With the COVID-19 pandemic, it’s as important as ever for you to be pandemic ready to survive the storm to protect your business. Here are some tips.
The business world is changing with the COVID-19 pandemic. As social distancing and stay-at-home guidelines became widespread, businesses of all types had to adjust hours, lay off or furlough employees or, in some cases, close completely.
For small businesses in particular, these changes can be devastating. There is, however, still hope. A proactive strategy can help business owners weather the storm until society and the economy can return to normal. And thinking through their strategies for mitigating disaster can also set businesses up for long-term resilience, whatever the future may bring.
Consider the following scenarios to guide your business’s pandemic-planning:
Put Employees First
If your business structure has shifted, you can still guide your employees through making the best out of a scary and confusing situation. For example, if your employees can do their jobs from home, now is the time to allow—or encourage—them to do so, in line with local guidelines.
Maintaining some semblance of normalcy during the upheaval can also help employees stay focused and meet deadlines. There are plenty of technologies available, including video conferencing, that will allow for immediate communication while you’re unable to meet in person.
It’s also important to remember that many parents are now trying to work while their kids are home full-time. Allowing employees to take blocks of time throughout the day just to care for their kids is a nice way to go the extra distance during this time. In fact, studies show that employees who feel their voice is heard at work are nearly five times more likely to feel empowered to perform their best work.
Laying off or furloughing employees is always a worst-case option for business owners. Your employees are likely already concerned about that possibility. Maintain transparency and continuous lines of communication in order to update them on your business plans for the future.
Get a Handle On Your Finances
Depending on your business model, money could be tight right now. Businesses are losing customers since everyone is staying home, and a new study found that 52 percent of Americans are cutting spending due to concerns about the economy.
If you’re feeling the pinch, consider calling your lenders and financial institutions to see what they might be offering to help during this time. Some are waiving fees or interest for a certain amount of time, and some landlords are even skipping rent payments for a month.
Hold On to Your Liquid Assets
Now may be the time to use the lines of credit you have available. Most businesses are diligent about paying their credit card balances on time, and during this time you may even be able to get a waiver on interest. So now is a good time to save your cash assets and instead charge what’s necessary to keep your business running. Putting expenses on a credit card for the time being gives you an extra cushion in terms of when payment will be due, in the hopes that by the time that happens things might be back up and running.
Understand What the Government is Doing to Help
You aren’t alone in your struggle right now, and the government is trying to lend a hand. If you’re a business owner, it’s important to keep up-to-date on what’s being offered by way of programs and relief packages.
Although news changes daily, some of the current programs include:
- Low-interest loans guaranteed by the SBA: The Economic Injury Disaster Loans offered by the Small Business Administration offer up to $2 million in assistance that can be used to pay fixed debts, payroll, accounts payable and other bills. Click here to learn more about eligibility.
- Employer tax credits: Since employers are now required to provide paid sick leave to eligible impacted employees for up to 80 hours (about 10 days), new legislation is also offering small and midsize businesses a business tax credit equal to 100% reimbursement for paid leave. Health insurance is included in the credit, and employers face no payroll tax liability.
- Stimulus payout: The government’s assistance package includes a stimulus check for most individuals, which can also help some small business owners who have lost income due to the current economic climate. What you will receive depends on your income, but single adults who filed an adjusted gross income of $75,000 or less for 2019 (or 2018, if you haven’t filed in 2019 yet) will receive $1,200, and qualifying children who are 16 and under receive an additional $500 each.
- Tax deferments: The IRS has extended both the filing deadline and federal tax payments deadline—without penalties and interest—to July 15, regardless of the amount owed.
There is no doubt that this is an unprecedented time of confusion and worry. For small business owners who are worried about themselves, their families and their businesses, the above programs and strategies may be able to provide some relief until we collectively get back up on our feet.