Restarting Your Business as the Economy Reopens

Now slowly in some states and more quickly in others, most business are beginning to reopen. The degree of the recovery will be uneven by state, by business sector and by individual company. So what is one to do? First of all, if you received an SBA loan with spending requirements primarily tied to maintaining internal payroll, or else those funds will need to be returned at least in part to the SBA. Use those funds for that purpose, but use them wisely and make sure you understand the SBA parameters. This can be a tactical decision just to retain the cash, or a great strategic opportunity given monies you did not have before to move into areas you could not penetrate previously. But we are living in a fragile world with the Covid-19 pandemic still alive, record unemployment, social unrest a new variable and who knows what a presidential election will wrought. 

 

First come the tactical options:

  1. If your staff, including temporarily employees, has held fairly constant, you need to just fill out and submit the required paper work and your OK. 
  2. If your payroll has gone done modestly, say 10-20%, use the SBA funds for added staff incentives and perks to further incentify your team to garner more business. You may even take business outside of your core competency, or at a low margin just to retain the SBA funds. Any temps you put on your payroll will help satisfy the SBA conditions. 
  3. You can add more staff to bring in more accounts in your core competency. If they do not work out after the government mandated period, you can release them and avoid the SBA repayment

 

Now come the strategic opportunities.

  1. You may have wanted to move into a new business niche, but the timing was not right or the 

       funds were not there. With many quality people now unemployed, you have a golden opportunity 

       to expand into the markets that were difficult to before. But having a sound business plan with a 

       detailed marketing and game plan, targeted clients, performance standards, vetted new hires, 

       metrics and a tracking system, etc. are essential to do this right. Again if you have made a 

       miscalculation as to what you wanted to accomplish, you can write this venture off with SBA

       funds. Many of our clients are doing that right now and hiring quality people for markets we

       wanted to penetrate but we could not previously attempt due to funds and available personnel.

 

If you do not take advantage of any of these options you will have missed a golden opportunity.

 

    

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