Survival of the Fittest
Now that our political leaders have admitted that there is no answer yet on how we’re going to deal with the “new normal” because of COVID-19 (models as per the government – extension 2-4 weeks at a time and currently indicated that the May long weekend is slated for gradual opening), business managers and owners need to plan ahead. Sure, there are many federal support schemes that may provide you with short-term financial support, but in most cases, like the municipal extension of payment terms on property taxes, it will be a drop in the bucket.
Cash is king
After 40 years in business, we feel there is only one definite rule that sets survivors apart from the endless list of business failures that are coming our way. Do business owners have confidence in a return to work, or are they giving up? Do they have the confidence to take whatever cash is in their business, secure it and then fail the business, so they can start up unencumbered and without having to pay their current bills? Which unfortunately is very possible in Canada as we have witnessed many times in past economic downturns. Or do business owners have enough confidence and integrity to manage through this unforeseen and never experienced bump in the road to continued success?
Support your current clients
Our main recommendation would be that business owners pull out all the stops to assist and help their best customers. The 80/20 rule will make that very easy. Analyze who these companies and individuals are and start having conversations. Extend payment terms if you can, pause your deliverables if need be, and support them with their own operational, sales, marketing and communication needs. Set up a taskforce of suppliers, and their sales, operations and finance people and become part of clients’ inner structure and stay closer. And keep the lines of communication open.
Keeping your own workforce will pay dividends
Even though more than a million people have already been laid off in Ontario and some suspect that unemployment will skyrocket to 25% in some provinces (Alberta!), most business leaders fail to understand that employees rely on paychecks and steady futures. In our case, we’ll be looking at these proposed support programs, but as long as we have clients that need our assistance, which in turn leads to stronger future relationships, we will support our staff first and foremost to provide them with a secure way to deal with this pandemic.
For that matter, as an owner myself, I have stopped taking a paycheque so that our team members can get one. Obviously, it is a great time to ask for collaboration, and take some paid holidays, to allow staff to be with their families while this is going on. And take the pressure of the children and spouses that need a break.
Plan for the new normal
An important aspect will be what the new normal will look like. Commercial and residential real estate, car sales, restaurants and hotels, movie theatres, and many more industrial sectors will be affected permanently.
A new way of living is becoming the norm and may even stick. As business owners or managers, now is a great time to research options and be prepared. Today and tomorrow is a good time to plan, look at different scenarios, come up with a bold plan and get it ready to roll out.
Rather than believing that the status quo will come back, even NFPs and municipalities need to look at their business, operations and staffing model and may finally start looking at making it more efficient, by contracting out to third parties that have the best solutions based on sound business practices and affordable rates.
We are ready – are you?