There is always that moment in history where people are called upon to become bigger than what they are. For our generation, COVID-19 is a test of our collective ability to face adversities.
We are told that the effects of the pandemic on the economy will be unprecedented. This means every business owner, and every one of us for that matter will be put to the test.
For sure, we have all been placed in a very unfamiliar and uncomfortable spot. There are no applicable playbooks available anywhere for what is happening now, so we try to learn on the fly.
These times are hard, risky, and unpredictable. For businesses, only the fearless and strong will survive. We can either choose to wait this out and see what would happen next year or face the issues head-on. This will be our battle.
For entrepreneurs who want to rise above all this madness, here are some tips on how you can stay afloat amid COVID-19.
What we know so far about business conditions during the pandemic
The current crisis has deeply affected many businesses, especially those in the small business sector. Data from Yelp shows that 163,735 businesses closed as of August 31. Most of these businesses are brick-and-mortar shops like retail stores, restaurants, bars, and coffee shops as people remain locked in their homes. The number of restaurants that were forced to close down is 32,109 and counting.
Nightlife venues found it hardest to adapt since they sell not only food and drinks but also the experience. According to Yelp, 6,451 bars have closed.
For retail businesses, there were 30,374 closed stores due to the pandemic.
We also see a direct correlation between closure and unemployment rates. We all probably know someone who lost a job because of the pandemic.
Larger cities like New York and Los Angeles have seen the highest closure rates, whereas smaller cities seem to be more forgiving to small businesses.
Strategies to keep your business afloat
Here are some practical methods you can adopt to enhance the possibility that you and your business survive and come back stronger.
Tip # 1: Make tough decisions
Focus only on the things that you can control, and then face them head-on. You will spend less energy if you only think about how you can solve issues that will help you survive the situation.
To survive, you must be willing to make tough decisions. We are all going through hard times, so do not be afraid to assess your situation realistically. Think about your resources, your cash flow, and your expenses. Cut down on things you cannot handle for now. If you need to lay off some employees, do so but in a kind way. Or you may reduce their work hours and arrange their shifts in a way that would help you not to cut anyone.
Doing nothing but hiding may be tempting right now as we are being wrapped by uncertainty, but doing so would achieve nothing. Facing reality and taking action is the only way to go.
Tip # 2: List all expenses and cut unnecessary ones
This time around, you need to determine what is necessary and what is a luxury. If you have automatic payments that you can survive without, then stop. Lenders would rather give temporary relief to borrowers rather than not get paid at all.
Ask lenders for payment deferrals on mortgages, loans, or leases. You may also try to renegotiate the terms on leases or rents. At the same time, you can also renegotiate with your customers for new payment deals.
If the government offers you financial support, take advantage of it. Remember that at this time, there is no shame in getting help for your business. The economy is counting on you.
Tip # 3: Exhaust all means before laying off employees
Letting go of your people will perhaps be the hardest decision you can make, so hold on to them as long as you can. Getting great employees and training them in the future costs plenty of money and time.
What you can do is review benefits and bonuses. Maybe you can hold off club memberships, discounts, and wellness programs at least until everything goes back to normal.
Reducing payroll may sound cruel, but more people are willing to take pay cuts rather than lose their jobs. You can also try running with a skeleton crew. Look for feasible options before letting go of your people.
Tip # 4: Invest in marketing
This may sound counterintuitive, since you may not have the budget to invest in anything. But this is not the time to remove marketing if you are running a business. It is important that the general public still knows you exist.
You can be creative with it and avoid spending too much. Social media, for example, is a powerful tool you can use for free. Grow your followers by running a contest, or making yourself newsworthy. Use inexpensive ways to reach customers like your email list. If you do not have a robust client database now is the time to grow it.
Getting in touch with your client base is now more crucial than ever. Take time to help them in their time in need, and they will never forget you.
Tip # 5: Think ahead
Thinking ahead means giving your business options. Concoct scenarios that may happen. Now that we are in a new reality, many things will change. Revising your business strategy is something you can consider since your current one might not have taken into consideration the new realities.
Another way of thinking ahead is to diversify your source of revenue. Relying on just one source of income puts you at risk. You can offer a wide range of products and services to help you through this crisis. While it is true that there are plenty of successful companies that have a single product like Crocs, most have become successful because of diversification like Coca Cola Co.
Now will be the perfect time to think about new ways to strengthen and grow your business.
Tip # 6: Look for support
Join forums and online groups with like-minded people. For sure, they are also looking for some help.
Talking to other people gives us other perspectives. Research shows that people who belong to a community do better when adapting to difficult situations like the one we are in now. Many people need assurance.
Tip # 7: Be a resilient leader
Do not give up. Accept the challenges and rise to the occasion. Remind yourself that you will beat this. Just keep moving forward.
These steps should give you a roadmap to help you survive this crisis. As long as you put in the effort and stick to your strategies, it is possible to be stronger and more efficient once the smoke clears.