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How to Keep Your Business Afloat
During the Coronavirus Pandemic
Right now, the global coronavirus (COVID-19) pandemic is wreaking havoc on businesses both large and small all over the world.
For large enterprises, there's little to do but hunker down and try to limit losses as forced closures caused by the outbreak continue. For smaller businesses, though, every moment of business disruption that passes may bring them closer to ceasing operations for good.
For the small businesses fortunate enough to have built up substantial cash reserves that can carry them through the crisis, now is a time to retrench and devise plans for their eventual reopening. For the rest, it's a time to try and cobble together a strategy just to survive.
According to research by the JPMorgan Chase Institute, the average US small business falls into the latter category. There's also plenty of anecdotal evidence to suggest that their European counterparts are in much the same shape. So, to help business owners in the unenviable situation of trying to shepherd their business through this crisis here's a guide on how to keep your business afloat during this pandemic.
Begin by Reducing Expenses
For any business facing cash flow difficulties right now, the first thing to do is cut as many ongoing costs as possible out of monthly expenditures. That means an immediate suspension of any and all pending discretionary business purchases.
These might include:
- Recurring office supply orders
- Charitable donations
- Employee training materials and session costs
- Fixed asset purchases (office furniture, computers, etc.)
In severe circumstances, it may even be prudent to attempt to renegotiate the costs of leased office space or arrange a deferred payment schedule with the lessor. In a situation like this, it's in the lessor's best interest to work with cash-strapped businesses to prevent them from defaulting on their lease agreements.
Attempt to Affect a Business Continuity Plan
Owing to the sudden nature of the coronavirus pandemic, the vast majority of small businesses were caught flat-footed when the orders came to shutter their offices and retail spaces. Most had no business continuity plans to speak of, which meant they had no idea how to try and continue operating as the situation unfolded. Like it or not, coming up with just such a plan and finding a way to make it work is now an absolute necessity.
For businesses now facing office closures, the immediate necessity is to gear up to support employees to work from home. If technically feasible, this is best accomplished by configuring an on-site VPN solution to provide secure, remote access to desktop computers in the office. In some cases, existing office routers will already include this functionality. If not, signing up for a virtual desktop service can provide a quick way for small businesses to get remote employees up and running with the business software and file access they need to work.
For businesses facing retail location restrictions or closures, the first priority is finding some way to keep revenue flowing by embracing alternative business models. This can come in the form of setting up quick eCommerce shops to handle online orders, or by signing up for a cloud phone service to allow home-bound employees to take orders directly. It's a strategy that can do wonders, as even tiny family farm shops in rural France are now finding out. And restaurants can try and shift to a kerbside pickup or delivery model, as at least 1,200 Chicago-area locations have in response to shutdown orders.
In any case, the more effective a business can be at reorienting their operations, the greater the chance they'll continue to bring in enough money to remain in business. Also, affecting a functional business continuity plan should help to forestall employee layoffs, which should be a key goal, as well. After all, it does little good to ensure that a business will survive the crisis if it will only emerge from it without the employees needed to get back to normal operations.
Double Down on Marketing, Outreach
Although it's tempting for small business owners to cease their marketing operations to save money as this situation plays out, that's the opposite of what they should do.
Instead, they should be taking steps to double down on existing marketing efforts. For examples, they need only look at how businesses responded in previous crises, and how it helped contribute to their own recovery – and that of the broader economy.
In doing so it's important, however, for small businesses to be judicious and save money wherever possible. To do it, it's a good idea for small businesses to embrace business intelligence solutions that can help them narrow their marketing focus on their most valuable customers (check here for the recent BI software rankings). Although it may seem counterintuitive to invest in such solutions under the circumstances, it's the only way to make sure every additional marketing dollar spent is likely to yield results in terms of increased sales. It's not an effort that a small business can afford to get wrong at a perilous time like this.
It's also an excellent time to ramp up efforts at customer outreach. There are already grassroots efforts to encourage those in quarantine to continue to patronize local businesses as a means of helping stave off the worst possible economic effects. By leaning into such efforts and reaching out to customers, small businesses may gain significant insight into their needs during this crisis to serve them better. Plus, such a strategy has the knock-on effect of letting local residents know that the business is continuing to operate as the situation continues.
Take Advantage of Government Business Support
No matter where you look, governments around the world are pulling out all of the stops to inject money into their economies to blunt the economic damage wrought by the coronavirus. Much of that cash is earmarked for small businesses to help them get through the crisis. In Europe, virtually every national government has revealed plans to rescue beleaguered businesses – with some going as far as to pledge unlimited support to keep businesses afloat.
In the US, the federal and multiple state governments are in the process of rolling out a vast array of small business relief measures. Depending on their specific circumstances, most businesses should be able to avail themselves of one or more of these programs. Doing so can provide an essential financial backstop should the preceding measures fail to keep the business afloat. Of course, it's essential to examine the terms associated with each program to make sure they're worth pursuing before making any commitment.
Work Hard to Survive
For any business that was in decent financial shape before this crisis began, the above steps should provide a roadmap to staying afloat until the situation improves. With some effort, hard work, and a little luck, it should be possible to emerge from the crisis with a leaner and more efficient operation that's ready to thrive once again. In the end, that's the best outcome any business can hope for in this unusual and unexpected circumstance.
About the Author
Philip Piletic closely follows the impact of technology on education, and its evolution from traditional to modern methods that include e-learning, courses, gamification, and others. He has also helped the Sydney-based IT & Business school in developing their IT courses.