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Recovering After The Impact Of A Natural Disaster On Your Business

Natural disasters within Australia are not unheard of, unfortunately. When fire, floods and tropical storms threaten business operations, employers must often make hard decisions about leaving their shops to weather what nature throws at them.

Over the last few years, the news has often featured the ongoing aftermath of natural disasters on towns and their businesses. The process of recovery amidst this can be a daunting, stressful time for businesses and their employees.

Rather than assume that this process will be quick and that operations will be as usual within a short period of time, save your business the stress of rushing through this recovery.

You can break down the recovery process of your business from a natural disaster into three time frames:

  • Within the first two days
  • Within a week
  • Within a month

Within The First Two Days

You should contact all of the business’s staff to confirm their location and if they’re safe and well. Then, once their situation is confirmed, find out if they’ve been affected, if they can return to work and, if so, when.

Then, conduct an initial damage assessment. If you can safely access your premises, create an inventory of destroyed and damaged items with an estimate of replacement costs. Include photos of damaged items if possible. Don’t clean up until you have contacted your insurer.

Contact your insurer and discuss your damage assessment, level of cover, how quickly your claim can be processed, how much and in what form a claim will be paid and when an insurance assessor will visit.

If it’s safe to do so, salvage any remaining equipment and stock.

Within A Week: Begin Recovery

Begin actions that will assist you in re-opening your business when you are ready. Make a list of any key equipment, stock or activities required for the business to become operational. If any key equipment or stock has been salvaged, store it in a secure location.

Contact your key customers and suppliers, so they know your business has been affected and if existing orders will be affected. Work with your customers so they can continue to receive the goods or services you usually provide and contact them again when you’re ready to resume trading.

Contact your lender and accountant to assess your business’s situation. Assess if you can trade temporarily. Do you have forward orders you can complete or sales you can complete from salvaged stock?

Access any business information held in cloud-based software – this can assist you in retaining normalcy as the information held in the cloud is unlikely to have been affected by the situation at hand.

Consider contacting government agencies that may help affected businesses, such as the Australian Government’s Disaster Assist website.

Within A Month: Further Steps To Aid Recovery

If it is necessary, look for alternative business premises. This may be due to unsafe conditions as a result of the disaster (such as water damage from floods or destruction from fire)  It will need to be safe, and you need to consider whether your staff, customers and suppliers will be able to access the alternative premises.

Collect all business records that have been salvaged and decide if off-site copies are retrievable (such as from the cloud or an off-site server). Where there are gaps in records, consider alternative sources to help you reconstruct your financials. You may like to talk to your accountant at this stage for assistance.

In any case, recovering from a natural disaster isn’t a speedy, short-term solution. Consulting with your accountant can assist you in determining what you may be able to salvage financially if it is required, and what your situation is in the meanwhile. Look towards the long-term.

If you’re someone who often finds it difficult to make large lump sum payments for goods or services, you may want to consider looking into “Buy Now Pay Later” services.

Buy now pay later essentially means that, rather than paying in a full lump sum payment for a product or services rendered, there may be an option to pay through instalments of a certain amount over a set period to make the sum of the full amount in total. This method should allow you to pay in full for the product or service without overly straining your finances – you pay back what you can, as agreed upon when you begin the buy now pay later service.

Some popular buy now pay later services include Afterpay, Zip Pay, Brightepay, and some credit card networks such as  Mastercard and Visa, can offer buy now pay later arrangements.

Though it can be a convenient, immediate solution, it may be challenging to juggle the necessary repayments with other financial commitments. It’s not always the most appropriate method for people, and you should bear in mind your situation and ability in paying back the amounts. 

Before you sign up, keep in mind: 

  • It becomes easier to overspend with buy now pay later services, so know your limits on what you can and can’t afford.
  • You will be charged fees and costs to use the service, which can add up to a princely sum in and of itself.
  • Keeping track of your payments can be tricky if you’ve signed up for multiple services.
  • It could affect your loan applications for a car or mortgage as lenders consider buy now pay later spending just as much as your credit score.
  • Late repayments can appear on your credit report, which affects your ability to borrow money in the future.
  • Layby can be a cheaper alternative to buy now pay later, with no account-keeping or late fees to consider

If you are someone who could make use of BNPL services, you may wish to:

  • Ensure that when using the BNPL service, you stick to a set limit on what you spend so that you can comfortably pay it back later. 
  • Aim only to have one BNPL account at a time to manage payments through, rather than confuse yourself with multiple payments across different providers.
  • Always budget for bills, loan payments and BNPL payments, and 
  • Rather than use your credit card for payments to your BNPL account, consider linking to your debit account instead.

If you would like assistance in planning your financial future, help in managing your budget or some friendly advice, see us for a chat about what we can do for you.

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John Briggs

Jane Noller has been my accountant for the last 15 plus years. I can testify to Jane’s professionalism and expeditious manner in dealing with the day to day issues that surrounds our business accounting.

John Briggs

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David and Alison Parker

I have been consulting J L Noller and Co. (more specifically Jane) for six years and during this time I have found her to be professional, efficient and easy to discuss all accounting and taxation matters with. Her office team are all polite and friendly also.

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I have used Jane & the team for the last 6 years for all of my business & personal accounting needs. They have always been professional, easy to talk to & available when we have needed assistance.

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Carl Gillmore Landscape

John Briggs

Jane Noller has been my accountant for the last 15 plus years. I can testify to Jane’s professionalism and expeditious manner in dealing with the day to day issues that surrounds our business accounting.

John Briggs

Registered Building Certifier