The novel coronavirus outbreak causes businesses to face a myriad of situations and issues that need to be solved. This extraordinary circumstance demands fast, significant and effective decisions. Moreover, the global economy is starting to get affected as the new Coronavirus spreads. Sudden shifts in stock markets affecting ISAs, the travel industry in bankruptcy, stockpiling of goods and food, China industrial production on the ground, and many other consequences are just a few samples of the impact of this pandemic.
Nonetheless, the core of the actions taken should be focusing on delivering a clear message to suppliers, clients, and employees. The goal is to lead the business fearlessly and effectively through the coming economic recession. Therefore, businesses should start taking measures to be prepared and properly positioned for the impact of this unforeseen challenge. The following are some actions to start safeguarding your business from the Coronavirus recession.
1. Keep the Engine Running
The new virus strain has turned today into a time of adjustment for all of us. A Business Continuity Plan or BCP is a great strategy to protect your employees’ health without hurting the business. BCP is an approach to maintain functioning during this major disruption. It summarizes the procedures and policies of the organization and outlines clear instructions to follow through the crisis. This plan depends on the status and principles of the company. However, a typical BCP includes communication protocols and evacuation plans. If your business does not count with a BCP, it is never too late to plan.
This represents a new ballgame for industries. To establish part-time schedules or transition to work-from-home (WFH) setups could be a potentially successful strategy, especially if you think your production will significantly decrease. Today’s technologies can turn projects into remote ones in an easier way. However, keep in mind that vague work from home policies can be risky. There should be clear guidelines and rules to keep the production engine running as smoothly as possible.
It is wise to actively engage in conversations with your employees. Platforms like Skype or Google Hangouts allow the use of video conferences and chatrooms. On the other hand, software like Collabedit or Microsoft Teams will allow real-time collaboration to work just as in on-site meetings. Likewise, project management dashboards like Asana can help to keep track of production progress, which is a key part of this type of work setups.
To have a successful CP deployed, you will need active crewmembers. It is especially important to engage senior leadership in your core team to control misinformation during the process. A selected team will be significantly helpful during the planning stages. Define a “Point Person” to develop an answer for a specific situation for a stronger and clearer plan.
2. Getting Loans: Payday Loans or Cash Advances
In this situation it is imperative to keep cash flow under control. Small businesses usually take a big part in the economic recession, so it is wise to take some precautionary measures.
Although the government is trying to help, some businesses are already struggling to cover business expenses due to the outbreak. The government is already taking measures trying to pass legislation with low-interest federal disaster loans for payroll outlays, backed by the Small Business Administration (SBA). In addition, a federal income tax deferment and the employer tax credit will allow business owners to use income tax liability to cover expenses.
However, tax returns should be filed in a few weeks. Moreover, for some businesses, it can be hard to repay those loans. This is why it can be convenient to search for another financing option like payday loans and cash advances. This type of loan can be especially useful when there is an urgency for finding the funds.
Try to anticipate expenses that your business might have, including trip cancellations and supply chain alternatives. Furthermore, try to cut down unnecessary expenses. It can be useful to start making a budget for weekly expenses. Remember to include insurance coverage quotes in your budget. Losing insurance cover during this crisis can lead to bankruptcy.
3. Implement Flexible Leave Policies
A primary concern for businesses should be putting their employee’s health and well-being first. Maintaining a flexible policy that allows your employees to take care of sick family members and children at home during school closures will boost corporate reputation. Providing benefits through leave policies is not legally forced for businesses. However, your long-term corporate reputation or your employer brand after the outbreak passes can be on the line.
The continued pay and leave usage can raise business expenditures and lead to an ethical dilemma. Companies like Microsoft and Facebook continue to pay their hourly workers as usual if COVID19 has affected them. Other organizations like Uber instead, implemented limited emergency sick payments.
On the other hand, it can be wise to extend the leave policies for employee assistance program (EAP) users. Your staff member might be in need of coping with the disease or the death of a loved one. Consider all options needed to protect your brand while choosing what will be the behavior of your business throughout the crisis.
4. Communication Is Crucial
Effective communication is the bridge between failure and success. Whether the virus affects your business directly or indirectly, implementing a multi-channel communication strategy will reduce impact. It is key to keep constant communication with employees and managers during the potential issues the process will face.
Likewise, it is essential to maintain direct and forthright communication with suppliers. Safeguarding your supply chain is essential for assuring business functions. Present your priorities within your supply chain to your providers and work together in a solution for minimizing production disruptions. If possible, suggest solutions for different scenarios. Your trader will appreciate your efforts in trying to make both of your circumstances easier. Finally, it is a crucial part of communication to let your clients know what is going on. Use social media to share information about the outbreak and let them know what actions you may be taking to help within the crisis, what to expect from your product or services, and what could happen with their orders.
5. Change Your Marketing Strategy
There is a marketing strategy for every opportunity and optimizing your online presence during this time will reinforce your brand. In these early stages, it is key to take control of easily changeable campaigns. From social media to search engine ads, digital advertising should be adjusted as needed. Likewise, evaluate your tactics for the medium term. Emphasize your efforts on your critical products or services that will remain in demand. Focusing on cutting costs where possible is always a smart choice. Businesses should adapt their marketing strategy to circumstances and landscape change. Avoiding making changes, especially if they seem dramatic at first sight, will be a long-term mistake.
Innovating your brand or boosting your product’s quality is another vital strategy to deploy during the crisis. Current successful companies like Netflix and Wells Fargo thrived under recession by revolutionizing their market and taking advantage of market changes and strengths. Identifying the features that separate your product from others and being confident in its quality will become crucial.
The novel coronavirus outbreak is forcing businesses to make unexpected decisions. This includes lowering their marketing budget, which can be a mistake. Therefore, advertising costs are dropping, providing investment opportunities. Advertising today could provide great earnings the following year. This strategy can only be successful if your customer acquisition cost or CAC allows it. Be sure to perform carefully measured tactical growth tactics.
6. Exploit Your Resources and Opportunities
On the other hand, if you have created strong connections through networking, rely on your friends and acquaintances to gather information. From alternative suppliers, production options, and even strategies they have set into motion at their own businesses, you will need all the information you can gather to create a successful strategy.
Keep up to date with news and use verified sources. Anything, from novel Coronavirus outbreak information to new economic measures taken by the government can completely change the strategy your business needs.
To escape the financial impact of the COVID-19 recession, analyze the vulnerable areas of your business and estimate potential damages. By defining your critical product or services and customers, prioritizing business functions becomes easier. Be ready to adjust business processes to sustain critical operations only. Furthermore, the best way to protect your business will be to recognize early on that you might need help. Professional experience brings ideas and strategies to the consideration table of critical decisions.
Numerous situations are coming ahead and things can become difficult or tricky. It will take some time for the economy to recover from this situation, but it will eventually pass. Nonetheless, focusing on solving a specific situation at the time allows decision making to be objective and efficient. Be confident in your workforce, keep them informed and try to make plans that steer your business to safer seas.
If you’re a millennial running a business and need resources, here are our top recommendations to set you up for success:
- Secure your business through worker’s comp insurance from Cerity
- Read about Why It Matters To Do What You Love
- How to Grow Your Business During A Pandemic