With many companies working in lockdown because of the Coronavirus pandemic, it’s essential that business owners plan for recovery. We’d like to share a few tips to help your company stay alive and emerge strong.

During this COVID-19 pandemic, it is natural for company directors and business leaders to be worried about the wellbeing of your staff as well as the health of your business. But amid such uncertainty, company owners and directors must think about the ‘day after tomorrow’. At the moment, no one talks about business recovery because no one is sure if this virus outbreak will last for weeks or months. But if we are to learn from China, we can see that their new cases have significantly declined after 40 days of lockdown. Although China has yet to be totally free from the virus, businesses have started to trade once again and consumers have begun to venture out, albeit maintaining social distancing.

And if we are to look further back at the 2002-2003 SARS outbreak, we can see from the data that consumer spending quickly returned to normal for basic items, but demand for clothing actually surged beyond pre-outbreak levels, as reported by Reuters.

As such, it is possible that we can soon say, “it will pass”. In the meantime, let’s take a moment to discuss what you can do to keep your company alive and plan for its recovery.

Short-term measures to stay alive

1. Make use of government assistance

The government has announced a raft of measures that are designed to assist businesses mitigate the pressure of business rates and sick pay. Grants are also being made available to small businesses eligible for small business rate relief (SBBR) to help meet ongoing business costs. Take advantage of these where appropriate. Beware though, some of these may cause your business problems later, especially if they come in the form of a loan to be repaid in the short-term.

2. Conserving cash

Company directors know the importance of cash so limit all non-essential spending. Put on hold planned capital expenses and ease off on expenses. Travel and entertainment expenses should be reduced significantly given the current climate. Other expenses like new office equipment and training could be reviewed too.

3. Focus on your core competencies

If your business has embarked on ventures outside of your normal core business, perhaps as part of a business expansion strategy or an attempt to diversify your revenue base, consider holding back on these for the time being to conserve cash and resources. Focus on the heart and strength of your business.

4. A shift in strategy for F&B businesses

Restaurants, cafes, coffee shops, bars and pubs form an essential part of our communities and foot traffic is their life blood. If you are in the F&B sector, consider how your business can shift strategy and take advantage of the take-away model, using the internet and the delivery companies to fulfil orders when things are tough. Even some pubs have started to move to a home delivery model for both food and drink to help ease the pain.

5. A lesson from the supply chain

We all know that within any supply chain, a problem with one part causes problems for the entire chain, so to avert a longer-term business crisis, it is essential that business owners, clients, suppliers, landlords, and employees all work together and are willing to make sacrifices and help one another. Be prepared to negotiate with your staff, stakeholders, landlords, even clients.

Planning for recovery

Business planning is at the heart of a successful business operation and so is planning for an eventual recovery, although the type of crisis companies face at present is not something they encounter very often.

It is worth noting that unlike the financial crash in 2008, this time almost all industries are severely affected. If you are one of the many affected companies, do not attempt to think that this short-term break means you can afford to ignore your customers. The reason is that your customers now have time on their hand to reevaluate many aspects in life, from how they are taking care of themselves, how they choose to shop, how they will holiday in the future, to name but a few. Once the pandemic is over, you may even see two distinctive trends:

• A strong spending spree as consumers decide to seize the present moment.
• A shift in consumer mindset when it comes to personal wellbeing and the environment.

Needless to say, your business must have robust plans to engage your customers during the crisis and meet the demands of post-pandemic consumers.

What will be the new normal?

The business world will likely be a different place after the pandemic. The rush to get out and meet with people after being restricted for weeks may seem certain, but there may be reluctant to do so. So it is likely that people will emerge far more cautious in their behaviour than before. Allow time for your clients and customers to adjust.

When the pressure is relieved and life begins to return to normal, businesses will need to rekindle discussions and agreements. Be prepared to see new deals as well as adjustments to old deals that seemed so certain before the pandemic.

Sound business advice

When your business is making cutbacks during this difficult time, it is tempting to cut back on marketing. This decision is potentially disastrous as your clients (and potential clients) are likely to be considering their options now for when they emerge from this catastrophe. You need to be visible and stay relevant for the clients of tomorrow and your marketing activities will help you achieve that.

In a time of crisis, position your business in a way that your message is about how you can help your clients and your potential clients is loud and clear.

Berley, your trusted business advisers

At Berley, we are small business accountants helping entrepreneurs to thrive across London and we are also business advisers in helping companies through difficult times.

If you are worried about the health of your company during this current Coronavirus pandemic, we can help to:

• Assess the impact on your business operations
• Assist you in finding the right assistance
• Help you recover by putting stringent financial stewardship in place
• Ultimately, we want to make sure that you have the opportunities to grow again once we all emerge from this crisis

Send us an email at info@berley.co.uk or take a few seconds to fill up our Online Enquiry form. We will be in touch soon.
https://www.gov.uk/government/publications/guidance-to-employers-and-businesses-about-covid-19/covid-19-support-for-businesses