Small and medium businesses enterprises (SMEs) are suffering loss of revenue and trying to weather the Covid-19 pandemic. This is a huge financial blow that will be worse than 2007/08 global recession. Many SMEs have, or will close down and not come ...
Small and medium businesses enterprises (SMEs) are suffering loss of revenue and trying to weather the Covid-19 pandemic. This is a huge financial blow that will be worse than 2007/08 global recession. Many SMEs have, or will close down and not come back after the pandemic. Cashflow is the bloodline of any business; many SMEs have an average of 30 days as a cash reserve. Public health experts and researchers advice Covid-19 outbreak to subside for at least eight weeks, assuming that social distancing and other WHO and government mitigation efforts can slow the spread.
If businesses can stay solvent, then we have a greater chance for a recovery after the virus threat subsides, but most vulnerable businesses will not last the 30 days period. They will require interest-free loans and other cash buffers to pay their workers, rents and other statutory bills while they consumers to resume some of their spending habits. There is no easy answer but here are a few points to start implementing and planningat least for the next four months.
RENEGOTIATE CONTRACTS AND DEBT TERMS:
Approach your debtors for review customised outstanding debts agreement terms, ask your landlords for more time to pay rent, request large companies and government agencies to pay outstanding contracts or advance payment to finish the contracts.
TAX PAYMENTS
Request the revenue authority for taxes filing extension and file on time to avoid penalties, the penalties can be source of your capital.
UP-SKILL YOUR STAFF
Equip them with additional skills such as virtual working, which could make them more productive and efficient, at this time and in future. There are plenty of online courses that are affordable, and these will allow them to focus on other areas of the business when their department is down. Establish Covid-19 policies Be clear with your employees regarding your specific policies within the business and safety protocol.
IMPLEMENT A WORK-FROM-HOME AGREEMENT IN WRITING WITH YOUR EMPLOYEES AND HAVE THEM SIGN IT
Set forth expectations and implement a procedure for a weekly productivity report. Symptomatic employees should stay home and self-isolate. If you are able, allow your employees to work remotely, conduct business meetings in Zoom or via Skype, and embrace people’s choices regarding their own health.
FIND THE OPPORTUNITIES
Covid-19 is wake-up call to reconsider how you have been doing business. How do you expect your customers to behave moving forward? What will and won’t matter to them, and how can you accommodate who will likely be a new type of customer?
DON’T PANIC, KEEP CALM
This can be difficult especially when cash is running out, but remember to take care of yourself in a way that works for you. For instance, eat well, and try to get some exercise in.
MAINTAIN MARKETING EFFORTS
Make sure to communicate clearly and consistently with your clients. If you are open for business, make sure they know that and how to interact with your company.
DEVELOP AN EMERGENCY PLAN
No matter what the emergency, your business needs a plan. For the Covid-19 outbreak, create contingency plans for what will happen to you or your employees become ill and you cannot receive supplies because of closed borders.
Over 70 per cent of our GDPs are controlled by SMEs which are the fabric of our economy. If we lose these businesses, our economy and society are going to look very different when all is said and done, and it will take a long time to bring back the businesses we will have lost.
Lastly, serve and help those in need in your community.
Original Source: Business Daily
