Stephen Covey wrote that you must “take control of that which you can control”.
Facing a potential crisis such as coronavirus, is extremely challenging and a detriment to your business. Circumstances out of your control, coupled with the uncertainty of the future, can cause business owners an increase in stress levels, leading to erratic and unwarranted decisions. Construction of a well-developed action plan can help ensure your business’s survival during these challenging times.
Some concerns we are consistently hearing from clients:
‘We aren’t able to fill the shelves with stock as our supply chain is compromised.’
‘As the crisis unfolds each week, fewer customers are coming into the shop and a noticeable increase in online orders.’
‘If the crisis continues for much longer, I have serious concerns on cashflow and the longevity of my business.’
In response to these concerns, we recommend the following implementations to minimise the virus’ effects on your business:
- Consider and investigate alternative supply chain options to cover risks and reduce unnecessary expenditures
- Minimise all unnecessary travel – especially international travel to any severely affected regions
- Develop a contingency plan for any disruptions to the average workday (e.g. prepare staff to work from home – have access to files and laptops in case of events that prevent personnel from coming to work)
- Communicate with key stakeholders (both internal and external) about how operations will be affected
- Review and understand your obligations to staff members in the event of stand-downs
- Reforecast your profit margins and reevaluate your cash flow budget
- Have your finance arrangements reviewed and if appropriate or necessary, seek loan repayment deference or look to refinance to take advantage of better terms
- Review debtor’s policies to ensure payment capability in the likely event of financial hardship
- Examine the various government initiatives and follow up those that may provide some financial or other relief in the period of hardship
- Seek professional advice on any financial decisions you make moving forward
The effects experienced by most businesses during this crisis will be complex, requiring more personalised solutions than just those tips listed above. For the issues that cannot be solved or circumvented by a standardised answer, we highly recommend seeking professional advice.
Engaging in a planning process allows you to control the ‘controllable’ and potentially turn issues into opportunities, ultimately allowing your business to survive challenging times.
At Morrows, we are committed to helping our clients plan for any crisis. The process can be challenging, particularly when considering what needs to happen in a worst-case scenario. Contact the Morrows Strategic Business Advisory team to discuss how our Scenario Planning process can help guide your business’s survival plan that includes different approaches for varying severities of crisis, as well as identifying opportunities for improvement.