There’s been plenty of media coverage about the impact that COVID is having on small business. You can’t read or listen to a news bulletin without hearing something about the Government’s stimulus packages to support business owners through this period of disruption, and there is plenty of commentary about how businesses can use this period of downtime to reassess their business operations, streamline processes and introduce new ways of conducting business.
What if you are one of the fortunate businesses to be relatively unaffected during this time? Or better still have experienced an upswing in your business due to an increased demand for your products or services? Congratulations!
If this is the case, I have some questions for you:
How are you managing with the growth in the business? Is the increase in sales filtering through to your bottom line? Are you experiencing a surge in your net cash position? Have you thought about what you might do with the additional cash in your business?
You may be able to use this surplus to assist to invest in technology or improvements within the business to create ongoing efficiencies. Do you have outstanding debt which you can pay down? Or would you like to look at extracting some of the cash to create other wealth opportunities?
Many years ago, I worked with a business owner who were managing on a day to day basis. They experienced an unexpected period of growth in sales due to a large construction project which was taking place nearby. Their business thrived during this time, and the business owners chose to invest the surplus funds in re-fitting their premises. Unfortunately, once the construction project finished sales nosedived, with the business reporting turnover figures lower than those reported prior to the construction project taking place.
The owners missed the vital signs that once the construction project finished, the foot traffic walking past their door would alter significantly. Hindsight is a wonderful thing.
Had the business owners identified this risk, they may have been able to take action to implement methods to encourage customers to detour into their store. They may also have been able to identify different customer bases and concentrated on building another element of their business.
Rather than directing funds to revamping the look and feel of the premises, they may have been better directed to marketing, or other measures to attract ongoing revenue.
Tying this back to our current circumstances. Your business may be flying right now. You may be so busy you don’t have time to stop and reflect on where your business and industry is headed. I encourage you to take the time and consider:
1. Do you have a cash surplus, and if so how may it be best utilised?
2. What changes may be happening within your industry to adapt to the COVID-19 disruption? Will these have a long term impact on your industry and business once the COVID-19 pandemic is over?
3. Are your customers looking for alternate methods to your products and services to satisfy their needs? The solution you offer may satisfy a need now, however, customers may not be satisfied with this stop-gap measure in the long term and hence looking for alternate methods to meet their demand.
Self-reflection can be the most important type of business plan. Where is your business at now? Where do you see yourselves in 3 months? In 6 months? Is this sustainable?
Above all, enjoy the ride. COVID-19 is simply another feather to stick in our cap to say we experienced, learnt from and will leave us with a story to share.