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Operating during COVID-19: 10 Tips for Businesses
Though owners may fear that they are unable to combat any of this upheaval, there are some steps that can help them gain control and curtail financial losses.
The ongoing COVID-19 (coronavirus) pandemic is affecting nearly every aspect of daily life from schools to transit to businesses. Because the situation is evolving daily it can be difficult to determine the outlook for the markets, dollar and other economic factors. It’s unclear when this tumultuous period will come to an end but at least in the short-term businesses can expect more uncertainty and volatility. Though owners may fear that they are unable to combat any of this upheaval, there are some steps that can help them gain control and curtail financial losses.
- Renegotiate: Try calling landlords, vendors, partners and anyone else with whom you have a financial relationship and see if there is a possibility to delay bills, renegotiate rates, or develop a payment plan. Bring concrete plans and options to clearly present your case. Though it is not guaranteed, if even a few parties agree it could help free some cash flow needed for other areas of your business.
- Prioritize: Consider what elements are essential to your business and what will best ensure future sales. For example, staff, product supply, new technology, etc. Many operations will have to think about cost-cutting in the near future. Create revised plans for the rest of the year and determine what parts of your business are the most important.
- Closures: By now many businesses have temporarily shut physical locations in an effort to stop the spread of COVID-19 (coronavirus). Owners should consider if they should reduce hours or re-distribute tasks based on shifts in demand. Evaluate the feasibility, cost and lasting impact of each scenario, even if all employees can work remotely.
- Overseas sourcing: Global supply chains have been hit hard by this pandemic. While some factories in China are restarting, it will take some time to resume regular volumes. Businesses should consider diversifying. Prepare for any future shortages and, if possible, stop relying on a single source for critical materials.
- Government assistance: Updates on possible stimulus bills or business relief efforts are continuous. Consult government websites in the United States and Canada for accurate and up-to-date information on legitimate programs, particularly as scams are becoming widespread.
- Foreign payments: With foreign currencies on a roller-coaster of gains and losses, once-stable FX invoices can now be wildly unpredictable. Depending on when invoices are received and paid, the actual cost of a bill in dollars can vary substantially. If your company conducts significant business with international vendors, partners, staff and more, it might be worthwhile to look into foreign exchange risk management strategies such as those without an upfront cost.
- Reduce expenses: No matter how lean your operations are, it’s understandable that a business would have unnecessary or redundant costs. Now is the time to review each regular invoice one by one. Cutting or delaying a few items can allow additional cash flow – immediately.
- Move online: It may be that case that all aspects of a business can not be conducted in a digital environment, but maintaining an online presence is critical for the maintenance of customer relationships during prolonged closures. Use websites or social media accounts to answer queries and provide business continuity plans. Businesses have gotten creative by launching video sales pitches and museums are hosting virtual tours. Find your own way to stay top-of-mind with your customers utilizing low-cost options.
- Cultivate new business: While sales conversations can be difficult in times like these, it’s important to continue developing new relationships. Even though the immediate focus will likely be servicing current clients in order to retain existing business, eventually organizations will need to gather new sources of revenue. When the economic tide turns, companies will be glad to have burgeoning customers in the pipeline – instead of starting from scratch.
- Emails: Most companies are sending their customers updates regarding the COVID-19 pandemic and their business continuity plans. Unfortunately, this means that every customer is likely receiving a large quantity of emails. Businesses should take a more personalized approach and segment their base, where possible. This will ensure you contact each customer with information specifically pertaining to their situations and challenges. Consider highlighting case studies, helpful advice, and other cost-free content to showcase your value outside of just sales.