Small businesses are the lifeblood of a community. But because of the pandemic, many of them have forced to shut doors. Now, many entrepreneurs are facing incredible financial pressures and uncertainty. And it’s up to them to embrace the challenge of building a more reliable and more innovative business with the resilience to thrive.
Here are three strategies for entrepreneurs to stay ahead during the pandemic.
Build a sufficient cash reserve
One secret of long-standing businesses is robust cash reserves. Cash reserves can help pay your employees and suppliers during hard times like this.
Now, how big should your cash reserve be? The short answer is that your cash reserve should be sufficient enough for you to feel comfortable running your operations. Many experts advise setting aside three months’ worth of expenses, while others recommend six months. Now comes the hard part of building up the actual cash reserve. To make the process easier, let’s follow a simple way. First, determine a portion of your profits that goes directly to the cash reserve. You may want to create a separate account for your cash reserve. Build the reserve until you reach the necessary amount.
Remember to not withdraw money off of it unless you need to. If you do so, make sure to replace it as soon as possible. Doing so ensures you always have enough money in the reserve.
Increase customer satisfaction
Retaining customers, especially at this time, is paramount. Efforts must be made to keep them, like updating your business model, deferring payment, offering payment installments, among others.
Here’s a plan you can follow:
- Be empathetic and understand your customers at this moment—Schedule live conversations with your customers, actively reach out to them, and respond to their concerns with concrete steps.
- Adapt your CX strategy—Review the current customer service you’re delivering, and if some things don’t work, don’t be afraid to change them.
- Support your employees—Your employees face anxiety and uncertainty, too. You must invest in improving their well-being so that they can retain their productivity and better deliver customer service.
Adapt and pivot
The pandemic has led to unprecedented disruptions for small businesses. But businesses can survive if they’re able to adapt. Here are two ways entrepreneurs need to adapt to survive the crisis.
New employee dynamic—While it’s been long possible for people to work from home in many industries, only now are businesses are taking advantage of the possibility. For entrepreneurs, there’s significant potential in a shift towards remote work, including eliminating commute time and money spent on office rent. Can you imagine the money you can save from your office expenses? So if there’s any home business idea you can think of, now’s the time to explore it.
Online presence—If you don’t have a strong online presence, now’s the time to build one. Forbes reported that there’d been a 129 percent increase in US and Canadian e-commerce orders in April 2020. Since more people are being forced to stay at home, they’re now relying on the Internet to purchase goods and services.
The pandemic is forcing business owners to think outside the box to survive. For entrepreneurs like yourself, you must exercise your flexibility and creativity to get your business through the storm.