How is your business recovering after Covid?
Posted on 25th September 2023
How is your business recovering in response to the pandemic’s impact?
Of course, 2020 and 2021 were extraordinary years for all businesses and the economy has been affected. Inflation is slowing down customer spending and increasing operating costs. However, latest figures show that around one in six businesses reported increased turnover in August 2023, compared with July. Almost two out of 10 say they expect turnover to increase this month and over half say things are likely to stay the same.
There’s no doubt small businesses had a lot to cope with during the pandemic. A British Business Bank study found declining revenue, increased redundancies, cashflow pressures and financial uncertainty. Employees, profits and business owners’ wellbeing were all affected. Now things are starting to look up.
Planning for business recovery
Recovery depends on good financial foundations. You can even take advantage of changes brought about by the pandemic like ecommerce and home working. There’s also continuing support and funding to help you take advantage of future economic growth as customer demand increases.
Priorities like cashflow management and access to financial support are good places to start. You can review your working patterns to see if hybrid or remote working will continue to suit your business. It’s also important to look after your own wellbeing and health.
Your business recovery checklist
1. Stabilising your business finances. While you might have been doing everything you can to survive, it’s a good time to review your cashflow. Create a forecast for the next six months and check your cash reserves. If you have received support such as business rates relief, make sure you understand your position following revaluations. While the scheme is expected to continue for another year, you’ll need to prepare for it coming to an end.
If you have business loans it’s a good idea to contact lenders about a repayment holiday. You could also discuss improved credit terms with suppliers to help your short-term cashflow. Review your expenses to see if there are any opportunities to reduce your overheads.
2. Access support schemes and grants. You can still access support schemes to help you manage your cashflow. For example, you can speak with HMRC about their Time To Pay scheme to spread out your Corporation Tax, VAT and PAYE payments.
Grants are also an option for additional funding which, in most cases, you won’t have to repay. Schemes are available from the government, local councils, charities and commercial organisations.
3. Engage with your workforce. Your employees are your greatest asset and biggest overhead. Understanding their needs will help you retain them and the important skills they provide. Be flexible about ways of working and find out how you can support people. Tell them about your plans and listen to their feedback. To fill skills gaps, look in to options such as traineeships, apprenticeships, and T-level qualifications.
4. Review your supply chain. Contact your key suppliers to find out how they are doing. If they are changing the way they do business you can review your position and look for alternatives. You might find that they will offer discounts or improved payment terms to keep your business. It’s a good time to check whether other options are available, in case you need them later.
5. Improve efficiency. Virtual working and other technology such as video conferencing and online collaboration can improve efficiency and save money. Accounting software in the cloud will put all your financial information at your fingertips, wherever you are. Your customers might prefer to use sales channels such as ecommerce and tools like chatbots.
6. Understand changing customer needs. Your business has changed since the pandemic and so have your customers’ needs. For example, where possible, they might prefer to buy from local businesses which could be an advantage for you.
Please get in touch if you would like to review how adapting to post-pandemic changes might affect your business finances.
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