7 tips for keeping your business going during the coronavirus downturn - CNBC

7 tips for keeping your business going during the coronavirus downturn - CNBC


7 tips for keeping your business going during the coronavirus downturn - CNBC

Posted: 26 Mar 2020 01:11 AM PDT

The rapidly escalating coronavirus outbreak is hitting businesses hard, with many being forced to scale back, or shutter entirely, in a bid to stifle the spread.

On March 23, 40% more U.S. businesses were closed compared to the same date in January, according to real-time analytics from scheduling site Homebase

And business owners are not hopeful. More than three-quarters (76%) of small businesses say they are being negatively impacted by the public health crisis — up from 23% just 10 days ago — according to a new report from the National Federation of Independent Business (NFIB) released Monday.

But as businesses await more clarity on how long the mass lockdowns will last, and what local and national governments will do to support them, there are a number of things businesses can do now to ready themselves for reopening, according to risk management expert Nicholas Bahr.

Bahr, global practice leader in risk management at consultancy DuPont Sustainable Solutions, has spent 35 years helping businesses navigate geopolitical, climate and terror risks, including 9/11, and said "now is the time to turn risk into an opportunity." He outlined seven steps for doing so. 

7 steps for businesses:

  1. Care for your people — Establish "robust and frequent" communications with employees to understand how they are being personally impacted by the virus and provide reassurances where possible about how you plan to support them.
  2. Build a governance system — Create a governance system for decision-making, focusing on data rather than emotions. That may comprise three levels: The immediate, namely people and the day-to-day business; the medium-term, such as cash conservation and potential lay-offs; and the long-term, like the possibility of major economic impact.
  3. Run risk assessments — Even if you have an existing risk assessment, it may no longer be suitable. Set up a new one focusing on the hygiene and safety measures needed to safeguard humans, finances, technology and operations during the outbreak.
  4. Push external communications — "During a crisis, your biggest commodity is trust," notes Bahr. Take time to reassure all customers, stakeholders and the general public that you are taking appropriate measures to fight the outbreak — and even contributing to a resolution. Social media can be a great platform for this, as well as a means of sourcing ideas from customers. 
  5. Assess supply chains — Figure out whether your customers are still customers and what they now require from you. Then speak to suppliers about what they can offer you, being wary that they may over-promise. If cash is tight, remember that not everything has to be done in cash: Get creative and think about how you can barter with other products and services. 
  6. Review operational risks — Assess all operational aspects of your business, such as kitchens or factories, and create a pre-start checklist to ensure you're ready to go as soon as the socioeconomic landscape permits. 
  7. Use downtime productively — Make the most of any spare time to think about developing any new services and procedures you haven't previously had time for. Galvanize your staff and help them to feel productive and valued by involving them in this process.

Bahr's recommendations mirror those of other management specialists. Jordan Strauss said business owners should spend some time each day looking for new opportunities. Meanwhile Greg Milano, CEO of corporate strategy consultancy Fortuna Advisors, said the recovery strategy could be broken down into three key steps: Survive, improve, and seize opportunity.

Businesses first need to deal with cash flow and liquidity issues, considering how to potentially repurpose to keep those in check, said Milano. The next step is to think about possible areas for improvement, such as modernization of technology. Lastly, for those less impacted, now could be the time to take advantage of new business opportunities, he noted.

A new business environment

Though Bahr's advice is designed to help in the immediate aftermath of a crisis, he said it could also help business owners navigate what is set to be a new landscape once the outbreak passes. 

That shift will likely play out in four ways, he said. Firstly, more businesses will begin to operate remotely, as working from home becomes more viable. That will be enabled by Bahr's second point, a rapid ramping up of technology. Thirdly, globalization will need to be rethought to make supply chains more robust to global shocks. And, finally, businesses will need to become more robust generally, focusing on long-term planning.

While the near-term outlook for businesses continues to look uncertain, with Bahr likening it to a dark tunnel, he struck an optimistic final note: "What's important for us to remember is that we will get out of the tunnel, we will."

Don't miss: Majority of business leaders expect a hit from coronavirus, survey finds. Here's how they're fighting it

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Support and Resilience: Bright Light for Small Kentucky Businesses - UKNow

Posted: 26 Mar 2020 01:00 AM PDT

LEXINGTON, Ky. (March 26, 2020) — Katie Startzman, owner of Native Bagel Company in Berea, is going to ride out the upheaval brought on by the COVID-19 pandemic and come out stronger on the other side. She's sure of it, because of the strength and support she is receiving from her peers, customers and local resources. Mae Suramek feels the same way, as she puts in the long hours to save her Berea restaurant, Noodle Nirvana.

In the past, when local economies have suffered severe blows, it often originated in industry and then trickled down to the service sector. This time the crisis immediately hit small businesses that provide services or retail goods. Many don't offer paid leave, and many have been forced to lay off employees.

"We were all in shell shock, and it was sheer beauty how we turned to one another during this time," said Suramek. She and Startzman have had to depend on local resources and come up with innovative ideas to keep their young businesses afloat. Recognizing that there is power in numbers, both women are turning to fellow restaurant owners through Facebook and business groups to share support and ideas. Suramek started a Facebook group for local restaurateurs when the crisis hit.

