Running a small business these days is tough. There’s no easy way to deal with the challenges that come with running your own company. It is even made more challenging due to the pandemic and its effects on various industries worldwide.
The hard days are not letting up yet, and you have to play your cards right to stay afloat until the next few months or years. Some places are starting to open up the economy, but the threat is still there. It means that your small business needs well-planned and well-thought-of strategies to survive this crisis.
Here are eight crisis management strategies that should bring your small business across and beyond this pandemic:
Talk to your accountant
Your accountant is either your friend or enemy, depending on what kind of relationship you have with them. He knows the financial status of your business and will advise you accordingly.
There are extensions of filing taxes and payments due to the economic step-back. Consult with your accountant regarding this matter and adjust your estimated taxes. If you are looking for refunds, you can opt to file your taxes early. Likewise, learn more about tax credits if you are offering paid time off for your employees.
Claim money from your city
The first year that a business operates in any given location, it’s getting subsidized by the local government to help develop its infrastructure. If you are not aware of this, check with your local government if you qualify for it. They have programs that can help boost your business, especially during difficult times.
You can also explore city loan programs and set up plans for small businesses as part of the crisis management plan. It can help your business stay afloat and open until everything stabilizes.
Claim funding from your state
States have their version of the stimulus package. The purpose is to support small businesses in dire need of capital infusion to get back on their feet. It may include funding for marketing, research, developments, expansion programs, and productivity investments.
Check if your state has a program that can help you overcome this crisis promptly. Every state provides counseling, advice, and information to everyone who needs help during these tough situations. Go to your state’s website to know what is available for you to explore.
Apply for a loan
You know the motto: when all else fails, apply for a loan. Yes, it’s the “nuclear option” of crisis management strategies. But if worst comes to worst, you have to swallow the bitter pill and pursue a loan from your bank.
Some banks offer loans with reasonable terms and conditions as part of their recovery packages for small businesses during tough times. They also have a collateral loan program wherein you can use your assets as indemnity against debts you owe them. Study the offers and compare them before you apply for a loan that suits your needs.
Educate your employees
Sometimes, the best crisis management strategy is the people you work with. You can never underestimate their importance to your business. They keep business running through thick and thin, so it’s only natural that they play an integral role in keeping the company afloat during this time of need.
One way to keep your employees motivated during these times is to give them a thorough orientation about the company and its current financial status. It is an excellent way to build trust and transparency among everyone involved. You can also include them in some form of reward for their hard work through this trying time, such as performances of appreciation or giving away bonuses.
Push your bankers
Be smart when talking to the people you work with. You don’t want them to think that your business is losing money, so build a good rapport with them even if you are currently in default. When things go back to normal, they can still help you get back on track or maybe even offer new terms for debts paid in full.
Some banks offer loans and lines of credit to small businesses in crisis. If you already have a relationship with your banker, it would be best to take the opportunity and ask for support when needed.
Push your big vendors
Prominent vendors can do more than give discounts or waive late fees. You can also ask them to convert invoices into electronic payments, which you can use as a payment plan for your business. This way, you have a set schedule of when you should pay up while they wait for their payments in return.
It is also effective in terms of negotiation because it takes away the power from your vendors since they already know that you have an alternative payment plan.
Use downtime wisely
Downtime is a good thing for every business. It’s the perfect opportunity to conduct a thorough evaluation of your operations and your employees. You can use this time to build better relationships with them, perhaps by involving them in decision-making processes.
With this downtime, you can also focus on strengthening your business’s internal processes. Look for ways to cut costs and improve revenue by using your resources more efficiently. By the time you resume the entire operation, you will not only be back in shape but better than ever.
Crisis management strategies are hard to come by, but there are still many ways to help your small business recover from financial loss. Consider each crisis to be a short-term event. It will end soon, and the economic snap-back will bring vigor to businesses once again. In the meantime, make do with what you have and survive. Don’t hesitate to reach out to partners and stakeholders for support. Small businesses need all the help they can get right now, and there’s no shame in asking for it.
It’s never too late for survival because as long as you have the right mindset and can make good use of what you have, it’s only a matter of time before you grow exponentially.