British retailers were cautiously looking forward to the approaching, all important peak trading season. But the potential nightmare before Christmas became a reality on Halloween. Excitement turned rapidly to despair as the Prime Minister announced a second national lockdown starting today.
But it wasn’t just our existing entrepreneurs that were wondering what to do next. Despite Covid, almost 100,000 new businesses started between July and September this is up 5% on the same period last year. Clearly the original lockdown gave people the time to think about their skills, what they have to offer and the drive to give it a go.
With these new restrictions announced and businesses having to rethink their operations what are the key areas that business owners should be thinking about as we enter lockdown and throughout.
“Business owners must not bury their heads in the sand,” says Bobby Lane, CEO of Factotum. “They must take decisive action to ensure that their business can survive now and into the future.”
Factotum, the multi-disciplinary outsourcing practice, has created the 5C approach to help businesses identify the key areas of focus.
Don’t underestimate the cash that you need to get started! It’s not just about opening the doors you need to make sure there is enough cash within the business to pay the bills and keep the wheels turning once you are up and running. You can have the most profitable business in the world but if you can’t pay the bills you will not be in business for very long.
- If further cash is needed the CBILS and Bounce Back Loans have been extended until the end of January 2021 so now may be the time to apply
- If a business did not take the full Bounce Back Loan then a top up may be available.
- For businesses forced to close there will be up to £3,000 per month distributed under the local restrictions support grant
Keep your costs flexible! Outsource as many of your back office services as possible such as Accounting, Legal, HR and Marketing that way you can turn it on and off when you need it and focus on what you do best. If you need premises look at flexible space rather than tying yourself into a long term deal.
- Is there an opportunity to renegotiate with the landlord? Can an existing rent deposit be used to cover the next quarter rent? Is it possible to renegotiate a lease renewal with a rent free period?
- The furlough scheme has been extended to December, now more generous for employers with the full 80% covered by the Government and the employer having to cover pension and NI contributions
Access to the right information proved critical to businesses looking to access financial support during the early stages of the crisis. Business owners must make decisions based on accurate up to date information rather than estimates and instinct. The last few years has witnessed huge developments in systems that enable smaller businesses to forecast, manage their information, reach their customers and generally be informed as to what is going on. Now is the time to implement these systems to make sure that the management team will be managing the business and it is not the other way round.
Without your customers you don’t have a business! Focus on the customer journey and experience. If you don’t look after them they will go elsewhere. Understand their needs, identify how you are working with them and engage with them. If you are an online business you must think about how to build relationships and loyalty in creative ways.
- A review of customers should be performed to identify key characteristics to ensure that all marketing activity is focussed on the ideal client and how to engage with them
- Think creatively! With stores closed, businesses must create a digital first customer experience whether using social media, augmented reality or other means.
Internal and external communication is vital! If you have a team make sure they know what is going on. Communicating with your customers whether digitally, through more traditional means or via personal meetings (socially distanced) is vital so that they know that you are open for business and what you have planned.
- Customers need to know that a company is still open for business so two way communication is vital. Asking for feedback on what customers want may provide interesting opportunities.