How Hurricane Season is Impacting Space Coast Businesses
By Space Coast Daily // September 25, 2019
storm-related damage has largely outpaced inflation in recent years
It’s hurricane season on the Space Coast again and for business owners through the region, this time of year brings a sense of apprehension.
While there was a sigh of relief after Hurricane Dorian brushed past the state’s Atlantic Coast, memories of deadly storms such as Hurricanes Andrew (1992) and Jeanne (2004) still haunt many in these parts.
Not only do these storms disrupt day-to-day life but the loss of life and property damage can take years to recover from.
For small businesses, the blow from a major storm can be too much to recover from as the Federal Emergency Management Agency (FEMA) recently noted that nearly forty percent of affected small businesses never reopen.
This can leave a whole in communities who rely on these businesses for the services, jobs, and tax dollars they provide.
Add to the risk to small businesses, the costs of operating in hurricane-prone areas as insurance rates never seem to go down. These cost increases add insult to injury for small business owners, even when they are not affected by a storm, as they have little say on insurance premiums.
While Brevard County officials have tried to help, the reality is that storm-related damage has largely outpaced inflation in recent years.
This is due to several factors including changing weather patterns which have altered the nature of hurricanes in recent years, as well as population shifts which have seen an increasing number of people and businesses move into low-lying areas most affect by storm surges.
In the case of the latter, this can be seen in development in space coast and other areas in Florida. While much of this development has brought new services and much-needed tax revenue into local communities, the cost of rebuilding can often be prohibitive.
That being said, the Space Coast, as with other communities on Florida’s Atlantic Seaboard has been largely spared the brunt of hurricane damage in recent years.
Notwithstanding the damage, Jacksonville received from Hurricane Matthew in 2016 and Hurricane Irma in 2017, much of the region has not had to face a worst-case scenario.
While this has benefited small businesses owners, the reality is that no one knows what the future will hold. This is especially true when it comes to predicting the unpredictable.
As such, business owners in the region are increasingly trying to protect their livelihoods from a threat which may (or may not) strike at any time.
That being said, the number of near-misses in recent years has helped some business owners to put into focus the risks to their business.
This includes everything from how to back up and secure their information systems, to ensuring the continuity of power supplies, and even determining how they will get their products to market if there is a disruption.
Doing so can help to make these businesses more resilient, but it is also a balancing act to determine which resources to earmark towards preparedness while trying to remain competitive in an ever price-conscious market.
For some business owners, this might mean taking on loans to pay for improvements.
While this approach can give entrepreneurs access to the cash they need to invest, it is not without risk as failing to plan for disruption during the payback period can be just as bad as dealing with the aftermath of a major hurricane.
However, historically low-interest rates coupled with tax breaks for capital spending have helped to spur small business owners to open their checkbooks.
In some cases, this could mean getting a long-term loan from a bank, while in other cases it could mean getting a short-term line of credit from vendors such as https://www.quickloansdirect.com/.
The latter is best suited for business owners who have earmarked a purchase for the period between storm seasons as these short-term loans are best suited for purchases which can be repaid in six months or less.
This is important as the timing of investments is increasingly as important as the investment itself.
According to the Florida Chamber of Commerce, the residual effects of a natural disaster can send a chill through a local economy which can last for months.
As such, ensure cash flows are secure enough to pay for investment has become an increasing concern for Florida’s small business owners.
One last item to consider is how any planned work will get done. This is because the Space Coast, along with the rest of the state, has a chronic shortage of experienced craftsmen. This includes plumbers and electricians.
As such, small business owners should maintain relationships with the contactors they’ll need to keep their business open when the time comes. If not, they will run the risk of being closed for an extended period and this could lead to never reopening.
The risk of damage from a hurricane is nothing new for businesses in Florida. However, the increased intensity of storms could have catastrophic consequences for owners in the region.
As such, a good defense is often seen as the best offense when it comes to protecting small businesses.
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