Keeping Your Business Afloat: How to Avoid Bankruptcy During the Pandemic

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When the pandemic first broke out, there were businesses that, sadly, weren’t able to make it out of the ‘wilderness’; that is, closing down abruptly, running out of money to continue their business, and having to close down for good in the process.

Most owners saw it as tough times, where they weren’t able to fill a need anymore. The industries they served were also shut down effectively, and people found themselves without a job, let alone businesses. There were those who managed to rely on transferring work closer to home. They were assisted by different business and asset management software that helped them continue their operations, even when sheltering in place.

These are challenging times for small businesses to ply their trade. It might be hard, but it’s not entirely impossible. Here’s how startups can survive the pandemic.

Getting help from the government

Start-ups tend to have fewer employees than bigger ones with access to significant investment funds. If that’s the case with your business, then you can go and apply for a loan by using the Paycheck Protection Program. It’s from the government’s Coronavirus Aid, Relief, and Economic Security Act.

The purpose of this is to help your business gain funds to operate. These cover anything from rent, mortgage, interest, payroll, up to utilities. The borrowed amount is payable over an eight-week period.

If you want to avail this fund, you’ll have to ask around. There are banks that are authorized to provide such a loan to small business owners, with one of the requirements to remember being that they have fewer than 500 employees. This seems to apply to the standard small business.

Look to renegotiate different contracts

During the pandemic, you might have garnered a lot of free time. Use this to take a look at your accounts payable and see if you’ve got room for negotiation. This covers topics like extended terms on loans and restructured — possibly reduced — payments.

Not all banks may offer leeway on this, but you’ll be quite surprised how many of them are. The same goes for your suppliers. Your business is also business for them, and they’ll surely help you stay away from bankruptcy to avoid losing a customer. The same might be said for your rental situation — you can try to work with your landlord concerning rent payments.

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Check for any outstanding payments

You’ve got your debts to your debtors and accounts to pay on one hand; you have to remember that, on the other, you’ve got those who owe you money and loans you need to collect on. If you’ve got an invoice bearing the full price of finished work, you can collect an amount representing part of the service rendered to you.

Just as banks and your debtors might be willing to give you leeway into payments, you should also extend the same goodwill to those who owe you. The important thing is to take any form of liquid payment, provided that they can readily pay you.

Delegate Your Tasks to the Team

At the end of the day, even if you’re trying to keep your business afloat, you can only do so much. This is why you’ve got a team; they are there to help you in the maintenance of your business. Relegate tasks to them and avoid micro-managing them. If you’re clear with what you want them to do, you can just leave them to their tasks.

Plan your working days and remember to take a break every so often. Keep to your hours as you’ve plotted them, and factor in wellness and time for yourself. Don’t miss these — they are needed to help you keep away from stress.

Don’t Be Afraid of Change

While times may be harder and you’re forced to re-align your business processes, it’s a change that you should embrace. You should also embrace the challenge brought about by this unexpected change in doing business. COVID-19 is here to stay and you should be comfortable with that fact.

Adjust to changes by embracing new technologies and making the best out of the new normal of doing things. Adapt to the technology that you’ve discovered during the pandemic. You never know, these might be what you’ve been looking for to help your business break out.

There’s nothing wrong with changing, as long as it’s for the better. Change is necessary to keep your business afloat, even during a pandemic. If you know which changes to keep and how to adjust to the changing times, then you can be sure that your business will start to grow.

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