The challenges for small businesses as a result of Covid-19 are huge. The exact impact will depend on your sector with some being worse hit than others. However, in most cases new business will have dropped considerably and for some companies it will have fallen off a cliff altogether.
Small businesses are having even more difficultly than usual getting their old outstanding invoices paid. Some large companies have come under fire for initially refusing to pay or withholding supplier payments. For a small business the resulting impact has seen new revenue becoming uncertain and incoming cash becoming much less reliable.
Dealing with these challenges and putting themselves in a position to bounce back as quickly as possible when restrictions are eased, means that businesses need to identify every opportunity to minimise costs, maximise revenue and adjust operations to the new reality.
Adapting to the new normal
With existing revenue interrupted, one option is to see if you can adjust your business to drive some revenue during the lockdown. The extent to which this is possible will depend on your business, but Coronavirus may well create revenue opportunities which, with a little adaptation, you can capitalise on. This idea has been seen to be working well for pubs and restaurants, where a food delivery service has been launched to maintain revenue.
Businesses also can consider reorganising their operations to enable mobile and remote working. For some this may be something that they continue with, long after the pandemic. Ensuring data privacy obligations are met, and that cyber security best practice is adhered to is crucial.
Making ends meet
The biggest concern will be how businesses can make ends meet financially. There is a wide range of support schemes covering small businesses as well as larger corporates and the self-employed.
Even with this support though, the financial balancing act all small businesses face has become much more difficult. Finances will be fragile, and the chances of a cash flow crisis will be more pronounced. To survive, businesses need the flexibility to react to challenges as they happen and to understand how their financial position is changing in real time, often just thinking of survival one day at a time.
This heightens the need for expert support and for improved accounting software such as Xero, Quickbooks and FreeAgent. When maintained properly they provide great visibility of income, expenses and the current cash position. Quick reporting will satisfy the needs of management and lenders to allow an up to date financial position at all times. Most software is available in the cloud so can be set up quickly, efficiently and without the need for install on hardware that may be in different locations.
Packages such as these can be vital at all times, but even more so now. They can help you to assess your financial situation in real time and make it easier to provide all the financial information needed to access some of the support options available. Most of all, they can help you plan ahead and flag up problems before they arise.
Staying safe in the Coronavirus crisis will be easier said than done. It takes a robust strategy, flexible thinking and excellent financial management to achieve your goals of maintaining business continuity for customers, generating revenue and avoiding laying off staff.

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