The COVID-19 outbreak, followed by social distancing and lockdown, has hit the businesses severely, no matter how established they are. Witnessing the current situation and unforeseen future, businesses are forced to re-look at the ways they operate.
It has become a challenge for the companies to keep their financial wheel working in the lockdown period due to fewer sales, resulting in negligible profits and uncertainty in the global economy.
Unfortunately, the impact of lockdown has been way more brutal on startups and small businesses than the established and big labels. According to reports, India’s financial year (FY) 20-21 is expected to come down to 2% from 4-5%.
Therefore, in such testing times, startups, small businesses and other companies need to re-evaluate their business model as well as be mindful of expenses.
So, here are four effective strategies to keep the business running smoothly during the lockdown as a result of COVID-19.
1.Tracking Expenses Against Revenue: During this time, it’s of utmost importance for the businesses, whether big or small, to track their fixed and variable expenses as well as their revenues. The tracking and analysis will give them the real picture of the financial position they are currently facing. Based on their financial standing, businesses should plan their future operations. Even after the pandemic settles, it should be a regular activity.
2.Check The Feasibility of Business Model: As the market is changing every week, it is important for companies to reassess their business models and to recheck, reconsider their position in terms of revenue and cost. Take into consideration the current financial situation and cash flow. Evaluate sales, credits, collections, etc. If required, make alterations as per the nature of your business. Like, if your business deals in Rakhi, you could start providing rakhi online facilities and vouchers because a takeaway is no more a feasible option and a redeemable voucher scheme would benefit both, the company and customer.
3.Plan Future Business Policies: It’s difficult to guess how long the pandemic will last and after how many months life will come to normal. Also, with so much happening around the world, geographically, economically, and socially, businesses need to formulate policies for the next few months or say a year. You may need to revise your sales strategies, selling premium rakhi online as compared to offline sales. You may also be required to cut down and negotiate expenses. Re-evaluate your terms and conditions with investors and employees. Take into consideration all the possibilities. Strategize and communicate effectively, transparently.
4.Patiently Secure Investments: Every business needs capital to run. The question of where we will get our capital or funds crosses the mind of every businessman, founder, entrepreneur, especially during these hard times. Approach the existing investors for funds as you have a rapport of trust, they are more likely to help you out. If you are going for new investors, be patient.
Conclusion: Adopting online business models, staying connected and social with potential investors, customers, and revamping the business process as per the changing scenarios are some of the best ways to ensure the survival of the businesses.
Be positive and productive. Like all difficult times, this too shall pass.