It may be a long time before we fully understand the pandemic’s impact on the small business community. We do know for sure the current economic climate means that small businesses need to be on alert in the event of another wave of the virus.
But take heart – there are things small businesses can be doing right now that can bolster your chances of weathering the economic storms we’re facing. So we urge you to consider implementing the following into your small business to stay afloat and potentially thrive in the coming months.
Advanced Business Contingency Planning is Key
Your business may be doing well, even thriving right now. Good for you! That means now is the time to make contingency plans for when/if the economy zaps your cash flow or dries up your client pipeline.
We recommend you take stock of the types of business transactions you can live without in the short term. Here are some things you may want to take a look at:
Re-evaluate your need for physical office space.
If you are a small business serving B2B customers and you and your staff have been working from home since March 2020, you may have realized that you don’t necessarily need as large of a physical office space as you have now. Take a look at your current lease, and see if you have options to downsize or potentially re-negotiate space when your lease is up for renewal.
You might also see if your landlord is willing to delay your lease payment for a period of time – say, two to three months. This might be the grace period you need to either catch up on sales or secure other funding to be better equipped to pay your lease.
Be transparent with your employees and seek their input.
Employees are worried about their jobs during this time. They’ve got families to care for, mortgages to pay, mouths to feed. Be candid with them about the financial state of the organization, and enlist their aid in brainstorming ways to create cost-savings in their departments.
Additionally, now is the time to show that you care about their well-being and find ways to celebrate successes and accomplishments in a non-monetary way. A paid day off, a framed award certificate, and/or frequent staff get-togethers (via Zoom) where high-performing members are praised in front of their peers are just a few ideas. Go the extra mile to ensure your frazzled employees are cared for and kept informed during this time.
Figure out how your customers’ businesses have changed, and respond accordingly.
Perhaps your client base is now selling their own products and services differently as a result of the pandemic. How can you adapt your offerings to complement the changes your clients have to make?
Spending time brainstorming with your sales team on new, more creative rate cards, new offerings, and increased marketing to your prospects should all be on the table.
Worried about becoming cash strapped? Secure a business line of credit now!
You don’t want to wait until your cash reserves are dangerously low before acting on getting a business line of credit that can help you through rough waters. We don’t know how long the virus will impact our economy, and worries about not being able to qualify for financial assistance are rampant.
One of the benefits of doing business with a community bank like NobleBank & Trust is that our business lines of credit and loan offerings are approved at a local level, as opposed to larger banks making approvals from a corporate office in a different market. Community banks have a better feel for the local economy. Additionally, they are better equipped to help their small business clients more appropriately during times of crisis.
In addition, if you already have a banking relationship with NobleBank, you have a dedicated banker that likely already knows all about your business and can make personal recommendations for how large or small your business line of credit needs to be so that you have the cash reserves if things go south for your business.
Benefits of Securing a Business Line of Credit
The benefit of a business line of credit, as opposed to a loan, is that you pay nothing at all if you aren’t using the funds – you only pay interest on the part of the line of credit you actually use. You simply have money in your “hip pocket” in case you need it quickly.
Moreover, community banks tend to have more competitive rates. For long-term or seasonal lines of credit, you can be sure you’re getting the best possible deal.
Business lines of credit provide excellent flexibility and peace of mind. In addition, business lines of credit are considered “revolving” – which means there’s no need to reapply once you’ve been approved.
Finally, once you’ve been approved, you get access to your funds immediately. A business line of credit is the most flexible option you’ll have in securing a nest egg for potential rough waters ahead.
Lean on your business banker at NobleBank to stem cash flow issues today.
Our slogan: Friendly. Proactive. Professional. Community banks are the heart of our business community in North Alabama, and NobleBank & Trust puts a personalized touch on the life of our relationships with our small business partners. See if your “large bank” relationship can say that!
Throughout Central Alabama, NobleBank & Trust is servicing small businesses with deep relationships you won’t find at the big banks. Click here to see a location throughout Central Alabama near you, or give us a call for a consultation that addresses your unique business needs at 256-741-1800.