"It's a tough time, but in these small communities, particularly those that were making strides toward progress, they're actually pretty well positioned to respond. They're acting as a community. They're communicating regularly," said Alison Davis, executive director of the Community and Economic Development Initiative of Kentucky (CEDIK). "It's been really kind of awe-inspiring to watch the response at the local level."

CEDIK and the Kentucky Small Business Development Center, both housed in the University of Kentucky College of Agriculture, Food and Environment, are two places to which small-business owners in the state can turn.

CEDIK and KSBDC quickly ramped up their emergency efforts. Using social media and their websites, both groups are pushing out large amounts of important information about available loans and other resources and advice for business owners impacted by Kentucky's efforts to flatten the coronavirus infection curve. 

CEDIK has a number of programs already in place that could prove helpful to small businesses as well as employees. Its Create Bridges program, currently in 13 counties in Eastern Kentucky, is designed for business and workers within the retail, entertainment, tourism, accommodation and restaurant industries. A proactive program, it is designed to help workers plan a career trajectory to be able to rise above entry-level wages. In addition, there's a business support side for companies trying to identify the types of resources, infrastructure and marketing needed to keep their doors open or to grow.

"We're going to take pieces of that and go statewide with as much as we can. It could not be more timely, because this is the exact sector that is getting hit hardest," Davis said.

CEDIK's Business Retention and Expansion program is also set up to help businesses stay on their feet. The national program is a community-based initiative that helps communities determine the strengths and weaknesses of their business climate. Davis said they are working to modify the program to respond to the coronavirus crisis.

The Kentucky Small Business Development Center offers services directly to small-business clients and entrepreneurs.

"Serving small-business owners is our primary mission, and in addition to the Small Business Administration, we have a national America's Small Business Development Center network to call upon for resources as we work to respond to both the routine and crisis needs of small-business owners," said Kristina Joyce, KSBDC state director.

To maintain the proper social distance, KSBDC local offices are using technology to reach small-business owners and help them not only weather this storm, but also plan for a secure tomorrow.

The organization has launched a new website to provide up-to-date information throughout the crisis and beyond. The site, http://kybizhelp.com, will be updated as new small business information and resources become available. KSBDC has also created a small business hotline: 1-888-475-SBDC (7232) to efficiently route callers to a KSBDC business coach in their region. A weekly Wednesday afternoon webinar series also is being launched. Information for that will be included on all KSBDC social media and web sites.

"This is unprecedented, but we're trying to 'Keep Calm and Small Business On,'" Joyce said. "I know it's very disconcerting, especially when you're required to shut down. Sometimes in these conditions of crisis, new innovation comes about because of it. This is the time to assess where you are, reach out to your vendors, bankers and customers and do some business planning for when the crisis is over. We will get through this together."

Both Startzman and Suramek were aware a few weeks ago that times were about to change for them. Suramek's plan was to stay one to two steps ahead of the game. Early on, she and her Noodle Nirvana staff developed a three-page internal COVID-19 policy that detailed an especially stringent set of disinfecting and sanitary guidelines. They began using the internet to have weekly Zoom meetings, during which they considered how to handle things if the governor shut down restaurants or if Kentucky became a shelter-in-place state.

"I honestly didn't sleep at all in my efforts to come up with every possible scenario and have a corresponding action plan that included schedules, system changes, building technology to support those changes and ensuring that my staff would continue to be paid," she said.

Out of those meetings came "Beyond Noodles," a weekly meal delivery plan from which people could select one-to-six meals to be delivered directly to their home. They sold 120 Beyond Noodles meals during the first week.

Over at Native Bagel Company, Startzman decided to sell bagels in bulk using curbside pickup. Their first curbside event was on March 21. They sold out within hours.

"Our community was amazing and really showed up," she said. "That human connection is what's getting me through emotionally and also literally, so I'm very grateful."

The Small Business Administration has updated its Disaster Declaration website to include all counties in Kentucky. That means business owners could be eligible for economic injury disaster loans. Joyce, a small-business owner herself, also recommends calling the bank and asking for a loan extension or a bridge loan. Startzman spent a recent morning talking to her accountant and her local banker. By lunch, she was breathing easier.

"Basically, we didn't have the cash reserves to weather more than a month of this. We're going to be getting a bridge loan that will cover our monthly expenses, and then we'll see where we are when the dust settles," she said.

All four women are positive that people will emerge from that "dust" stronger and more resilient than ever.

"These rural communities are close knit. We're going to see higher rates of poverty for a while. We're going to see unemployment go up. But I have high expectations that we're going to recover," Davis said. "I think it will be a great lesson moving forward, and it will just make us stronger in the long run."

Information on available resources to small-business owners is available on the following internet and social media sites:

https://cedik.ca.uky.edu/COVID-19_resources

http://kybizhelp.com

https://www.facebook.com/ksbdc/

https://www.linkedin.com/company/kentucky-small-business-development-center/

https://twitter.com/kysbdc

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