The coronavirus pandemic has spread across the globe and businesses of all sizes are reeling in its wake. As the initial smoke clears, many entrepreneurs are left uncertain what to do next.
After all, how exactly can a company survive when its events/projects/earning opportunities are being discontinued – or worse, prohibited?
Fortunately, there are ways to bolster your business during this challenging time. Here are several ways how.
Optimise your burn rate
Burn rate is defined as how quickly a company uses up its cash reserves to pay for operating costs before generating its own income. It’s also used as a gauge how much time your business has left before it runs out of money.
To help keep your company operating, examine where it’s spending its money, and which can be avoided or minimised. Possible non-essential expenses you can pause during the pandemic include:
- Office space
- Leased equipment
- Capital improvement projects
- On-demand software
Your objective is to be as lean as possible during the lockdown.
Pivot to online
With a few adjustments, most brick-and-mortar businesses can shift their sales strategy to online to minimise losses. If you pivot well enough, you could even do better than before.
Case in point: cosmetics company Lin Qingxuan had to close 40% of its stores during the pandemic (including all its Wuhan shops). To make up for this, the company redeployed beauty advisors from its closed stores to engage customers and drive online sales through platforms like WeChat. The result – Lin Qingxuan’s sales in Wuhan hit an impressive 200% compared to the previous year’s sales.
But what about businesses that provide services in person? Here are a few ideas you can borrow:
- If you own a restaurant – offer video courses on how to cook certain dishes at home.
- If you own a spa – offer online training on how to do different types of massages.
- If you own a fitness studio – hold your gym classes via video calls.
To improve your chances of success, promote your product or service via low-cost online marketing options like social media, search engine optimisation, and building an email list.
Study your competitors
The pandemic is affecting businesses differently. Many struggle, others go into hibernation, while a select few thrive and gain market share while their rivals sleep.
To get a better idea on how you can strengthen your own business, study those who are performing well and find out what they’re doing differently.
But don’t just study any business; analyse your indirect and direct competitors. Why? Because some approaches won’t necessarily apply between different industries. To minimise risk, you need strategies that you know would work on your own business as well.
Consider how your customers are thinking
Conservatively speaking, COVID-19 will likely be affecting your business until the end of 2020, or at least until vaccines are available. However, you’ll need to look beyond that timetable, particularly how the pandemic will influence how your customers will think mid- to long-term.
For example, it’s possible that a larger percentage of consumers will shop online more frequently even after the lockdown – maybe because they’ve gotten used to it and would rather minimise risk by staying indoors. Perhaps this will permanently shift consumer preference to online shopping.
If you run a brick-and-mortar store or bistro, how will this behaviour change affect your bottom line? What can you do to offset this change? Is integrating a delivery service into your operations feasible?
You then need to make adjustments to your own business model appropriately.
Invest in self-improvement
At this time, you’re probably holed up at home because you’re following the recommendations of medical experts. Whether you’re continuing your business or not during this time, don’t view it as an impediment to your success.
Instead, regard this lockdown as a chance to improve your business-managing skills. Here are a few useful activities you can pursue:
- Look into other entrepreneurs who have achieved goals similar to yours.
- Read books, attend webinars, or listen to podcasts that feature expert advice on running a business.
- Research more about your market and study the data to better understand your segment.
Remember how studying your business meant burning the midnight oil? The quarantine actually enables you do this at your own pace and still end up accomplishing everything at less time.
Find other ways to earn
Sometimes, it might not be feasible to devote a large amount of time and money into your company during the lockdown (e.g. you own a travel agency or movie theatre).
If this were the case, think about earning a living using your other skills – like through freelancing or consulting – provided that you can deliver them online.
In the meantime, if you can temporarily reduce your burn rate to zero or close to it, you can put your company in hibernation mode. When the pandemic blows over, you can then return to your business.
Prepare for future issues
The pandemic is a wake-up call. Clearly, we weren’t ready for anything like this, despite the occurrence of epidemics (like SARS, bird flu, dengue fever, MERS) in recent years.
One thing is certain: another outbreak will likely occur in the future – and it might not be necessarily global like coronavirus – but we need to be ready for them.
Ask yourself: How can you set up your business today so that it won’t be as affected by pandemics and other global factors? Here are a few suggestions:
- Consider business interruption insurance. If you already have a policy but it doesn’t cover pandemics, get one that does so that you’ll be prepared when something similar happens.
- Call your supplier. Ask them how you can work together to minimise future disruptions.
- Develop brand loyalty. Having more devoted fans will help you through difficult times.
- Diversify your company’s revenue stream. There are several ways to do this, like selling a product or service that complements your core offering, or a paid membership program.
Partner with us
Another effective way to strengthen your business during the pandemic is by forming a high-performing remote team, which will reduce your recruitment and salary costs, and give you access to a larger talent pool while enjoying the reliability of in-house staff.
To make your recruitment easier and more effective, team up with Remote Workmate. Unlike freelancing marketplaces where you do everything yourself, we handle all the heavy lifting for you, including processes like screening, recruitment and payroll.
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