your company should have a plan to guide actions to protect the company under extreme times. Communicate this plan with key stakeholders and management teams so that they know how to prioritize their activities to get your business running as soon as possible.
2.) Data Back Up. If you experience damage to your IT Infrastructure or prolonged power outages you will want the ability to access your data to continue operations. “Every day you are down you are losing time, money and potentially customers,” says Steve Michaelson, Altus’ Chief Technology Officer. Consider off site options or the cloud for backing up your critical data. When evaluating vendors, make sure to verify they are SOC II certified to protect your customer data with the highest levels of security and compliance.
3.) Focus on People First. After assessing the damage, reach out to employees, creditors, vendors, and customers. Let them know the status of your company and bring them up to speed on relevant details.
4.) Financial Management. Time is your enemy when operating in a disaster. The longer your A/R goes uncollected the lower the chance you will collect. If your debtors are in the impacted community they may be asking you for suspended payments. In addition, insurance companies can take months to process payments for losses. Having confidence to make sound financial decisions comes down to good intelligence on the health of your business partners. Also, consider leveraging an outsourcing partner for your collections in the event your employees are not able to work remote or access your systems.
5.) Model Good Leadership. Your employees will be necessary for rebuilding. If your company exhibits poor leadership you will likely lose loyalty. Understand that your staff will be experiencing anxiety or personal loss. Express empathy, provide flexible work arrangements and offer support options to help them get back to optimal productivity.
Now that you have a plan, contact our experts to customize it specific for your business needs. With over 30 years of experience, we help leading companies gain new levels of confidence and control over their cash flow. Call 800-509-6060 to speak with our experts.