Cutting costs has become essential for so many people and small businesses since the COVID-19 pandemic has swept the world. According to Harvard Business School, small businesses can only survive for twenty-seven days with their current cash reserves. Creating positive cash flow and lowering expenses is a must in these times for people and small businesses alike to survive. In cutting expenses, small businesses have to be strategic in their moves to maintain their businesses still. To help with cutting expenses and being able to keep your business presence still, we’ve crafted a list of the top five ways for small businesses to survive a pandemic.
Bill moratorium has become a common term spoken about during these times. Certain lenders are allowing bills to be deferred to a later date to adjust to the rise of unemployment and a decline in the economy. If you’re a small business owner, then you should be looking into bill deferment. See if lenders or companies have payment plans in place to assist small business owners who need help or time with paying their bills. Consider checking with your landlord if you are struggling to make rent. Some landlords are more than willing to help tenants. Check with credit card issuers. Credit card issuers may be offering a program to help people make payments and maybe slashing interest rates. Utility companies as well are offering assistance.
A second way to remain stable and open during these difficult times is eliminating unneeded expenses. You will have to ask yourself what your business needs to run. What your business does not need may need to be eliminated. Business expenses common among small businesses like office space, storage, software and travel may need to be eliminated to some degree to sustain your business. Leased equipment like fleet vehicles could be one of the parts of your business you decide to eliminate. Capital improvement projects and business consulting could help your business to grow but are not essential. Choose to slash these from your budget during these times if the finances have gotten tight for you.
The third tip for a small business to survive COVID-19 is to cut payroll. Unfortunately, not all employers can employ their staff full time and pay regular salaries. If you can afford to continue to pay your staff as usual, then do so. However, if you must cut expenses, payroll tends to be a significant expense for small businesses. Try to offer a reduced pay. Work your employees part-time instead of full time. Remote work has become common. Remote work is safer during a pandemic. Plus, it will allow you to lower your operating expenses of utilities by having workers work in the same physical space. It may be necessary to look at benefits like insurance and pensions. These benefits may need to be cut.
Another tip for small business owners is to become a bargain shopper. Some of you business owners are probably already savvy shoppers. But for some of you, you may have to get used to shopping on a budget. Becoming a savvy shopper is not that challenging. Use coupons, join saving programs and eliminate overspending or mishandling your budget. Consider help from going to a local accountant to direct you on looking for cheaper options. Just because we are in a pandemic does not mean you must eliminate every cost or expense. Your business still needs specific resources to run. Just look for cheaper options for supplies, equipment, software and service providers.
Lastly, our fifth tip is to reconsider your marketing. Marketing is so essential for a business to drive new customers and keep revenue coming into the business. Look over your marketing budget. It may be necessary to start slashing cuts to your marketing budget. Some good ideas would be to partner with other business owners, double down on quality, affordable marketing, utilize public relations and make a priority of what marketing works well and saves money. These ideas can help you to market your business still while saving on your marketing budget.
Now that lockdown measures have lightened, many businesses have reopened their doors. If you’re thinking of reopening your business now, ensure that you have set appropriate health and safety measures for your employees, customers, and yourself.
Clean and disinfect your facility for reopening day, and continue your cleaning and disinfection routine to help prevent the spread of the virus in your establishment. Finally, develop COVID-19 safety protocols, provide safety training to your employees, and create an information drive for your customers.
Use this as a guide to lead you to be able to survive this pandemic. There are still ways small business owners can thrive in this pandemic. Adapt as necessary, and your small business will be able to prosper during these times.