The outbreak of the global Pandemic COVID 19 has brought about a financial and economic crisis across all industries. Several small and medium-sized businesses are suffering and struggling for existence.
The National Federation of Independent Business (NFIB) says that almost 95% of the global small and medium-sized businesses have said that they have experienced adverse effects of the business. At the same time, only 5% of businesses have claimed that they have experienced no effects at all.
Although the business activities of a small enterprise vary greatly by the industry, SMB’s must know what all is covered in the recovery mode.
SMB’s thus must have an exit strategy to come out of the struggling economy. The plan can help your small business to be prepared to face the new normal.
If you are a small business owner and are unaware of the ways that can bring your business back, here is a small guide that can help you get through.
Evaluate the Financial Damage
The first step in developing the rebuilding plan is to assess how much your business has been damaged. This involves updating your financial statements, including profit or loss. Also, update your cash flow statements and compare them to the statements of the last year to assess how much damage you have suffered.
Have a Look at Your Business Plan
Your business plan before COVID 19 must be successful. However, you need to review it and update it as per the market conditions post-COVID. Evaluate how your business can resurface after the Pandemic.
The best way is to contact industry experts who can guide you to redevelop a business plan that is more focused on the ways of business redevelopment.
Determine if you Need Funding to Recover
Kick-starting the business from a new beginning will need an ample amount of money. There are several programs, such as the Paycheck Protection program, which is designed to provide funding for small businesses. If your business is struggling in the market, this is one of the best ways to mint some money at a time of crisis.
Apart from the above options, you can consider other funding options such as:
- Small business term loans from banks, online lenders, and credit unions.
- Business credit cards
- Business lines of credit, and
- Merchant cash advances
Each of these options has their own pros and cons. It is thus important to consider these before making a financial decision.
Revamp Budget to Account for New Spending
Re-emerging from the Pandemic may require spending some money before you earn it. This amount will be spent on hiring and training new employees in your company. You may also need some funds to advertise your products and services.
The best way is to evaluate the areas where your money is generating low or no value. You need to immediately cut these expenses to control the spending made by the business.
Make a Rebuilding Timeline
You need to make several changes after the COVID 19 crisis. It is better that you make a strategy, a list of priority tasks, and set a timeline for the actions that are needed to be taken.
The list and the timeline will help you take individual steps towards recovery and measure the outcomes at every step. Tracking the success at each milestone of the timeline is best recommended to get the best results.
Develop a Contingency plan for the Next Crisis
The current Pandemic and its effects on the market have helped you learn a lot about your business as well as the market conditions.
The challenges you have faced and the strategies you have adopted will help you prepare a contingency plan for the future.
Overall, it is best suggested that you think creatively and wisely to make decisions for your business. The Pandemic is an opportunity to prepare yourself and your business for a worst-case scenario.
Source – Forbes