Cash Flow? Small Business Recovery: Answers to your COVID-19 Business Questions
The biggest thing on my mind right now is Cash Flow. What can I do?
Yes, for most small businesses, cash flow is likely the single biggest problem they’re all dealing with. Although each business will have different ways to address this, and we’d need to look at each one uniquely, there are two primary considerations that are consistent for all: immediate cash flow and creating the future funnel.
IMMEDIATE CASH FLOW
Lean on your business experts for advice on how to run your business more efficiently and keep money in your business. Your attorney and accountant can assist you in making smart strategic business decisions.
With respect to marketing, it might sound silly, but do your clients know you’re open and providing services? If you haven’t communicated to them directly, on your website, and via social media, this is the first thing you need to do. It’s okay if your services are diminished or if your hours have been significantly truncated, just lay it out clearly and make it incredibly easy for them to do business with you in the ways that you are able.
Also, ask for help and for their patronage. There is no shame in asking, especially if it’s in the context of your desire to continue servicing the community. They should hear how you are keeping your staff and clients safe, and what measures you have taken to put health and safety as a top priority.
If your business hasn’t been open, think hard about your expertise and offering and how these things can be used differently. How you can provide value to the community. There are transportation companies that have pivoted from transporting people, to transporting food from farms to customers. Local restaurants are offering family catered meals and packaged recipe packs for easy cooking and assembly. Retail stores are providing free home delivery and safe door/curb pickup. Gyms and yoga studios have shifted entirely to an online class and one-on-one training model through Zoom.
Most of these operational shifts have allowed businesses to remain open and functional, while keeping employees and customers safe. And although many have had to reduce staff, they’ve at least been able to keep some employees on to keep the business running.
In some instances, business just may not be possible. In that case, what are the assets you have that could be temporarily used differently? Do I have a physical space another company can use for an essential service right now? There is an automatic trust factor that you won’t have to spend time building since you need to create income now. You can create a marketing program to promote this partnership.
CREATING THE FUTURE FUNNEL
While the things outlined above can help drive immediate albeit diminished cash flow, for the long term, you have to start thinking about the next 12 months and beyond. There’s no question the recovery will be slow. Very few businesses will be able to flip a switch and go back to the way things were last year. You have to begin planning now for how a more sustainable model can work for you and for the community. The businesses that do this are the ones likely to survive long term.
Take a serious look at the projections for your industry. Can it go back to normal? What are the long-lasting behavioral changes and how can you proactively prepare and adjust your business accordingly? Don’t think that the above short-term solutions are a temporary answer. Think of them as the first step to rethinking your business, how it functions, and how you can invest to get ahead of your competitors.
If you pivot to a more virtual/online experience, really scrutinize the way people go through that experience at each step. Make it easy, fast, seamless and secure. Spend the time NOW ensuring the experience is the best it can be. And if there are problems, don’t settle. Tweak and tweak again. These changes will likely mean investing in technological solutions that can optimize your new model, but it is necessary. A bad user experience is often the reason a customer who comes once but doesn’t come back.
Finally, the majority of small businesses don’t invest in marketing as a tool for growth. But that’s going to need to change. Marketing is an expense, but a necessary one. Especially now. If done well, it can allow you to find new customers, expand your market potential, keep your business top-of-mind over your competitors, and drive customer loyalty.
