Whatever your perspective on the coronavirus may be, its potential to cause severe social and economic disruption cannot be denied.
The outbreak will (indirectly if not directly) damage or kill many businesses, large and small - choking demand; disrupting supply chains; and derailing day-to-day operations. Some industries are already deeply affected, others have yet to see the full effects.
Small business owners need to be planning and preparing for the worst.
Financially, small business owners need to be thinking about the potential impact of coronavirus-related activity on cashflows. This includes:
- Understanding in detail your business's cash requirements for the forthcoming weeks and months.
- Identifying which cash outflows are essential and which are discretionary.
- Potentially, delaying discretionary elements - advertising and marketing; staff training; conferences; entertaining; non essential repairs & maintenance work.
- Potentially, delaying capital investment - or financing, rather than buying outright.
- Seeking extended credit/ deferred payment terms from suppliers; landlords; banks; even HMRC.
- Making sure you get paid on time by your customers - enforcing credit terms; applying credit safeguards; automating your debt collection.
Operationally, some pointers may include:
- Protecting employees from exposure in the workplace - ensuring staff with symptoms do not come to work (or are sent home straight away if symptoms develop at work); promoting handwashing; providing the right sanitary facilities.
- Enabling staff to work from home - can administrative, finance, or even operational staff work remotely? Do they have the technology to do so - if not, shouldn't you be setting that up now?
- Avoiding non-essential business travel.
- Avoiding large gatherings - attendance at large corporate events etc.
- Reviewing supply chain risks (stocking up or sourcing stock from less affected areas?)
Strategically, now may not be the time to be embarking on an acquisition spree or launching new products.
Many small businesses are already feeling the pain and it's horrible. Some won't make it. By anticipating the potential impact on your business and taking sensible steps to protect it now - not once the proverbial sh#t has already hit the fan - you will maximise your chances of still being here in a year's time.