As coronavirus continues to spread around the world, its financial impact is also becoming more obvious. The United States of America has been one of the hardest-hit countries in terms of healthcare and economic front. More than 3 million Americans filed for unemployment just in the first week of March! Small business owners are also on the list.
Here are some tips for small businesses to keep their operations afloat:
Assess the damage
Before rebuilding a COVID recovery plan, you need to determine the extent to which your business has been affected by the pandemic. When you get to it, start with the hard numbers. Update your financial statements according to the changes in cash flow. Compare the new statements to those of last year and compare the figures. The difference will tell you how much you need to recover.
After you’ve analyzed the numbers, consider other factors. Have you laid off any employees? Did you lose any customers? Have your customers chosen your competitors over you? Once you’re clear on the extent of losses, it’ll be easier to identify the financial sources you need to win these back.
Reconsider your spending patterns
Once you begin recovering from the financial consequences of the pandemic, you will no longer be spending as you did before. If you’ve laid off employees in the past, you’ll need more money to hire and train new ones. If you’ve cut down your marketing budget, you might have to take it up again to start generating leads again.
Before your business enters the recovery phase, you’ll need to have a clear idea of your budget constraints. You need to know how to make the most out of your revenue. Try and eliminate monetary waste as you can to get the operating profit back on track. Look for opportunities to invest. Try and manage your finances so that you don’t have to resort to salary cuts or deferred payments to employees. You can skip out on your own paycheck for a month or two to get the business back on its feet faster.
Explore private funding options
Although the government has announced several programs and schemes to help businesses regain their lost ground, it definitely isn’t the only option. If you’re struggling to pay off business obligations or need extra cash for business expansion, consider private lenders.
There are many venture capitalists, and angel investors that provide equity financing at easy interest rates. Private lenders don’t necessarily many regulations to comply with; therefore, you can quickly obtain the loans. Private lenders are also a viable option if you have been turned down by a bank loan. Banks offer loans based on your credit score, whereas private lenders are more concerned about the value of the collateral.
If you’re based in New York, Global Capital Partners Fund, LLC is offering easy hard money loans for small businesses to help regain their position in the market. Get in touch with to learn more about the details of their commercial financing solutions.