With offices barren and commuters off the roads, today’s business landscape is a first for many of us — but just because we’re in an unprecedented period doesn’t mean entrepreneurs should expect the worst. You can take several steps to come through the coronavirus crisis and emerge strong on the other side.
I’ve been poring over emails from colleagues, chatting with clients and reviewing advice from those in the entrepreneurial world who have successfully weathered economic downturns. I’ve put together some of the most useful information I gleaned, in hopes that it can help you get through this period with your business intact.
Cash is King
Spend on What Really Matters
Fight to Hold on to What You’ve Built
Make a Plan for When This Ends
1. Think Differently - Brainstorm with Colleagues, Competitors
Many small- and medium-sized businesses are wondering if they’ll be able to keep employees on the payroll during a downturn. You have options that can hopefully prevent you from having to lose good staff members — consider talking to your employees and brainstorming. Do they have other capabilities and talents? How can you use those skills to pivot your business into one that will continue to thrive in this climate? For instance, perhaps you have one salesperson who has been offering to experiment with a cloud-based solution to your software that would allow remote workers to unite. If that staffer can no longer travel and make sales, now could be the time to have them dedicate their efforts to working on that solution. You could be able to get it up and running during this period, offering you a new option to offer those who are switching to remote work.
This was emphasized by entrepreneur Mark Cuban during a recent LinkedIn Live event where he discussed coronavirus’ effects. “Since you have holes in your schedule, it’s a great time to experiment with new lines of business and see what sticks,” he told readers.
You may even consider collaborating with competitors to provide shared offerings. Perhaps you can work together to create solutions that one of you would be able to offer on your own.
2. Cash is King - Work with Lenders, Suppliers on Terms
If money is tight, there are myriad resources available to help you out. For instance, the US Small Business Administration is encouraging entrepreneurs to apply for Disaster Assistance Loans if needed, and many local offices are offering grants, such as the Employee Retention program for businesses in New York City or the Small Business Resiliency Fund in San Francisco.
You can also talk to your bank about working together to change any loan terms that would allow you to decrease current payments. Perhaps you can lower your interest rate, skip payments and add them to the end of your loan term, or pay interest only during this period rather than paying principal.
Also talk to suppliers about deferring payments if possible. This goes from the phone company to the business that makes your products. Work with everyone in your orbit to see how you can negotiate a deal that will help you stay in business during this period. Remember that “Cash is King.”
3. Spend on What Really Matters
Every business has costs that are for things that are “nice to have” but aren’t essential. Now is the time to reevaluate all of those non-critical areas and cut your costs to the bone. Perhaps you have food delivered to the office twice a week for staff meetings, or you offer free product deliveries to customers through a third party that your business pays. It’s time to determine which of those services are absolutely necessary right now, and if not, they should be put on hold to buy you some time to get through the crisis, so you can continue spending and investing on what really matters. You may even need to cut salaries temporarily or furlough employees, if it means saving the business now and reverting back to normal after the crisis ends.
4. Fight to Hold on to What You’ve Built
You’ve worked hard to create your business, so you should fight just as hard to keep it going even though the economy is down. “Your main priority is the survival of the business,” said entrepreneur and Shark Tank investor Robert Herjavec during a recent Twitter Q&A about the coronavirus. “Protect the business first -- it’s not about guts, glory, loyalty -- it’s about survival right now.”
There are many ways you can do that. If you’re prepared to offer lower prices than usual, change your services, or even adjust your business model, then now is the time to take action. Take a big-picture view of your organization and get a plan of action into place now that will allow this
5. Make a Plan for When This Ends
No one can foresee when the coronavirus emergency will end, but we know it will happen eventually. To prepare for that, create a business plan that allows you to capitalize on what consumers’ needs will be after the crisis is over. This might mean planning events with your city (which will no doubt be looking for ways to bring in business) or offering discounts for new customers.
“Rather than focusing on how bad it is, focus on how you can use this time to connect with your future customers,” Cuban said to his LinkedIn audience. “This is also a good time to clean up all the little messes every small business has. Everyone has things they wish they could redo.”