8 ways to protect your business during the Coronavirus crisis
Let’s be honest. There is much we don’t know about the economy right now. Its volatile swings have most people wondering what’s next. So let’s focus instead on what you can do to best protect your business today.
Preparation and creativity are key.
Consider the worst-case scenarios for your business plan’s most critical success factors. Begin planning how you might redeploy efforts (and cash) that will bolster sales. If you don’t have an online presence, for example, now might be the time to create one. With many stores and restaurants already operating on tight margins during a normal economy, an increasing number of them have been forced to offer delivery and curbside pickup on their products to stay afloat with today’s situation.
Talk to your bank.
We cannot stress this enough. Some banks are offering relief to those businesses that have been impacted by COVID-19. For example, some existing loan customers may qualify for payment deferments. Or business credit card account holders may be eligible to skip payments, have late fees waived or may be considered for a revised payment plan with reduced payments and fees. The Small Business Administration is also offering financial support, which includes low interest loans. Your bank will know all of the options available to you.
Watch for opportunity.
There is suddenly a glut of great talent available. Many workers have been let go or have had their hours reduced recently due to a collapse in revenue. If feasible, this may be a great time to add to your work force or leverage contract and freelance workers.
Communicate transparently with your customers: We are all in this together.
Customers will likely empathize with companies facing a crisis as long as you communicate with them properly. Describe the steps you’re taking to mitigate risk and give them insight into how you’re helping the community.
Improve cash flow.
If you have no formal collection system, now is the time to create one. Perform regular follow-ups with customers who fall behind to remain high on their bill-paying list. As we just mentioned, we are all in this together, so while you have a business to run, show compassion. To further speed collection, consider collaborating with your bank to help manage payments so customer funds are deposited on the same day they’re received.
Protect against fraud.
Accounting irregularities, price gouging and outright fraud is increased during economic downturns. To protect against fraud, adopt stronger internal controls. Your bank should offer tools to help you prevent fraud.
Manage your risks.
If you can lock in prices on raw materials now, you may be able to hedge against spikes down the road. Reward employees who foresee and avoid risk and make risk management a priority at every level of the organization.
Don’t plan too far out if you aren’t willing or able to adapt quickly. This situation may impact business for a while, so show leadership within your team. Be prepared to develop new plans and policies. Don’t get stuck in decisions you made last week.
The coming weeks and months will be challenging. Taking the proper steps now can make your company stronger once the pandemic runs its course.