Business With Low Finance – How To Give A New Start After COVID Loss

The global pandemic has hit the world hard. There are significant financial damages that businesses have faced. 

The damages vary as per the business’s size, but every business is affected in one way or another. Around 160K business closed permanently after lockdown.  

Not only businesses but global economies also suffered due to the lockdown. 

The world is getting normal after the initiation of vaccine across the globe. Though, these heavy damages are still required to be cured.

Let’s discuss some of the practical approaches to give a new start to your COVID loss.  

Evaluate the Financial Damage

The first step in recreating business after COVID is the estimation of loss. It is essential to identify the intensity of loss you have faced during COVID. Categorize your business in the following segment; 

There are different tiers of business that have witnessed loss. The first one is financial loss. Suppose you haven’t maintained your financial statements, including; profit and loss statement and cash flow. Compare these statements with the previous year’s statement and identify the financial loss.

The second tier includes the revenue loss. Evaluate the cost of revenues that you have sold during COVID. It also includes employees who were laid off during the pandemic. 

Reconsider your Business Plan

Business models are the core of any business. Around 20% of business fails in their first year, majorly due to inadequate business plan. Your business plan may work adequately before COVID, but the time is changed now. 

This adjustment is necessary to contrast your business plan with the new normal. For instance, if your business was previously dependent upon brick–and–mortar stores, it will require a digital store. If your employees were working from the office, now they need adequate work from home setup.

Start from the big picture; first, evaluate the overall industrial loss. Look for the market leaders and changes that they have brought in their business functionality. Now make changes in your business plan in accordance with the above evaluation.     

Gauge your Current Financial Need

Despite your financial condition before COVID, the finances are not the same in recent times. Around 60% of small business ran without a budget that creates hurdles in business practices. See the following illustration, which reflects the cash in the hand of different firms.  

Unless you are left with a huge amount of cash in hand, you’ll still need financial assistance to regulate your business.

Different finance organizations can support you in acquiring funds. The government has also announced; Paycheck Protection Program and Economic Injury Disaster Loans. But, these are limited in terms of providing finance.

Due to the larger population segment affected and limited resources, the scheme may be depilated before your application is reviewed. 

Other institutes that can provide you with short-term minor loans are;

• Business loans from credit unions and banks.
• Business credit cards and line of credits.
• SBA 7(a) loan
• Merchant and inventory financing.
• Equipment inventory financing.

Revise your Budget

It may require you to spend additional finances before revamping your budget. For instance, you may need to hire and train new employees to replace those laid off.

Additional inventory and merchandise may need to be purchased and re-marketing of the business also. 

Firstly you have to estimate these expenses and embed them into the new budget. It is a part of recovery that you should have a complete overview of your business’s future expenses.

This will support you in estimating the amount of cash in hand that is lacking. Make sure while budgeting that the main purpose is to eliminate any excessive expenses. One tip is to give yourself a salary rather than taking a portion from profit.   

Fix Milestones

There are many elements of the business that you want to recover after COVID. But it is also a fact that you can’t recover all of it together. 

Therefore, you need to set your milestones. Divide your ultimate goal into smaller segments and track the achievement of every goal. Make sure your milestones are based on prioritized actions.

With each milestone, set a parameter to gauge the achievement and its impact on business. These parameters can be; finances, customer satisfaction, performance reviews, and your expectations from the task.

Adopt Current Trends

The social distancing and wearing a mask become new normal. Similarly, there are many new normal in business.

Using digital sales channels, employees working remotely, and maintaining social distancing is the new normal. All you have to do is to alter your business practices as per the new normal. 

Since lockdown has completely evolved, the markets should align with these trends for survival.  

Take Professional Advice

Taking advice from an expert in any business matter is helpful. They are the professional who is aware of every aspect of your problem. There is 22.5% small business globally, and almost all of these require expert’s advice.

You can take advice from accountants in drafting your new budget and marketing experts to rebuild your market image.

These professionals can also support you in filling out loans and taking support from other financial institutes. It is similar to the research proposal service that students avail for their featureless academic career.

Platforms to Acquire Business Resources 

The sudden changes in the form of lockdown shook the basis of the business. Many businesses were not even prepared to face a pandemic.

In this condition, many platforms came forward to support suffering businesses;

On top of the list is Google. The platform provides free of cost G-Suite facilities. Along with this, they provide all the possible resources and guidelines to run a business digitally. There are nearly 5 million businesses across the globe that is completely dependent upon Google. 

To navigate small business out of the crises, the National Federation of Independent Businesses (NFIB) also supports well. The platform hosts webinars and provides several resources to businesses. They also provide an FAQ facility, where experts will solve the frequent problems you face. 

If you want experts’ advice and support in rebuilding business, then SCORE is there for you. They have volunteered around 10,000 mentors to provide adequate advice and support small business to restart.

The US Chamber of Commerce is also providing several contents regarding rebuilding after COVID. The institute is also focused on providing tax rebate to many organizations, supporting their re-launching.

Exclude the COVID Loss

The pandemic was unexpected for many countries in the world.  People were unaware of the disease’s intensity and were considered a normal virus. The modern world has witnessed the pandemic for the first time, so many businesses were not mentally prepared for this. 

The under-preparedness of businesses creates significant hurdles in adopting the new normal. All of these factors combined to create a significant impact on the financial conditions of businesses. 

Though the world is normalizing again, and businesses are getting back to a normal routine. A lot of effort is required by business owners to rebuild their businesses again.