No-one wanted another England-wide lockdown, especially as many UK businesses were barely back on their feet following the original March 2020 lockdown. So, what can you do to ensure your team and your business get through another lockdown?
Here are a few tips for keeping your finances ticking over, looking after your staff and customers, and ensuring your business will survive and recover ready for 2021.
8 Key Ways to Get Through Lockdown 2.0
2020 has been a huge challenge for the UK’s small businesses. This new enforced lockdown, and the resulting closures of all non-essential businesses, will have a huge impact on the business community.
However, there are ways to minimise the impact, overcome some of the major challenges and put your business in a better position as the lockdown continues.
Make use of the extended furlough scheme – the existing Coronavirus Job Retention Scheme (or the ‘furlough scheme’ as it’s more commonly known) has now been extended until March 2021.
At present, you’ll be able to claim 80% of an employee’s monthly wage costs, up to a limit of £2,500. With the business closed, and income in a slump, this furlough money will help to cover your payroll costs, preserve jobs and keep money in your team’s pockets over the course of the new lockdown.
Read our simple guide to understanding the new furlough scheme, and contact us if you need help making a claim.
Apply for Government loans while you still can – the UK Government provided considerable financial support for businesses during the first lockdown, and many of the loan schemes are still available during this second shutdown.
The Bounce Back Loan (BBL) is designed for smaller businesses and allows you to borrow up to 25% of annual turnover, interest-free, up to a limit of £50k. The BBL is now available until 31 January 2021. The Coronavirus Business Interruption Loan (CBIL) has also been extended until January, and allows you to borrow up to £5million towards the costs of getting your business through the crisis.
Get in control of cashflow – with revenues plummeting again as the business shuts down, it will be vital to get a handle on your cashflow. Key things to focus on will include cutting overheads, reducing spending and negotiating longer payment terms with your suppliers.
Take this time to check and plan your deadlines for the year. If you can hibernate and keep the business ticking over with minimal outlay, this will help to mitigate the negative impact on your cashflow position. Using budgeting, cashflow forecasting and scenario planning will also help with your decision-making.
Keep in contact with your customers – losing touch with your client base during any shutdown could have dire consequences. So, try to stay in contact with your regular, trusted customers and keep them up to date with things like changes in the business, when (and if) you’re open, and how to buy your products/services online.
Keeping your company blog or email newsletter running is a great way to preserve that essential contact with your customers and to keep your brand at the forefront of their minds.
Diversify and sell in the online space – with many bricks and mortar stores and premises shut, selling in the online space could well be a lifeline for your revenues. Look at the products and/or services you supply and think about ways to move these to an online model via eCommerce tools.
Also consider new niches or services that you could diversify into. The more revenue streams you can keep running, the better your cash position will look, and the more financially stable the company will become.
Optimise the business for remote working – a large percentage of your employees will be working from home, so it’s vital that you have an effective remote working strategy and set-up. Your team needs to be able to check work emails from home, access company and client information in the cloud, and be able to communicate with colleagues and customers.
Having a good video call set-up will be vital, so find a video platform like Zoom or Microsoft Teams and make sure your people are trained up and comfortable with holding meetings via video conferencing.
Don’t forget to claim for your home office – contact PennyBooks to find out how we can help.
Take good care of your staff – the stress, worry and de-motivation of being in lockdown can be hard on your team. If you’ve got people furloughed and stuck at home, stay in contact with them and arrange regular team meetings to boost morale and keep everyone in the loop.
If you’re operating with social distancing in place, make sure you’ve got hand sanitiser, masks and any other safety equipment that’s needed to make your team feel protected and safe. If you can afford it, pay for weekly private Covid testing too, to protect your staff and help people feel confident that they’re not passing infection around the workplace.
Care for your own mental health as a business owner – when you’re the captain of the ship, getting your business through a crisis can be an extremely stressful experience. Covid is having a real impact on owner’s mental health with 48% of UK small business owners saying that COVID-19 has had a ‘severe impact’ on their small business.
To overcome the stress and worry, it’s important to practice mindfulness, to get regular exercise, and to reach out to your business network, family and friends for support. Getting through lockdown is much easier when you don’t do it alone!
PennyBooks can help you assess your current financial position, scenario-plan potential outcomes and make the right decisions for getting your company through this second lockdown and into recovery.