Although big, household names such as Amazon, Google, and Walmart get most of the headlines, small to medium sized businesses (SMBs) are really the backbone of the American economy. In fact, SMBs makeup about 99 percent of all businesses in the US and employ almost half of the private workforce, according to the U.S. Small Business Administration. During the pandemic, however, SMBs have been among the hardest hit. There are many unknowns in the post-pandemic economy. Small and medium-sized businesses need to start planning now and be prepared to adapt to new conditions and remain flexible. Here are a few important ways to do this:
This will help increase cash flow and make your business more nimble. If possible, try to pay off any outstanding loans or debts. If not, see if you can restructure your loans to get more favorable terms. A quick check in with your relationship or business banker for a credit review will ensure your debt has the most favorable terms possible and can help guarantee that your cash flow will be adequate to weather any economic storms.
Focus on Innovation
Innovating is key for small businesses to survive in an ever-changing landscape. It's always important to be thinking about how you can improve and innovate your products or services, but especially so in times of uncertainty. What new features can you add? How can you make your business more efficient? Can you tap into new markets? The businesses that survive and thrive post-pandemic will be the ones that constantly think about how to improve their offerings.
In any economy, it’s important to nurture business relationships. If anything, the pandemic has only emphasized the importance of human connection, even (or perhaps especially) when we can't be together in person. Make sure you're staying in touch with everyone who contributes to the success of your business. For your customers and vendors, a phone call, email, or even a handwritten note letting them know you're thinking of them and that you value them can go a long way towards building loyalty and repeat business, which is essential for small businesses. Keep your business banker, CPA, and attorney close and knowledgeable about your finances and plans. If you haven’t had a chance to chat with them or have a meeting to review your relationship recently, now is the time to do it.
Adopt Digital Tools and Resources
The pandemic has forced many businesses to move online and adopt digital tools and resources. If you haven't done so already, now is the time to make the switch. Invest in a good website, learn how to use social media for business, use business online banking and start using other online tools such as Business Online Banking tools, project management software and customer relationship management (CRM) software. Not only will this help you run your business more efficiently, but it will also position you well for the future. Ask your business banker or CPA for suggestions on what tech tools will help you get the most bang for your buck and add to your tool kit of digital resources.
In today’s data-driven world, it’s more important than ever for small businesses to use data to make informed decisions. By collecting and analyzing data, you can gain insights into your customers, operations, and finances that will help you make better decisions about where to allocate your resources and navigate the post-pandemic economy.
The post-pandemic economy will present many challenges for small and medium-sized businesses. Position your trusted advisors – business bankers, CPA, and attorney to help you help your business. By taking some proactive steps now, you can position your business for success in the new normal.