While the short-term outlook for business varies a lot by brand and industry, it’s important to look at what your recovery model might look like once we reach a state of normalcy with the economy again. Having a strategy in place will help you be prepared to start a rebuild and you will rebound much faster! Here are some ways you can get back on track faster:
Assess the Financial Damage
Step number one is digging into the numbers to determine how deeply your small business has been affected by COVID-19. It is important to start by making sure your financial statements (profit and loss) are up to date prior to evaluating the hard numbers. You can compare this year’s numbers to last year’s numbers to see how much your business is down.
In addition to looking at the numbers, it is important to assess other ways in which your business has been affected. For example, if you had to lay off employees, you will need to take that into consideration when thinking about your rebuilding plan. If you have cut marketing spend or have lost some customers to competitors, you must also think about this when identifying financial resources to help you recover.
Take a Look at Your Business Plan
Your business plan and model may have been working great prior to COVID-19, but with so many changes happening, you may need to make some updates when considering adjusting to the new normal. If you are a bricks and mortar company, you may want to look at digital expansion to accommodate people who will be shopping online from home.
It is important that you get clear on your businesses strengths and weaknesses. Look at what was working before but may not work now and figure out a solution. We also recommend reviewing your business goals and revenue targets to make sure they are still realistic.
Unless you had a large amount of cash on hand prior to COVID-19, you may need some funding to help kick-start your business operations. There are several options to look into for businesses right now.
Revamp Your Budget to Account for New Spending
It is important to realize that coming out of COVID-19, you may need to make some investments in your business to get ahead again. You may need to spend money on hiring or training new employees, or even re-training the ones you laid off. You may need to increase your marketing budget to re-build the brand and create awareness in the market.
As a part of your recovery from COVID-19, you should have a clear idea of what you need to budget for and where you can make cuts to optimize revenue coming in. The goal is to get your operating budget as lean as possible and to invest in areas of potential growth.
Develop a Time Line
There may be a ton of ideas in your head around things that you need or want to do post COVID-19, but doing it all at once my not be realistic. We recommend creating a timeline to prioritize the most important items first. We also recommend tracking your progress. This will help you focus on the right activities to move your business forward. Evaluate your business on a weekly bases and review your business financials often to make sure you are on track.
Create a Plan Incase of Another Crisis
Although COVID-19 may be a once in a lifetime event, it is important to now be aware that crisis can happen and be prepared for the possibility of it. Focusing on building liquid cash and cutting operating costs are a good place to start. The more out of the box thinking you can do to prepare for the worst, the better. Having back up plans will improve your odds of surviving and help your business get back to thriving much faster.