How Small Businesses can Survive the Impact of Coronavirus?

With a significant disruption to economic activity and international trade, the world is quickly sliding into a recession. Sequoia Capital, a venture capital firm based in Silicon Valley has released a memo that it sent to its funded companies. The note comprised of three major parts: stay healthy and safe, impact are/would be occurring on business revenue, and advice on dealing with potential business consequences of the coronavirus.

While it may feel like that there is little you can do during this pandemic, it is important to know that many successful companies have been created before in times of recession. Every so often, challenging times can bring the best out of us. This makes it possible to come up with innovative and creative solutions, not just to succeed but to survive difficult situations. Major companies like Uber, WhatsApp, Square and Pinterest were all started in 2008 and 2009.

Let's now dive into some of the beneficial tips for startups that are funded or seeking funding, and also to small businesses in general that are struggling during this pandemic.

Take charge of your cash flow: We all have heard the saying that it is important to save money for a rainy day. That day is here and now. Hence, take a look at the cash on hand and make plans on how it could help you last for at least next three to six months. Alternatively, if you do not have sufficient cash on hand, plan on cutting your expenses or increase sales by doing something unique.

Revisit your sales forecasts: If you are still working on achieving projections that were set before the ongoing crisis, you might need to review it again. If revisions need to be made, set yourself a realistic target. The objective is not just to lower your projects but if possible, devise measures that could help you sell more of your products or services. There may be new markets to touch, new audience to reach, or even a partnership to be made.

Devote more creativity, less cash in marketing: When starting your business, you might have relied on word of mouth and network as ways to market your products and/or services. There is also the organic social media strategy to help you cut down on your marketing expenses. In other words, be creative and take initiatives that help you promote your business without costing you a lot.

Keep expenses to a minimum: As you examine your cash flow, look for ways to lower employee expenses. During the ongoing lockdown period, travel and event are already halted. If you need to hire additional manpower, you can look for freelances or contractors instead of full-time employees. Also, allow your employees to work remotely.

Small businesses and startups that survived the financial crisis of 2007-08 didn't take dangerous risks that would threaten their companies existence. At that time, survival mattered to them more than success. Hence, take the appropriate actions that help you come out of this crisis stronger than ever.