As of December 27th, 2020 the Paycheck Protection Program is back, and Biz2Credit can get your business started with an easy process to help you get funded quickly.
Since March, small businesses have had to adapt to facing new challenges caused coronavirus (COVID-19) pandemic in addition to pre-existing challenges that every company must face to survive. Small businesses in the United States and across the globe have followed government issues in the midst of this pandemic. Local businesses have had to shut their doors for a period of time, apply new social distancing methods, and adapting to work from home orders until further notice. COVID-19’s challenges magnify pre-existing business challenges with competition, supply chains, etc. Nevertheless, small businesses have remained resilient and have taken these challenges head on despite decreased demand. This article will address five major challenges and how companies can identify, overcome, and adapt to these challenges during the COVID crisis. Understanding and identifying these challenges will allow companies to reflect and adapt to the situation.
Identifying these challenges early on will allow owners and managers to reformulate and strategize business operations. These are not cure all solutions but recognizing and anticipating new challenges is half the battle as we move further along. The five largest challenges facing small businesses today revolve around five themes: money management, client dependence, work-life balance and fatigue, switching to online platforms, and government regulations pertaining to the pandemic. Small business owners must be able to identify and address these challenges in order to persevere.
Challenge 1: Money Management:
This is the most common problem and biggest challenge for any small business is money management. Whether the business is starting up, going through a growth spurt, or in decline, the question is do I have enough to pay the bills or enough for future. Making sure to have enough cash flow to pay the bills is so vital and a constant challenge for owners and managers in determining the company’s needs presently and for future growth. COVID-19 has magnified that challenge further as many of us have closed our doors for business. Balancing the budget and being able to pay the bills have resulted from either decreasing cost of operations or promoting and relying on alternative ways for revenue
Due to the pandemic, some businesses have had to decrease the number of employees through layoffs, furloughs or changing the hours of operations. These business changes will have an immediate impact on the business’ operations as it is trying to compensate with less employees. In addition, local economies suffer from this as well.
The Small Business Administration (SBA) has helped provided assistance to help businesses. The federal government implemented the Paycheck Program Act, established by the CARES Act, provided small business loans with funds to keep up with payroll and operational expenses. However, this program has been on pause since August 8 due to the lack of funds. To find more information, it is important to visit their website, www.sba.gov. The next steps in Congress will need to provide additional funds in order to support these programs further.
Challenge 2: Client Dependence
Similar to money management, understanding your base clientele addresses a lot of what the business goals are and should be moving forward. Whether you are a top-tier restaurant, a sports facility, or any other small business, understanding your client base is so vital and will be able to help expand toward other areas. Being dependent on one demographic can have consequences toward long-term growth depending on the company’s operations and what it produces. The question is what can the business do to cater to other groups while remaining loyal to its base? Like maintaining your base, do you have enough supply lines to keep production going in case one of your suppliers is out of commission? Although these are basic questions to starting a base, they are still applicable to this pandemic continues to impact various sectors and industries.
Challenge 3: Going Digital
Going digital has been a new trend for small businesses over recent months as a way to attract a larger audience. It is not a cure-all solution, but still an effective marketing strategy. It takes time and funds to build up an audience. Social media apps, newsletters, and customer subscriptions can ameliorate that establishment period while keeping customers informed on new updates.
Switching to e-commerce areas or online stores in another way to advertise their products and using social media to develop a new or extended customer base. Having a social media presence is valuable and almost a prerequisite as companies are making the switch over. It is possible to do simultaneously but it requires a lot of knowledge and strategizing. For some, this will be the company’s first experience with building up an online brand and developing a new base for customers to interact.
Challenge 4: Establishing a Work from Home – Life Balance
The United States and countries across the world implemented a work from home strategy. Working remotely versus working from home are similar but have different connotations and duration. The former was practiced to a certain extent as some business needs change and flow and how flexible employees can work. The latter is more of a new experience, a phenomenon that has remained long-term for the time being. It is difficult to establish such a balance as priorities have shifted because some people are at home working while taking care of personal obligations such as children, elderly, etc. For some, it is difficult to establish boundaries and priorities between business and personal obligations. Balancing these obligations as well as individual mental health levels is a constant challenge.
Everything and everyone have largely gone digital from students learning to their parents working on assignments from home. One of the challenges is establishing a healthy work-life balance despite the two environments (home and work) reside in one location, the home. For some people, it is difficult to come up with strategies to deal with the mental fatigue as some people are taking care of loved ones while working from home. Balancing the environment to what business needs are required and what you can or must do to take care of loved one’s needs is a challenge in of itself for employees and employers alike.
With fatigue and low morale as an ongoing individual for employers and employees, it is important to stay connected. Zoom, Google Hangouts, Skype, and other video chat applications have been used in order to keep the team organized and in communication with one another. The probability for individuals to feeling burnt out is being reinforced by negative attitudes, feelings of hopelessness, and uncertainty. It is important to take time off or establish a period to recharge.
Challenge 5: Stay the Course on COH2ID
The COVID-19 pandemic has brought further changes as companies and businesses have had to reorganize and create new strategies. The pandemic’s impact will continue to play a part of this new normal. The goal is to stay the course through this pandemic through following recommendations from all levels of government as well as from the Center for Disease Control (CDC) and using those requirements and even going further to protect the company from unintended consequences like business liabilities from the virus.
Government regulations and governmental assistance remain a large challenge as companies are working to stay open. New government regulations from all levels have focused on fighting the pandemic. At first, the effort was directed at flattening the curve and early social distancing. After six months, we are still in that fight as COVID cases have shown to ebb and flow over these several months domestically and abroad. Businesses have been adapting to social distancing guidelines recommended by the Center for Disease Control (CDC), following state and local regulations as well. It is essential to keep following those procedures in order to assist in flattening the curve as companies begin to start reopening in any capacity. The most difficult part of these regulations is to commit to these recommendations despite such uncertainty and as these regulations can seem to conflict with one another.
In addition to existing problems that small businesses face, the coronavirus pandemic has launched a lot of new challenges that companies are developing. Existing issues like money management during a period of decreased demand, work-life balance, client base have been exacerbated by this period of uncertainty. As you may have noticed, these challenges tend overlap one another. It is important that businesses recognize and identify these challenges early in order to strategize and reevaluate other options.
Under the federal government, the SBA has provided small business loans to companies across the country through the Paycheck Protection Plan, economic disaster loan, and other assistance programs but those funds need to be replenished as we move further and as states are reopening. As Congress is working toward putting together a new pandemic relief package, it is important to remain vigilant to these upcoming events.
Lastly, establishing a work from home-life balance and mental health exercises are so essential to the company and individual’s health and future. Personal and business obligations conflict with one another as some people have to take care of children, family members, etc. It is important to remember most to remain aware of fatigue and faltering mental health. This pandemic has provided a lot of questions about uncertainty and what the future holds causing a lot of anxiety. It is important to take the time to reevaluate and rebalance one’s self before facing burnout.