The COVID-19 outbreak doesn’t only pose a threat to our health and safety, but it also wreaked havoc to businesses worldwide. The majority of small businesses felt the negative effects as a result of the pandemic which made their financials suffer.
The pandemic is still on-going but new policies to adapt to the situation are continuously being provided by authorities. We are slowly transitioning to a new normal and it’s also the time to rebuild your business to better fit this new reality. Here are some tips to help your business get back on track:
Know the Financial Damage
The first thing to do before rebuilding is to assess how deeply your business has been affected. Start with your numbers that are shown in your financial statements. Compare this year to your last year’s number to see how much your business earned or lost starting when the pandemic hit.
Let these numbers tell you the full situation of your business to better prepare your rebuilding plan. Work with a trusted bookkeeper to gather these financial insights.
Update Your Business Plan
You should also revisit your business plan. See if these plans can still be implemented and maintained during these times or if your team can handle it in case you have laid off some employees.
Consider every change that your business underwent when assessing the damage of your business to prepare your rebuilding plan better.
Assess Whether You’ll Need Funding to Recover
Since revenue may be slow and you might have exhausted your cash reserves by now, evaluate if you will need additional funding for your business to recover. The government and SBA have relief programs that are designed to help small business owners to keep their businesses going during this time.
But keep in mind that these programs existing don’t automatically mean that you should apply, measure carefully if you really need the help.
Update Your Budget
Look at your financials again and assess what expenses you can cut. Tighten your budget especially if you have limited or slow cash inflows. Expenses that are not strictly necessary to keep your business going should be paused or eliminated by now. You can also look for cheaper alternatives to better fit your updated budget.
Again, work with your bookkeeper for this as they can help you make the right decisions for your financials.
Develop a Time Line for Rebuilding
Create a realistic timeline for rebuilding your business to control expectations. Keep in mind that this will not happen overnight and it will take some time to get fully back on track.
Make use of cash flow forecasts to have an idea of where you will be in the next month or quarter and base your timeline on that. You also have to keep on top of new policies released by the government to fully reshape your business for the new normal.
Prepare Contingency Plan
While this pandemic may seem like a once-in-a-lifetime event and you will hear other people say ‘it will never happen again’, you should use what you have learned from this crisis to prepare for the next one. This is not to say that we are asking for more disaster situations, but this is more preparation because our situation now is still uncertain.
Being prepared and applying what you have learned due to this pandemic will make your business stand firmer and stronger through difficult times that will come in the future.
Even though the pandemic is still on-going, it is not a bad idea to start rebuilding your business to better fit the new normal situation that we are transitioning to.
If you need help with your taxes or bookkeeping, contact us today at firstname.lastname@example.org or at 713-855-8035.