COVID created uncertainty. We are thankful to our business partners, colleagues and friends who continue to share productive ideas and best practices for business survival and market opportunity.
With that said, we wanted to share some “Best Practices for Business Owners During COVID” that we received from our friend Andrew Durfee, First Vice President, Wealth Management at UBS Financial Services.
Below are steps business owners can take to help their business survive this difficult stretch:
Keep Your Loan Current
If you have a business loan, it’s important you keep your loan current. It may make an important difference for business owners seeking access to relief lending programs.
Understand your cash flow, what lines of credit and lending options you have as well as taking advantage of applicable business insurance.
Execution & Planning
Business owners should continue to focus on execution and planning. The first priority should be to successfully operate the business over the next several months. Implement business continuity plans to safeguard employees, customers, suppliers, and all stakeholders and work to ensure there is limited disruption to operations.
Reforecast short-term budgets and long-term financial plans regularly, maybe even as often as weekly. Understand any liquidity constraints the business may have and take measures to shore up financing and insulate the business in the event of a drawn-out potential economic downturn.
Focus on Cybersecurity
You’ve likely implemented a remote working environment. Remember important items like cyber and data security, including the actions of your employee’s spouses and children, as well as maintaining a strong work culture while social distancing.
Use technology to your advantage and throw out old paradigms that are quickly changing given a new reality.
Managing Business Transition
For business owners who were about to start a process to monetize their business through a Mergers & Acquisition (M&A) process, the world may now look suddenly very different. Once the business is stable and management capacity is available, re-evaluate pre-M&A planning work.
For years to come, potential investors and business leaders will be evaluating operational and financial performance of businesses during this period in order to measure the cyclicality and overall resilience/risk profile of a business. The best course of action for each business is unique, but management teams will also be measured on how they navigate this environment.
To the extent possible, owners should track any coronavirus related impacts on their business and expect that at some point they may need to explain in detail how and why the business performed the way it did during this period of disruption. Also consider tracking “exceptional” events like contract delays, customer order cancellations, overtime costs, sick leave, supply disruptions, elevated transportation costs, etc.
Thank you, Andrew Durfee, from UBS Financial Services for this sage advice.