The COVID-19 outbreak has crippled the world’s economy. No one ever thought that a tiny virus could shut operations all over the world. Each country has been tackling this situation since December 2019 in the best interest of its citizens and businesses. One of the common solutions has been country-wide lockdowns.
Though implementing country-wide lockdowns was effective in saving millions of lives, it also wreaked financial havoc around the globe. The lockdown has negatively impacted many small and medium businesses in India as well.
Assess your financial damage from COVID-19
The first and foremost step of the recovery plan is to assess the quantum of the effect caused to your small business by the COVID-19 outbreak.
There are different layers involved in such financial assessment, starting with the hard numbers. It will be helpful to update your financial statements such as profit and loss accounts or cash flow statements. You can then compare them to last year’s figures to know how much your business has been affected.
Your business plan might need a second look
Your existing business plan might have worked for you in the pre-COVID era, but it might need some fine-tuning to grow in this new normal.
You may need to analyse how your business plan can be tweaked to adapt to the new normal and flourish. For example, if you were dependent on foot traffic for your sales, you may need to expand your business digitally and attract new customers who are shopping from home now.
Many organisations are trying to guide and provide requisite resources to small business owners looking to rebuild their business. We, at Razorpay, can provide you with a full payment solution for your business too. This will help you collect your payments digitally and maintain social distancing at the same time.
Your business might need funds to recover after COVID-19
Unless a small business owner has a hidden treasure at home, it is very likely that the business will need some funding to restart its operations.
There are several financing options that you can consider for your business. The government has also recently announced relief measures for small and medium businesses in India.
Revisit your budgeted amount for spends
The early stages of recovery may lead to more spending than revenue. You should prioritise expenses to make most of the revenue coming in. The focus should be to eliminate the waste of money and prepare a lean operational budget for the business.
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Set up a timeline for revival
There are several action items to be completed to fully recover from COVID-19 outbreak, but doing everything at once might spoil the plan.
For a small business that was closed due to the pandemic, your immediate goal should be to secure funds for your business. Once this is figured out, you can consider rehiring employees and follow it by stocking up your inventory. The step-by-step approach will help you plan accordingly.
Be prepared for any next big crisis
We shall promise to not take anything for granted in future. While the pandemic may seem like a once-in-a-lifetime experience, the reality is that any unpredicted situation can disrupt your small business.
The COVID-19 outbreak has taught us to always have a contingency fund that can help you and your business sustain and move further. You can create this fund by trimming down your unnecessary operating expenses.