It has been a nail-biter. Small businesses have been through so much uncertainty and change in the last few months it’s a wonder they still have their fingers intact. Here at the Small Business Development Center, we have a lot of adjustment, too. I am writing from my home office and trying to keep my kids from destroying the kitchen.
I am proud of the incredible adaptations in our homes and workplaces. The flexibility and tenacity our local businesses have shown is heartening. Many of our Small Business Development Center clients have secured financial support, changed operating procedures, added e-commerce, secured personal protective equipment and are doing well. I was at my hairdresser (also a client) today, and she is booked through August. Although it was stressful to go through temporary closure, Stacie Campbell of Cuts and Color by Stacie is “as busy as she has ever been.”
Of course, rebounding depends a lot on the type of business. Hair salons, grocery stores and gas stations have an easier rebound than those in the entertainment, travel and luxury sectors. However, there are still many options for those COVID has hit hardest. Having a relationship with your Small Business Development Center is one of the steps you can take to help navigate these changing times.
Although each business will have different needs, I recommend all businesses work through the following rebound analysis: cash flow, expense reduction and marketing shifts.
Cash flow: In order to work with this most important part of your business, you need to have organized financial statements. The SBDC can help you put these together if you don’t already generate them on a regular basis. You need to know how much you spend and earn each month, so you understand your break-even point. This is how much you have to sell in order to cover your expenses. Once we understand the break-even point, it is a foundation for sales goal setting. The SBDC recommends breaking down your monthly goals into weekly and daily goals and actions. For example, if you need to sell 20 subscriptions a week and you typically get two every time you post a social media special, posting once a day would be one of your daily goals.
Expense reduction: This is a challenge for many businesses, but it can be easier with input. This is a chance to ask your employees and partners where they see potential savings. Your vendors may be able to help with extending payment terms, and your landlord and utilities may be able to do the same. It is important to approach a payment reduction requests with compassion. It is likely your vendors are suffering, too. Bringing a specific proposal including a time frame for the new agreement will help. Even competitors can help. For example, if neither of you have enough business for a minimum order of a particular supply, you could go in on an order together. Meeting with your accountant is an important step too, as there may be opportunities to defer some of your tax payments.
Marketing shifts: Now is an excellent time to revisit your digital marketing efforts. Make sure any new hours or changes in operations are noted on all of your online venues. Many successful businesses take the time to tell their customers how they are keeping employees and clients safe. Look at your website. Is all the information up to date such as menus, inventory, delivery, curbside service, etc.? Is it clear how to reach your team? Perhaps this is a good opportunity to add ecommerce to your site. Online ordering might be a great move. As audience behavior changes, your marketing needs to change with it. The SBDC can help you think through these COVID challenges.
Ann Swanson is the regional director of the Small Business Development Center at the Idaho State University College of Business. The SBDC is taxpayer funded to provide no cost consulting and low-cost training to any small business.