What are your biggest financial concerns during the coronavirus outbreak?
As a SMB owner/professional, how have you been financially impacted by the coronavirus? What precautions are you taking to try and protect yourself financially?
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Mar 17, 2020
At The Debt Relief Company, we were forced to act quickly due to an internal scare within our company. Immediate steps we have taken to both protect our business and ensure workforce productivity moving forward are as follows: We immediately purchased laptops for all employees and and are allowing all of our team members to work from home. Following this, as a precautionary measure, all employee activity will be monitored for a two week period to assess the change in productivity and assess employee working habits outside the office. Unfortunately, any employees which perform poorly under the new circumstances and change in production could be subject to lay offs. The current economic and small business impact of Covid-19 has most definitely been unfortunate but we believe that our quick acting and adaptability regarding the change in business activitiy will help us move past any immediate financial concerns and impact to our business. We would love to retain all current employees if possible but this may not be a possibility given the current coronavirus outbreak and economic landscape.
Those who fail to adapt often get left behind when siginificant economic shocks hit the economy (as is the caese with the current economic shock from Covid-19) and we are putting all our power and energy into streamlining the adaptability of company. With all this being said, ZOOM has been a life save and remarkable resource for maintaing team meetings and productive collaborations.
Mar 17, 2020
Cash flow is the biggest impact that every small business owner. The steps that are should be taken are 1) Let go of poor-performing employees. This is the first change that will help with cash flow. 2) Introduce the idea of furloughs and ask all staff to take a week or two off without pay to help lower the payroll amount. 3) Ask all staff members to take a 10% pay cut across the board. These are the first steps to help with cash flow in the midst of a community crisis and a downturn.
Mar 17, 2020
Thanks for the feedback, very helpful. When do you think the appropriate time is for employers to take some of these steps? We know there will be impact to SMB's from COVID-19, what we don't know is how long.
#1 - Is this a step that should be taken anyway? The challenge with timing is this leaves someone to have to find new work in hard economic times, versus doing this on a regular basis with poor performing employees, right? At the same time, we all have to protect our businesses and our families.
#2 - Do you know if there is any government regulation or potential issues with doing this?
#3 - Creative piece of advice here. We're all in it together!
Thanks for your feedback.
Mar 19, 2020
Letting go of an underperforming employee should be done immediately. This is always good business. In times of a downturn, for every employee, you carry for an extra payroll those are real dollars that could have gone to your bottom line. For any employee you keep that you know you will eventually let go, those are wasted dollars. Employees that are released have the capacity to get unemployment. Businesses can care for employees that they let go in a variety of ways such as taking them food, having others on the team call them to check in on them, and giving them a positive referral.
Mar 23, 2020
Financial indices that generally correlate to the cost of capital for businesses (US Treasury Yield, Prime Rate, etc) have dropped sharply, but it has not led to an increase of capital availability because lenders see small businesses as riskier investments at this time. If you have a loan coming due, it might be a difficult time to refinance.
The government is rolling out stimulus packages and the Federal Reserve has dropped interest rates as much as possible in order to combat the sudden liquidity crunch. There are emergency SBA loans available to owners of small businesses impacted by the virus, and at attractive interest rates.
Mar 25, 2020
Its a simple question but multiple answers.
In single line… DEFINITELY it leads to rescission without any doubts… because of only one reason.. EVERY PRODUCT or UTILITY in this world depended on components (from mobile to Airplane) from China…
Hence cascading effect and coming two quarters will show this and hence economies go to rescission and other economic effects.
NO ONE can assess about the effects perfectly. Being a senior person, what I can say, please keep cash or gold reserves and prepare so that you can survive for 6 to 12 months without job.
Sorry if I am too pessimistic but that is the reality.
This is great insight into what you're doing and what others should be thinking about. Appreciate the comments/feedback.