The economy is in the toilet. Whether or not you agree with how a growing economy reversed course so quickly or who was responsible for that reversal shouldn’t change what we all know to be true: people need help, and they need it fast. The global poverty rate is expected to grow, reversing a decade-long trend in the other direction. To reduce poverty, we need to help businesses. The more of those exist, the more employment opportunities there will be for those who find themselves out of work because of coronavirus restrictions.
So what can a business do right now — when finding new customers is the greatest problem?
First things first: it’s important for business owners to know when to throw in the towel. But throwing in the towel doesn’t necessarily mean quitting. It just means finding an alternative method of getting things done. Replace an “X” with a “Y” and you might still achieve profit by year’s end. Business bankruptcy can be a key part of this equation. The word “bankruptcy” carries a heavy stigma — but it doesn’t mean failure and it doesn’t mean the end of the world.
Business bankruptcy can become important after options like debt relief are exhausted. But it can also provide debt relief. A Chapter 7 business bankruptcy involves complete liquidation of assets in the face of uncontrollable debt. In this case your business would end. The best option for businesses that could restructure and survive is a Chapter 11 bankruptcy filing. This allows a struggling business to reorganize in such a way as to optimize debt relief and returns. It isn’t viable for every business, so find a lawyer with whom you can discuss options.
There are a number of other resources available for businesses struggling due to coronavirus. Some involve restructuring or reducing staff and expenditures, while others involve bold action like crowdfunding — which isn’t really a step all business owners are comfortable taking.
Then there are the government options: the Economic Security Act, Families First Coronavirus Response Act, and CARES were all put together to help people and businesses survive impending financial doom. There are other non-coronavirus related prescriptions that might apply to your business as well. You might be able to find a small business loans, disaster assistance loan, or an emergency payroll protection loan.
Short of that, you’ll also want to address how your business will function if it is to succeed. Try to turn disadvantages into advantages. For example, coronavirus has forced many businesses to allow employees to work from home — and for some of those businesses, this has actually increased productivity rather than reduced it. That means this could be the perfect time to reduce property-related assets that you might not need anymore.
Having trouble keeping employee retention for those who need to work at home. Maybe employee attention is the problem. You need to keep them engaged while they’re at home. They need to feel productive and like what they’re doing will actually make a difference — especially now.