The key things small business owners need to ask and act upon right now
Small business owners are likely to feel overwhelmed at the moment. But you need to act immediately, says expert John Downes. Here are five key things to ask and act upon.
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With the announcement of shutdowns across various sectors, small business owners might feel paralysed or apprehensive. But you need to act immediately.
There are five broad areas to consider and a series of questions you must ask yourself and act on:
ASSESS THE ABILITY OF YOUR BUSINESS TO SURVIVE TWO MONTHS
To start, establish whether your business can make it through the lockdown until it all returns to normal. Consider:
■ What is your cash position accessible right now?
■ What debts are immediately collectable? Any debtor who hasn’t paid within 90 days is probably uncollectable. But call every debtor under 90 days and confirm payment.
■ Your tax position — GST and Payroll PAYG — are you eligible for the $25,000 PAYG relief? Can you defer payments of GST and PAYG with the Australian Taxation Office for a few quarters and create a payment plan spread over 12 months?
■ The costs of opening the doors each month. They typically involve staff, rent and cost of goods.
■ Interest charges on bank loans. Can you defer any repayments?
■ What do you owe suppliers and creditors over the next two to three months? While we want your debtors to pay you, you need to pay your creditors, too.
■ Based on the above, how many months of operating costs do you think you have available to fund the lockdown? Government support programs might help.
WHAT WILL HAPPEN DURING THE LOCKDOWN?
Ask yourself what activity your business will perform during the lockdown.
If your business is deemed a non-essential activity, who will perform the activities during lockdown (full time, part time, on-call, etc) and who will be stood down? Furthermore, how and what will those people be paid?
As confronting and uncomfortable as this is, it is vital to know where you stand, what your decisions need to be and your moral obligations.
If staff will work from home, get them to transition immediately to reduce the rush and test it out.
Seek legal advice to understand your position.
BEGINNING THE LOCKDOWN
You need clear, open communication immediately.
All staff, on or off site, need to be contacted, but you need to establish how and by who — and what will be said.
Anticipate lots of questions, confusion and uncertainty. Stick to the facts of what you know and what you plan.
Be measured, confident, reassuring, honest, and don’t make commitments you can’t stand behind.
SUPPORT THE TEAM DURING LOCKDOWN
It’s vital for connection and mutual support to touch base with everyone at least twice per week.
This will help them feel heard, not forgotten, not isolated and it’s good to hear how their peers are coping. Plan how and who will do this, for example via group video or phone hook-ups.
BRING THE TEAM BACK TO WORK WHEN THE LOCKDOWN IS LIFTED
Finally, you will at some stage need to call the business back to work. Think about who will decide which staff and when, and what you will say to them.
I can’t emphasise enough, Communicate. Communicate. Communicate — openly, honestly and authentically.
Remember Andy Weir’s quote in The Martian: “They say no plan survives first contact with implementation.”
This is uncharted territory.
People won’t remember what you said, but they will certainly remember how you made them feel and how you behaved.
John Downes is a business mentor and chief executive of Acorro