How can you rebuild your business to profitability through these challenging times? Here are some preparatory steps you can take.
Some sectors and businesses were able to enjoy a welcome boost from the lifting of the Coronavirus lockdown over the summer, but with cases again on the rise, the landscape and guidance is constantly changing. This article covers the questions business owners should be asking themselves in order to survive and succeed in 2021.
What can businesses expect from 2021?
With varying restrictions set to continue and the end of the Brexit transition period behind us, it is still unlikely that we will return to a recognisable “business as usual” anytime soon.
Businesses will need to prepare for further changes, the continuation of social distancing and local restrictions as the year goes on.
What strategic planning should be business owners be doing?
With the above prospects in mind, what should business owners be doing to prepare? Here are some questions, the answers to which may assist:
1. The Economic environment
- What sort of business do I have left when trading recommences?
- What demand is there likely to be for my products or services in the short to medium terms?
- Should I adapt to supply other services where there is demand?
- How can my business adapt to the new economic environment and cut costs to avoid running out of funds?
- Shall I sell to the same market or explore new markets?
- Shall I go for commoditisation/mass market rather than bespoke high quality or vice versa. Either way, smart pricing will be key to success.
- Should I re-negotiate some of my supplier contracts?
- What are my competitors doing?
- What technology will help my business to survive then thrive?
- What sort of marketing is going to work in the new business world?
- Internal candidate or outsourced or both?
- What resources should I put into this and when?
- What financial resources can I call on?
- What options are there for Company and personal debts?
- What are the options for restructuring effectively with debt?
- Have I got the right structure in place, in terms of protecting my investment?
- “Can I protect company assets?” This references possible options re. restructuring to protect corporate assets.
- What business model do I need?
- Is the board effective?
- Are the shareholders committed and supportive?
- Should I think about merging or acquiring another business to give me a better chance of surviving and thriving?
- Is this a good time to acquire a particular business?
- Do I need the same or smaller premises or premises at all?
- What can I do about my current lease?
- Which employees are essential?
- What do I do with the rest?
- How easy is it to cross the legal hurdles to make staff redundant within the legal timescales?
- Can I change the contracts of high earning or long standing employees?
- How can I ensure that those retained will row in the same direction, and increase productivity for what I can afford to pay them?
- Is there any alternative to dismissals when I might need them again if there’s a “bounceback”?
8. Business partners
- What skills do I need to buy in?
- What should I pay?
- Who has the right business ethos, the motivation to assist rather than exploit, and who will go the extra mile in support of my business?
- Should I review auto-renewed contracts for HR advice, Insurance, Health and Safety?
- Do I need specialists or will the bank or my accountants or my small business advisor provide all the assistance I need?
The above is not meant to be exhaustive, but it may be a useful checklist to commence the process of preparing a strategy for survival and beyond.
Why is it important to prepare?
This preparation is more important now than it has ever been before. In my view, you will need to do a root and branch review of your business practices, and only choose business partners you can trust, preferably on recommendation and with a track record.
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