With each new year, small business owners plan and look ahead at what the coming months will bring. It’s no secret that 2020 has brought hardships and unexpected surprises that could never have been forecasted. Customer sales have dropped off, events have been halted and businesses everywhere have done everything they can to get creative so they can keep stay up and running. If you have been struggling to manage your finances during the pandemic slowdown, here are some useful must-knows that can bring a bit of light to a dark time.
#1: Start trimming.
Cutting expenses so your business can weather the storm is key. Shaun Kelley, business banking relationship manager for Zions Bank, offered some helpful advice by sharing, “Start by examining expenses to determine if they’re absolutely necessary. Consider trimming discretionary spending, negotiating better prices with vendors, and eliminating or reducing business travel. In addition, it is important to have emergency savings or a line of credit in place to manage through cash flow disruptions. Use the same rule of thumb as households for maintaining emergency savings: three to six months’ worth of expenses in the bank.”
#2: Weigh money versus customer trust.
In the event industry, offering full refunds during the pandemic may prove financially difficult. For this reason, many organizations and event planners are weighing the benefits of full refunds versus rescheduling or rolling over registration. When discussing options with customers or event attendees, be upfront and transparent about your situation. This helps build trust with your customer base and gives them a glimpse into how critical sales are in sustaining your business.
“Many attendees have chosen to roll over their registration to help support the business during the downturn,” Kelley said. “Limiting refunds might help you through a challenging economic time in the short-term, but if you lose goodwill and trust from customers, your long-term recovery could be more difficult.”
Erin Anderson, executive director of the Idaho Botanical Garden, shared that the organization is offering several options for those affected by event cancellations, postponements, or moving programming to an online format. Their goal: to continue to gain the community’s support.
“Our supporters have options to donate canceled event tickets and program fees to support Idaho Botanical Garden in this challenging time, apply event ticket and program fees purchase towards a Garden membership, or they may request a refund,” she said. “In the coming weeks, we will be launching a membership drive. If we can gain the support of our community through purchasing memberships, we will be able to keep our Garden gates open and offer the same great programming, events, even with lower numbers of participants and visitors.”
#3: Get innovative with your business model.
As the pandemic swept through the world, almost overnight businesses were forced to reevaluate their business model and start thinking outside of the box. Weathering a storm of this size requires being flexible and fluid, adapting to the challenges that may be thrown at you week after week. So, while traditional events are not happening, think about what creative things you can do to bring in revenue. Is there a new market you could explore or a niche your business could fill in the meantime?
Businesses everywhere are facing similar challenges and because of that, collaboration is important. Whether it’s networking with other event planners in the area or talking to your local banker for advice or an in-depth look at your financial situation, reaching out for assistance and input will help you find ways to not just survive, but thrive.