As the coronavirus outbreak continues in the U.S., bringing on troubled economic times and periods of social distancing, it can be difficult to see the light at the end of the tunnel. But when conditions improve, you’ll want to have ensured that your business has stood the test and is ready to thrive. Here are 10 top steps you can take to help mitigate the coronavirus economic impact on your small business.
1. Ensure a Safe Environment
Make sure your storefront and office space have been thoroughly cleaned and are continually cleaned as needed. The Centers for Disease Control and Prevention (CDC) has published standards for cleaning you can reference. Ensure you have the supplies you need to disinfect surfaces. If you hire a cleaning service, make sure they’re able to keep up with an increase in sanitation, if needed.
Additionally, if you run an essential business, help safeguard your workers by providing protective gear. You should also post the CDC’s instructions for hand washing in the bathrooms and make hand sanitizers readily available.
Keep in mind, essential businesses include, among others:
- Convenience stores
- Gas stations
- Grocery stores
- Hardware stores
- Health-care facilities
- Shipping businesses
- Trash collectors
- Veterinary clinics
2. Understand Your Business Insurance Policy
It’s important you understand what is and isn’t covered by your insurance policies. While many policies have business disruption insurance, this typically only applies to interruptions your business has experienced due to a physical loss stemming from a covered cause, such as a fire. However, you can contact your insurance carrier for more details on the specifics of what your coverage entails regarding the coronavirus.
3. Diversify Your Supply Chain
While you might have worked with the same suppliers for years and have established relationships in the business, it’s important to have a backup plan with alternate suppliers, should the need arise. According to a recent survey conducted by the National Federation of Independent Businesses (NFIB), 39% of businesses that have been negatively impacted by the coronavirus are having supply chain disruptions, but only 3% have modified their supply chain thus far. Stay ahead of this by reaching out to other outlets as a backup and ensure you maintain a steady stream of the supplies you need to keep business running.
The Small Business Administration (SBA) has access to partner resources that can help. Their district offices also have trained experts who can provide assistance so you can learn how to adequately respond to changes in demand.
4. Pursue Ways to Broaden Your Business
These times of strain can be the precise moment to innovate and test the waters of new opportunities you might have only been contemplating before. If business has slowed, consider how you can pivot.
For example, Harvard Business Review (HBR) reported that in an effort to increase awareness and customer loyalty, the Chinese financial technology company Ant Financial, engaged in insurance sales, decided to include coronavirus coverage for its health insurance products free of charge. This action was projected to yield a 30% increase in health insurance income over the previous month.
5. Consider Expanding to Online or Teleservices
Pivoting doesn’t just refer to business service offerings, it can mean switching the way you extend your services. If you’ve run your business out of a brick-and-mortar location, consider selling your wares online. You could also offer special promotions for e-purchases, and dedicate your time to promoting your brand on the web.
Amid the coronavirus outbreak in China, a cosmetics company did just that, according to HBR. When 40% of Lin Qingxuan’s stores were forced to shut down, the company shifted its focus to digital platforms, employing more than 100 of its beauty advisers to promote the brand. By engaging customers online, they not only saw a significant boost in online sales, but were able to realize a 200% increase compared to the previous year’s sales.
Another avenue some business owners are taking, particularly in the health-care field, is to offer teleservices, such as teletherapy and telemedicine. In times when people can’t leave their homes, offering much-needed services through video conferencing or phone calls can be a significant help to your business and the community.
6. Keep Abreast of Industry Changes
Stay in the know by maintaining open lines of communication with your suppliers, vendors and partners. Monitor what local officials are saying and understand how your community—as well as the country as a whole—is being impacted by the effects of the coronavirus.
For instance, the Families First Coronavirus Response Act, which President Trump recently signed into law, impacts many small businesses and employees throughout the country. Among other provisions, employers with fewer than 500 employees will be required to provide paid sick, family and medical leave to workers affected by the coronavirus. The government has indicated that such employers will be given tax credits to offset the cost. Companies with fewer than 50 employees can seek an exemption from offering paid sick leave if the cost will impose a hardship on the business.
7. Attend to Overlooked Areas of Your Business
Billionaire businessman Mark Cuban recently offered some sage advice to small business owners via LinkedIn. He suggested that owners take stock of the aspects of their business that have been neglected—think about bookkeeping, competitive analysis and market research. Determine what that means for your company.
Cuban also suggested reaching out to potential customers you’ve been meaning to connect with, whether through phone calls, social channels or email.
8. Ensure You Have Access to Capital
As a business owner, you’ve likely had your share of challenges. Financial challenges, however, can make it difficult to manage everyday needs, such as payroll, rent and inventory, and cash flow.
The Federal Reserve recently announced it would drop interest rates to zero, an act not seen since the financial crisis in 2008. It will also loan more funds to banks to open up lending to small businesses and individuals, to the tune of $1.5 trillion in short-term funding.
Ensure you have access to the capital you need now. A business line of credit, for instance, offers a flexible funding solution that is there when you need it. Additionally, consider how a business loan can help. The SBA, for example, will offer disaster loans of up to $2 million to small businesses in approved states.
9. Communicate with Customers and Employees
As you’ve likely seen in your own inboxes and social media pages, companies are sending messages to their patrons and the public about how they’re responding to the coronavirus and the inevitable changes it brings. Do the same with your customers. Consider sending an email making clients aware of what you’re doing to prevent the spread of the virus and how your business will operate in the meantime.
Also be sure to communicate with your employees. If you’ve transitioned your staff to remote work, check in periodically via video conferencing apps or chat. Be available to answer questions they may have and provide clear direction about what’s needed from them.
10. Plan for the Immediate Future
Develop a plan for your business, analyzing how economic changes will impact your company. Decide what you will do when conditions improve and how you will respond if conditions worsen. Consider developing a conservative plan in which you’ll lay out how to conduct business and manage operations through the end of the fourth quarter. But also be sure to plan on the optimistic side too, completing a contingency plan taking you to the end of the second quarter.
Implementing These Tips to Help Your Business
As a business owner, you’re likely no stranger to overcoming difficulties and hardships. Take the lessons you’ve learned in your own past and the tips we’ve offered to face this new challenge head-on. As American poet Robert Frost wrote, “the best way out is always through.”