From November through to January we witnessed devastating fires. The regional small business sector has already taken a big hit (the extent of which is still yet to be seen) and yet we still must prepare ourselves for the economic fallout of the Coronavirus.
What can we do as business owners to navigate through this?
The take-home message is to be pro-active. Businesses already have a heightened awareness and the sure-fire way to control this is to plan, particularly around cash flow.
Follow these proactive initiatives.
Identify the trigger points in your business which may highlight a potential downturn. What are these and what decisions must be made at each point as the Coronavirus impacts the business? Once the pandemic passes, what is your plan to recovery?
Examples of trigger points are…
Two useful links
Remember tough times don’t last, tough people do.
Thanks for reading
Stuart “pro-active” Goodfellow
Here are the answers to a few questions I have received. If you have a question, email me at [email protected] and get your question answered here.
I Hi Regional, I am tempted to send some of my staff home to work remotely? Will my Public Liability cover them if they have an accident at home?
Here’s the disclaimer… call your insurance agent.
Look, your agent will probably err of the side of caution, but if your team member is working from home then goes to hang out the washing in their pj’s and crocs and trips over the dog, it’s unlikely to be a workplace injury. However, if they fall off their home office chair or the computer drops on their head, they are may be covered.
Ask your insurance agent to investigate it and give you a written/emailed ruling and guidelines for your team. Then have your team member to sign off what is acceptable or unacceptable.
Hi Regional, I don’t sell toilet paper, rice or pasta, but if I did, I would be ordering up big-time. I run a café and wonder if I should be ordering more cups, coffee beans, and forward ordering food in case my supplier runs out, or should I just wait and keep more cash in the bank in case I need it for overheads like my rent and wages?
Have a look around you. How as the lunch time traffic today? If you work in the city and the buildings are emptying out, it doesn’t matter how much coffee you have, the demand will be low. However, if your business operates where there are many separated businesses, such as an industrial area, you could be somewhat protected from the effects of broadscale business shutdown.
The key is to talk with your best customers and key suppliers. They will give you the hint as to short supply or demand and you can act accordingly. Your customers want to know that business is normal, and you will be there for them. Your suppliers also want to know that you will continue to buy from them. Keep up the chatter and you will sail through this.
Regional, I am looking at introducing a new product range. I know the market needs it as there are others in this market, but it will come at significant initial start-up cost. Should I take advantage of it or wait until things settle?
Hey I’m all for taking a chance but as long as it is informed, and you have the rigour to support it. We know that the deal of a lifetime comes along every day, we simply fail to recognise it or act on it.
The fear is ‘what if it doesn’t work?’ To reduce the coin-toss decision, make sure you do your homework.
Is there room for another player in the marketplace right now? Do you competitors have manufacturing, supply of delivery issues that you can capitalise on? What is your point of difference once the market returns to normal? How long will it take for you to launch and what will it cost to breakeven? Is the cash you have available to invest in this new product needed for cash flow of your existing core business?
If the time, the cash and the details are sound then it makes sense to light the fuse, otherwise it may be prudent to keep your powder dry and be ready to jump in then.
Good luck, Stuart