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Ways small businesses can weather financial uncertainty The uncertainty wrought by the pandemic has affected people from all walks of life. The outbreak of the novel coronavirus, and the ensuing measures implemented in the hopes of curbing its spread, changed the way people live and how companies do business. Some companies have thrived during the pandemic, still had to be honored, even if companies were no while others have faced unprecedented challenges. longer generating revenue. Many small businesses Many small businesses have been hit especially hard operate on slim margins that make it hard to save while navigating regulations, prompting owners to while still improving the business. But small business express concerns about their long-term viability. A owners who make concerted efforts to build their recent MetLife & U.S. Chamber of Commerce Small cash reserves without compromising their offerings Business Coronavirus Impact Poll found that 70% of should be in a better position to withstand financial small business owners are concerned about financial uncertainty in the years to come. hardship due to prolonged closures, n Watch inventories carefully. The Small while 58% worry that they will have to Business Administration recommends Effective permanently close their businesses as a that small business owners keep watchful result of the pandemic. eyes on inventories. The goal is to ensure planning can Few people, if anyone, likely saw the you can continue to meet sales needs pandemic coming, which is perhaps why help small without ending up with a stockpile of the resulting financial uncertainty has leftover merchandise that’s difficult proven so difficult to comprehend. As the business to move if or when retail sales slump. months go by and COVID-19 case numbers Stocking up on more than you need to owners again remain steady, small business meet sales needs can eat up cash that you owners are understandably concerned weather can otherwise use to build your reserves. by the potential implementation of n Reduce rented space if possible. One additional measures to stop the spread of financial the virus. However, there are steps small potential positive that may come from storms that businesses can take so they’re ready for the pandemic is that many workers any additional financial uncertainties that and businesses deftly handled the can arise arrive in both the near and distant future. transition from in-office working to remote working. Small businesses that n Build cash reserves. Cash on hand can unexpectedly. successfully made that transition can help small business owners in much the safeguard themselves against future same way that sizable savings accounts uncertainty by reducing their office space. Small can help laid off workers overcome a sudden loss of business owners can renegotiate existing leases to income. Forced closures hurt many small businesses allow for subleasing or simply move into smaller because their bills still came due even if government offices when existing leases expire. Money saved on officials deemed them “nonessential” and forced them office rentals can be redirected to help businesses to close. Rent was still due each month and, in many instances, contracts signed prior to the pandemic grow their cash reserves. 16
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