Like a tornado hell bent on destroying everything in its path, COVID-19 continues to ravage the business landscape throughout the country. Sadly, many small businesses won’t survive the assault. Recent research has shown that 52 percent of small business owners expect to close within six months, with 12 percent saying they may have to close within a month; 20 percent say they can only stay afloat for an additional three months. On top of that, consider this: 30 million small business jobs are vulnerable, and companies with fewer than 100 employees have been the hardest hit.
Does this describe you? Are you perilously close to shuttering your business and filing for bankruptcy? You’re not alone. But that’s hardly any consolation when you’ve sunk your life savings into your dream, only to have it upended by a global pandemic that no one saw coming.
If you are one of the many businesses that has experienced a blow to threaten your very existence, read on for some things you can do to perhaps avoid this tragic scenario.
Have you gone through all your expenses and eliminated everything that is non-critical?
Start with your income and assets, then categorize your budget expenses. Here’s where it gets painful: you also have to eliminate or reduce nice-to-haves. Only once you’ve cut the fluff from your budget can you take a second look at your essential spending, suggests Forbes.
Have you checked things like insurance or that extra module in your CRM
that you never use?
Take a good look at your CRM system and see how it can help your business, perhaps by flagging all lost invoices. This results in more outstanding invoices, translating to more money in your company's pockets. Additionally, you can mitigate your insurance costs in times of crisis by calling your insurance provider and asking where you can cut yet still get the protection you need. You’ll should have a business owner policy, which is an insurance package that provides you with greater-than-usual coverage to ensure your business can survive a tough economic crisis.
Have you filed for PPP or SBA disaster loan yet?
Hopefully you filed for and started receiving the PPP (Paycheck Protection Program), which is an SBA loan that helps businesses retain their workers during the COVID-19 crisis.
If you got help from the government stimulus, use the finds wisely. The PPP must be used for payroll and a few limited company expenses, but the EIDL (Economic Injury Disaster Loan), if you got it, can be used to help with general cash flow. Use the stimulus wisely, not for pay increases but to ensure your business remains fluid.
Have you spoken with your landlord about different options?
If you’re renting or leasing your space, you’ll want to have a conversation with the landlord to see if there’s anything that can be done about temporarily lowering costs or deferring payments.
Don’t worry: you’ve got some backup. In March, the federal government passed the “Coronavirus Aid, Relief, and Economic Security Act”, or the CARES Act, which includes measures for individuals and businesses affected by the social distancing and shelter-in-place mandates enforced on a state and national level.
This relief package is beneficial to small business owners, but keep in mind you may still have to initiate some difficult conversations with your landlord. Based on what the CARES Act addresses regarding rent, here’s what you’ll need to talk to your landlord about. Topics to discuss include:
- Rent reduction
- Rent referral
- Rent abatement
- Flexible payment options
Keep in mind, your landlord is in just as a precarious situation as you are. They should be motivated to do all they can to keep you as a loyal and paying customer. Keep the conversation respectful and on the level.
Have you thought about pivoting the business?
I spoke in depth on this concept in “How to Pivot Your Small Business Strategy During COVID-19,” so revisit it or check it out for the first time. You’ll find lots of helpful information in there about devoting the time necessary to take a fresh look at your business, tweak some things, and put yourself in a position to roll with the punches in a post-COVID-19 world. Review your business processes and consider shifting your business model to one that is best positioned for survival. Hopefully, if you can easily pivot, you’ve already done it! If not, get in touch with our business coaches for a fast track lesson.
Have you used the extra time to do more social media marketing?
There’s never been a better time to up your social media game. Reach out daily to your followers, tell them what you’ve been up to, keep them updated on your opening protocols, etc. Let them know how you’re keeping them safe while at the same time addressing their product or service needs as best you can. Share your COVID-19 stories, both positive and negative. Get support from the community. You will need it in the months ahead as you rebuild.
Are you communicating enough with those who can help you?
This last one is where we come in. Chances are, you’re still feeling a bit out of sorts right now. Owning your own company can be quite isolating, and even if you’re good at networking with others in your same industry, every business’ needs are unique and different. You don’t need general advice right now; you need actionable guidance from a trusted professional who’s been through stuff like this before and can advise you on next steps.
Contact us for a free 30-minute consultation today. We’re all in this together.