As much as we all hate this, it’s becoming clear that coronavirus is going to significantly impact economic activity over the coming few months.
If you own a business and you haven’t started preparing, you need to start right now. Here are some important tips to consider as you work on your plan. If you’ve already started taking steps, let’s see if we can help tune things to keep your business going smoothly through these troubled waters.
1. Accept that you’re probably going to have some rough months. Unless you’re in an industry that directly profits from current events - congrats to the toilet paper companies! - there are probably going to be issues soon with either revenue or staffing. This isn’t your fault. You started your business for good reasons, and this virus doesn’t change them. The goal right now is to survive until we can get back to better times.
2. Focus on your best offerings. Now isn’t a time to experiment or take risks. There are the key services or products you have that really bring home the bacon, and those are the ones you need to give your time, attention, and money right now. That will allow you to come out strong financially once circumstances improve and give you cash to keep innovating and expanding.
3. Develop a plan for interruptions. Hopefully this won’t be necessary, but we all need to have a plan in place for in case most of our employees have to stay at home for a couple of weeks. If remote work is a possibility, set things up as best you can to make that effective within your IT environment. If it isn’t, figure out how you’re going to pay your employees, or not, as appropriate. Keep in mind that if you’re offering a physical product or service, there will likely be some pent-up demand later on - people will still need to get their plumbing fixed and buy new equipment, they may just wait a month or two to do it. Use your judgment with your own employees and situation, but I think intelligent use of employees advances could be useful for tenured employees that will be needed as part of the rebound.
4. Understand your cash requirements. Plan your cash needs for the next couple of months in light of pessimistic revenue targets, so you won’t be startled later on and can start preparing how you will deploy your resources. The more conservatively you make yourself think, the wider range of circumstances you will be prepared to handle, from a minor interruption to something that takes your team mostly offline for multiple months.
5. Understand your credit options. Money is incredibly cheap right now - cheaper than it has been in at least a decade. If you might need a line of credit or some other form of financing, talk to a loan officer ASAP, before they run into issues shutting down their own offices. Trust me, they want your business right now.
6. Understand that everyone else is in the same boat. It doesn’t do your suppliers or your landlord any good if you go out of business. If paying the rent this month is going to kill your business, try to strike a deal. If you can’t commit to your typical inventory order because you’re not going to have customers the next few weeks, make different arrangements. If they have a clue, they’d much rather keep having your business for years than put you to the chopping block right this second.
As business owners, we are no strangers to hanging on and persevering during the tough times. While we hope for the best case scenario, preparing for something less optimal would be wise. All the best to you and your business during this time.