By Brandon Martin
As the uncertainty surrounding the coronavirus pandemic continues to grow, some small businesses have already been forced to close their doors for good.
To help remaining small businesses decide their next move, the non-profit organization, SCORE, recently hosted a webinar to give guidance on planning in a time of uncertainty.
“Predicting the future is difficult but business owners are asked to do it all of the time,” SCORE mentor and presenter Suzanne McGrath said.
In the webinar entitled “Reopening & Staying Open: Using the last 60 days to prepare for what’s next,” McGrath presented an overview of the challenges facing businesses and how to plan to survive a potential second shutdown.
She said business owners are not only facing a host of professional questions but also personal crises that are “very emotional” and can “create depression and paralysis.”
While it is difficult to have advice for every individual situation, McGrath said that the goal of the webinar is to “create a framework for business owners to ask the right questions and figure out their own best way to move forward.”
McGrath said that August through September is a great time to start looking at how to move forward because more information is now known about the pandemic and how it affects businesses. Also, it’s typically a time that businesses “press the pedal” to try to meet fiscal goals in the fourth quarter.
The first step of the process, according to McGrath, is to review experience.
“You do have a lot of information already,” she said. “Review that information about the pandemic so far. How has it affected your business? Use that as your road map.”
Some questions that businesses should ask themselves at this point are:
*How has your business been impacted? Did you have to close?
*Was your staffing affected?
*How did your customers respond?
*If you closed and reopened, what percent of business came back?
*How was your industry affected and how did it react?
*What is your financial condition? To what extent have government loans or grants helped your financial situation?
*What is your personal situation? Is COVID-19 creating personal pressures that are impacting your ability to run your business?
Once these questions have been asked, McGrath said the next step is to extrapolate the future.
“You’ve probably already asked yourself many of these questions,” she said. “The goal is to review that information in one place to see what questions you haven’t asked yourself. You don’t want to guess but use your experience so far to see how it will affect what might happen in the future.”
At this point, business owners should ask:
*What is your best assessment/prediction of what will happen in the next 6-12 months?
*If business returns to normal now, in 6 months, or in 12 months, can you survive? If so, would you have to make any changes?
*Under all these scenarios: what sales/revenue volume do you have to have in order to survive?
*Can you manage any credit or lease payments you have now, or would those have to be modified? If so, how?
Once this self–examination has been done, McGrath said it is time to crunch the numbers.
“It’s great to have experience. It’s great to have a gut but it’s also great to have these validated by the numbers,” she added.
To help, McGrath said that business owners should have a 12-month projected Profit & Loss