As the Covid 19 restrictions are beginning to lift via the federal Government’s 3 stage plan, it’s important for small business owners to start working on their own recovery plans.
Although the government has aided businesses via Job Keeper and other funding measures, in the end it is up to you as the business owner, to take the reins and steer your way through the next stage.
Here are some tasks for as you to look ahead and develop a plan to ensure you come out of the shutdown as strong as possible.
Assess your current status
The first step in developing a rebuilding plan for COVID-19 is determining just how deeply your small business has been affected.
The most obvious assessment is your income and your profit and loss. Just by comparing your previous year to date figures with this year’s figures, you can see how the trend is going. Then break it down into comparing quarters and months to see how the most recent changes in income and expenditure have affected your business.
You may find that although your income is down, your expenses may have dropped as well.
If you have been able to access Job Keeper payments for staff that you wanted to keep on your team during the shutdown, factor this into the next stage of your business. To keep these staff employed once the Job Keeper payment cease, (most likely in September), you will need to create a new business plan to maintain this.
If you’ve cut your advertising and marketing budget down, or some of your customers have moved away to access services you can no longer offer, factor in the steps you need to take to fill the income gaps.
In every crisis there are opportunities.
Reviewing how your industry has been affected by the coronavirus pandemic also may help you identify future opportunities. Being able to find a gap or need that’s been neglected up until now could be critical to reclaiming and expanding your customer base going forward.
Now is the time to look at what was working before that may not work as well now. See where you can adjust or improve to remain competitive. Revisit your business structure to make sure that what you did in the past is the best way going forward.
Perhaps the challenges you have faced, forced you to find a way to be more efficient. Take a good look at how your business performs and identify cost saving measures and new process that will help streamline your business, cut costs and enhance productivity.
The pandemic has shown us how important it is to be able to adapt and keep your business fluid so you can reasonably weather storms. For example, if your employees didn’t have the option to work remotely before, that’s something you may want to incorporate in your business model going forward.
Will you need funding to recover?
Unless you had a large amount of cash on hand going into the pandemic, you may need some working capital to jump-start your business operations coming out of it.
When it comes to financing your small business during the COVID-19 rebuilding period, the Federal Government has created the Coronavirus SME Guarantee Scheme.
The Coronavirus Small and Medium Enterprises (SME) Guarantee Scheme will support up to $40 billion of lending to SMEs (including sole traders and not-for-profits).
Under the Scheme, the Government will guarantee 50 per cent of new loans issued by eligible lenders to SMEs. The Scheme will enhance lenders’ willingness and ability to provide credit, supporting many otherwise viable SMEs to access vital additional funding to get through the impact of Coronavirus.
The Scheme will be available for new loans made by participating lenders until 30 September 2020.
If you’re considering financing to help rebuild, keep in mind that borrowing may be competitive, as lenders want some reassurance that loans can be repaid.
Reviewing your business and personal credit scores, as well as your business and personal financials can help you gauge how likely you are to get approved for funding.
Please contact us to assist with these important steps, as we can ensure your have the best approach to both accessing funding and repaying the loan.
Develop a rebuilding timeline
There may be a bewildering number of things you want to do to recover following COVID-19, but prioritizing each step gives you a plan to follow.
Setting a rebuilding time line will help you establish your most important actions first.
For example, your immediate goal may be securing funding for your business. Once you’ve done that, you can set a time line for rehiring employees, then restocking inventory and, finally, reopening your doors if your small business closed as a result of the pandemic.
In the initial stages of COVID-19 recovery, you may want to check in with us on a weekly or fortnightly basis to ensure that your recovery is going to plan.
This is particularly important if you’ve secured capital to fund your business, because you don’t want to waste time on activities that aren’t delivering a solid return on your investment.
Create a contingency plan
Some of the things you have learned during the current pandemic can help you insulate your business from future shocks.
Building up liquid cash savings for the future is one way to ensure your business viability. You may also choose to focus on paying down your debt and trimming nonessential spending to keep your budget in check.
There are many steps ahead, so be sure contact us, so we can assist you create a plan just not for the recovery steps, but also for a thriving future. We want to help you.