I have always had a healthy respect for small business owners and entrepreneurs. Whether they started their businesses out of a dire need for employment or had a vision and just went for it and created a livelihood for themselves, I think it is very brave and their hard work and perseverance deserves admiration.
We currently find ourselves in unprecedented times. Apart from the social impairments, we are experiencing by not being able to have contact with our family and friends, our working lives also had to adjust drastically to adapt to specifications in order to flatten the curve. For small businesses, this lockdown and the subsequent restrictions placed on businesses, have a monumental impact. However, entrepreneurs are known for their determination, perseverance, creativity, and tenacity. These traits are exactly what is needed in times like these.
Some of the most important aspects to focus on is ensuring that you keep costs to a minimum while trying to find new, creative ways to keep your operations running. While doing this, you also need to strategise and be forward-thinking on how your business can recover and be even stronger in the future, and above all, to remain ethical and take care of your employees and customers.
Although keeping costs low has always been important, there is no better time than the present to instil this practice. Most small businesses’ biggest expenses are salaries or wages and while it might be easy to lay off employees, it will definitely not be the best for the broader community. Therefore, before laying off employees and starting a ripple effect of financial distress, rather start reducing other costs. Luckily, as the majority of small businesses were started with little or no money in the first place, this is something that small business owners and entrepreneurs can manage well.
Large corporations and financial institutions may be willing to negotiate payment terms or payment holidays; therefore, it will be in everyone’s best interest to contact suppliers and vendors for possible concessions. Remember, all businesses are in this crisis together and would rather negotiate than lose valuable customers.
The second strategy is to find new and creative ways to keep your business’s operations running. It reminds me of quite a few small businesses currently shifting their production or services to help with aspects of the pandemic; for instance, clothing factories that have changed production to now produce masks. The most important part is to keep offering products or services to people, while adhering to social distancing rules. This is where the creativity of the small business owner or entrepreneur will come into play in a big way. Think outside the box.
Most small business owners/entrepreneurs normally do not have the time to strategise where they want their business to go in the future. Things are normally too busy, but now might be the perfect time to do just that. Take the time and set out a strategy for your business, not only during the pandemic but also for the years to come. How can you continue to grow and adjust? And again, creativity and thinking outside the box are key here, but educating yourself is just as important. With all the online resources available, it has never been easier to access information.
Also, remember to still act ethically and treat your employees and customers well. This may not be profitable in the short term, but people will remember who they could trust during this time and who should be avoided. This will serve you well in the long run.
All of these things that I mentioned are definitely easier said than done. I get that. But resting on your laurels and sulking certainly will not help either. We as South Africans can get through this.
Dr Liezel Alsemgeest (CFP) is Acting Director and Senior Lecturer in the UFS School of Financial Planning Law.