Everything has changed in the last few days. Whether it is way of our living, tackling things and the way of our working and it is all because of the impact caused by COVID-19. If we say that this pandemic has stopped the whole world – we are not saying anything wrong. Many people in India are facing problems due to scarcity of food, water, shelter and above all income. You can buy anything if you are having income in our hands but thought for a second that what will happen if money will not remain in your hands? That is a big problem that our Indian economy is facing right now from the lower income group to the middle income group. Even tech giants like Apple felt the consequences of COVID-19 similarly as start-ups.
Small business owners/start-up owners are those persons which are directly affected by this pandemic and facing lot of financial difficulties in continuing their business operations.
Problems faced by Start-ups and other businesses
There are many problems which start-ups and other businesses are facing now days due to COVID-19 pandemic. Thousands of jobs have been lost, decline in the productivity, no communication with the vendors due to supply chain breakdown etc. Specifically in red zone areas - start-ups in association with third party firms facing delays and challenges in regulatory, legal and industrial operations, disruption in demand, low revenue generation, closing down of premises are the most common problems faced by start-ups. Hence, the only hope remained for the start-ups and small businesses are to practise digitalization. Most of the employees are working from their homes to cover up their work and save their salaries as it is difficult to communicate with clients face to face due to social distancing norms.
If you are having a small business or a start-up and it is affected by COVID-19, you must be thinking about the solution? Firstly, in order to deal with this situation, you need to create new set of rules in order to minimize the risk of insolvency as well as start making new plans in order to survive in this slowdown caused by the impact of COVID-19. We are providing you certain tips which will not only make you survive in this difficult time but also provide you solutions to cope up with the impact of COVID-19 –
Track your expenses & revenue and make future estimation
Firstly, make an estimate of your expenses and revenue. Make a list of fixed & variable expenses and analyse it against your revenue on monthly basis. This will not only depicts the financial health of your company but also influences you to plan for the coming future. In other words, it tells you where your company stands financially today. You can implement this strategy even after the end of this pandemic./p>
Check your business model feasibility
As you know that the market is changing every week, it is necessary for you to do the feasibility study of your business model in order to identify the actual position of your business. You need to understand the economic, financial and legal aspects of your business and try to evaluate the impact this pandemic caused on your new sales, collections, potential bad-debts and credit cycles.
Plan policies for next 3 months/9 months/18 months
We don’t know how much time this pandemic will take to come to an end. Therefore, it is necessary that we should plan our policies for next 3 months/9 months/18 months accordingly.
Make your strategy, remain in contact of your clients regularly, make your communication transparent with your investors and employees and act with compassion.
Be patient in securing investments
Every business runs with capital. Think once, what will happen, if capital will not remain in your hands? So, the question arises, if you are having less capital, from where will you get the capital for your business? We are having the solution for this.
If you are an entrepreneur and in problem due to the lack of funds, you may contact your existing investors for additional funding as they have already made investment and are in this arena from past times. You can easily take their help and give your business a strong boost in order to face future situations. However, it is possible that investors may take long time in taking the funding decision and pass funds after following the strict and a careful procedure.
Be transparent with your customers
Stay transparent with your customers and tell them about your real business position. In this pandemic situation, you can share your feelings with your customers and tell them that you are having full trust on them. Ask their perception about the products/services you offered them previously. Make your connection stronger with your client for near future.
Maintain a healthy relationship with your vendors/suppliers
Whether it is vendor, supplier or a landlord – everybody knows about the current situation. It is difficult for you to pay your vendor/supplier or landlord in this lockdown situation. Therefore, it is important that you must give them notice in advance, if there is going to be any delay in future payments so that they can prepare for it. It is important for you to maintain a healthy relationship with your client so that there will be no place for anger & disappointment in this difficult situation.
Managing your employees
Sometimes you need to take a tough call too. As long as large companies are concerned, primary option available in front of them is to cut down the salaries of their higher paid employees to retain them so that they will not lose their jobs in this tough situation - Same goes for Start-ups. Follow the government guidelines and offer additional compensation (if required). What you need to implement, do it once as implementation done in stages can affect the morale of your employees.
Team engagement is also necessary in this pandemic situation. Every development should be communicated to your team. It is your duty to keep our team of employees engaged and make a communication with them regularly through video conferencing technology such as Google hangouts, Zoom etc. Keep the spirits of your team high and engage with them in such a way that everybody does their work from home effectively and efficiently.
Communicate with your stakeholders
It’s your responsibility to communicate with your investors, customers and employees on regular basis and tell them how you are coping up with the situation and what impact COVID-19 has done on your business and your whole leadership team. Anything you want to tell (either positive or negative) will be communicated to the team with utmost empathy along with valid reasons.
It’s time to remain engaged, united and helpful in order to fight this difficult situation of COVID-19 pandemic. Stay inside, stay safe & stay healthy.
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