No doubt that small businesses will be the hardest affected from the current COVID-19 pandemic. The bigger businesses have a better chance and means of surviving; however, small businesses tend to live only with a few months of cash flow (at most), so when something as significant as this hit, it can be devastating not only for the small business owner, but also for the employees they support.
If you’re worried about whether your business will survive the COVID-19 health and economic crisis, you’re not alone. Here are a few points how to preserve your cash and access to survive COVID-19.
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Stabilize Your Finances.
First, do whatever you can to preserve your cash. Be mindful of how you manage your expenses by monitoring your cash flow. In fact, an analysis from Deloitte recommends, “In times of uncertainty, it’s generally a good idea to swap fixed costs for variable costs wherever you can — preserving your core business while increasing your flexibility on the fringes. Selling assets and then leasing them back is one way to raise emergency cash.
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Access Small Business Funding
For small businesses, it is best to have at least three months of cash on hand but if this is not the reality for you, financing might be a good choice to consider. Fortunately, the government already provides multiple financial programs for businesses that are experiencing financial difficulties from Covid-19. Some of these are SBA Economic Injury Disaster Loans and Emergency Economic Injury Grants, Paycheck Protection Program and some online lenders that are also another good source for SBA loans.
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Maximize Your Online Options
Increase your business network online since millions of people are at home and still very active in purchasing everything. This is also a good time to enhance your digital assets such as website, and other social media profiles. As your business builds its online presence, you might consider expanding your customer payment options. If you give consumers as many payment options as you can, you open up more opportunities for customers to pay in the manner that they are comfortable with—giving them more incentive to become (or continue as) part of your loyal customer base.
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Keep the Team Together
It’s easy to keep your team together when business is booming and growth opportunities abound. However, things aren’t always so rosy and, as the great. Businesses that have a better position to keep employees have the ability to ride out the coronavirus crisis. For businesses that have had no choice but to furlough employees, try to encourage them to stay connected and engaged in business somehow. Start with fully communicating the situation and give the team a chance to vent, ask questions, and fully understand the situation.
If you need more financial insights, contact FAS today and let us support you! Email us at admin@fas-accountingsolutions.com or call at 713-855-8035.
