While the short-term outlook for small businesses varies greatly by industry and economies especially for third world countries like Kenya, it’s important to consider what recovery mode will look like once the economy begins to stabilize and the effects of COVID 19 continues to subside. Having a strategy in place for after COVID-19 can help you be prepared to hit the ground running and bounce back, this could be a competitive strategy. This guide can give you some help to quickly rebuild your small business. Here’s how.
Damage Assessment on Your Small Business
The first step in developing a rebuilding plan is determining just how much your business has been affected financially.
You can start by accessing the financial damage, looking at your cash flows, statement of income and statement of financial position. You can then compare them to last year’s numbers to see how much your business may be down. It’s possible that the damage might not be as bad as you think.
Aside from the hard numbers relating to sales, profits and cash flow, consider other ways in which your business has been affected. For example, if you’ve had to fire some or all of your employees, you’ll need to factor that into your rebuilding plan because that also is a burden on your resources and productivity. If you’ve cut your advertising and marketing budget down, or some of your customers have migrated toward competitors, then those are things you’ll need to consider as you identify financial resources to help you recover.
Review Your Business Plan
Your business model may have worked perfectly before the pandemic, but coming out of it may mean you have to sweat abit more by reviewing your business plan.
Specifically, you may need to consider how your business can position itself to adjust to a new normal. For example, if you previously relied on foot traffic to a brick-and-mortar location for sales, you may need to look at an online digital expansion to accommodate the higher numbers of people who are shopping from home. A lot of clients are still looking for the efficiency and ease of buying products and services, even after the pandemic, this will be the new normal.
Remote mentoring services are available on different platforms to help people during this tough time, along with free webinars that address coronavirus-specific issues.
Doing a full SWOT analysis to analyze your strengths and weaknesses, and also Opportunities and Threats that your industry may face in the Kenyan economy after the pandemic. Analyzing how your overall industry has been affected by the coronavirus pandemic also is helpful. When looking at your competitors and the industry as a whole, pay attention to the trends and focus on finding the opportunities. Being able to find a gap or need that your business can fulfill that’s been neglected up until now could be critical to reclaiming and expanding your customer base going forward.
Finally, don’t forget to revisit your business goals to make sure they’re realistic, given the current circumstances.
Budget to Account for New Spending
Bouncing back out of the COVID-19 pandemic, you may have to spend money before you can make money.
For example, you may need to spend money on building an online digital platform to reach and serve your clients. Inventory may need to be purchased, and you might have to increase your advertising budget again to start building fresh buzz. There are marketing strategies that we have to help your small Kenyan business to grow here.
As part of your corona virus recovery, you should have a clear idea of what you need to be budgeting for and what you can cut to make the most of the revenue you do have coming in. The goal is to eliminate the monetary waste or any other wastage and get your operating budget as lean as possible so that when the chance to invest in growth comes up, you’re able to take advantage of it.
An extreme step you could take during this time is deferring paying yourself a salary or taking a pay cut. Whether this makes sense depends on how well you’re able to manage your personal financial obligations, depending on what you have in savings or from a spouse’s income if you’re married. But skipping out on paychecks in the near term could help your business to get back on its feet faster as a temporary measure.
Consider Whether You’ll Need Funding or Other Resources to Recover
The next step after reviewing and restrategizing your plans and goals for the small business to bounce back you need to consider whether you have the resources to fund the rebuilding project. Unless you had a large amount of cash on hand going into the pandemic, it’s likely that you may need some working capital to jump-start your business operations coming out of it.
When it comes to financing your small business during a COVID-19 rebuilding period, there are several options to consider. There is an obvious choice for business loans from financial institutions and credit institutions.
Funding is limited, unfortunately. It’s important to consider other sources of small business funding, including:
- Small business term loans from banks, credit unions and online lenders
- Business lines of credit
- Business credit cards
- Purchase order financing
- Equipment financing
Each option can have pros and cons. Either could be useful for funding your business in the short term.
If sales are slow or nonexistent, you might have a hard time getting approved. Alternative financing options like these also can have much higher effective annual percentage rates compared to other types of small-business loans and lines of credit.
If you’re considering financing to help rebuild, keep in mind that borrowing may be competitive, as lenders want some reassurance that loans can be repaid. Reviewing your business and personal credit scores, as well as your business and personal financials can help you gauge how likely you are to get approved for funding.
Create a Time Line for Rebuilding and Monitor Progress
You may have several things you need or want to do to recover following COVID-19 disappearing, but doing everything at once may not be realistic. What can help is having a timeline to follow that prioritizes your most important actions first.
For example, your immediate goal may be reviewing and updating your business plan according to the subsiding effects of Covid 19 or scheduling a consultation meeting with a website designer. Once you’ve done that, you can set a timeline for securing finances, then web development, restocking inventory, reopening your doors if your small business closed as a result of the pandemic and, finally online marketing and advertising.
As you take individual steps toward recovery, remember to track your progress. This is particularly important if you’ve secured capital to fund your small business because you don’t want to waste time on activities that aren’t delivering a solid return on your investment. In the initial stages of COVID-19 recovery, you may want to check in weekly to see what’s working and what’s not. Later, you can shift to reviewing your business financials monthly as things begin to stabilize.
We hope that this article will be helpful in your efforts to quickly rebuild your small business and also getting it off on the best foot. Did you know during the great depression so many millionaires were created ??! Take this opportunity too to shine and grow your business, you could be the next millionaire in Kenya.
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This is really timely… Christmas and black Friday is around the corner..