Millions of small business owners are feeling the financial stress that is being brought on by the coronavirus (COVID-19) pandemic nationwide. Big cities and small towns are being shut down by state and local government officials to help prevent the transmission of the coronavirus, and this is resulting in lost revenues for restaurants, retail shops, bars, nightclubs, and just about every other type of mom and pop business.
When the economy grinds to a halt, small businesses are usually the first to go under if they have cash flow problems, or are running on ultra-thin margins. The U.S. government has announced a massive $1 trillion stimulus package that includes $300 billion to help keep small businesses afloat and reduce layoffs during these challenging times, but that might not be enough. This Balboa Capital blog post discusses ways to weather the economic storm that has resulted from the coronavirus.
Go over your financials… today.
We are in the middle of tax season, and the government just announced a 90-day tax extension that applies to up to $1 million in payments for individuals, and up to $10 million for corporations. Whether you have already filed your business taxes or are still waiting to complete your return, now is the time to look at your financial situation with a fine-tooth comb. This is the only way to get a picture of your company’s financial health.
When examining your balance sheets and cash flow statements, pay close attention to things like inventory, accounts receivable, net income, sales trends, and fixed assets. Of course, look at the current economic climate, which seems to change daily as of late, and determine how it might affect your business. For example, if your business relies on a few clients that have temporarily halted their operations as a result of the COVID-19 pandemic, you will have serious problems relating to cash flow.
Keep your employees in the loop.
With the news about the coronavirus changing by the minute, your employees have a lot on their minds. They are concerned about their health and well-being, and wondering if their jobs will be in jeopardy if the economy continues its descent. That is why you need to keep them informed as to what is going on with your business in terms of sales revenue, a change in hours of operation, and policies for a potential work at home scenario.
You can relay information and updates to your employees via email, video chat, or quick mandatory meetings. Doing so on a regular basis can help reduce workplace panic, and minimize any anxiety that your employees are experiencing.
Establish cleaning protocols.
All of us have been inundated with news stories that explain the importance of keeping things clean and sanitized. Our nation’s leading medical professionals have repeatedly said that doing this can help prevent the spread of the coronavirus. If you already have a cleaning system in place for your kitchen, conference rooms, offices, and workstations, that is a great start.
However, now is the time to take your cleaning to the next level. Stock up on hand sanitizers, anti-bacterial soap, spray disinfectants, and other virus-fighting products. Having your employees disinfect their workspaces every day is an absolute must. In addition, have them work as a team to wipe down door handles, computer keyboards, telephones, kitchen appliances, office printers, and anything else that is utilized often.
Reconfigure office space.
According to most doctors and CDC experts, people should practice “social distancing” when they are grocery shopping, walking around places that are filled with people, and all other social situations. The recommendation is to remain at least six feet away from each other in order to decrease the chances of catching the coronavirus.
Many businesses are following this lead, too. To give your employees some peace of mind, consider moving desks around so they are not sitting close together. If you do not have the office space to do this, you might want to send some of your employees home and allow them to work on a remote basis.
Apply for short-term funding.
Small businesses like yours are the anchor of the United States economy; they make up 99.7% of all firms in the country, employ 60 million workers, and generate 45% of economic activity. Simply put, we need to do everything we can to keep small businesses in business.
If the coronavirus has put a dent in your cash flow, a short-term business loan is a viable solution. You can use this type of loan to pay for just about every daily business expense you have, such as employee payroll, bills, and inventory.
Balboa Capital hopes that you found these tips to be helpful. We remain optimistic that we will get through this, and we look forward to seeing Main Street USA buzzing again and fueling the economy.