How Business Owners Can Take Advantage of the Covid-19 Crisis to Create Value for Their Businesses

The adage “One person’s crisis is another’s opportunity” holds even during this unprecedented economic and health challenge. Whether your business is shut down, struggling to survive or experiencing an exceptionally high demand, it is important to focus on business basics. If you intend to run your business for years to come, taking the time now to get on top of financials will pay huge rewards. If you are looking to sell your business whether as a natural course of business or as a distressed sale due to current conditions, the better your handle on income, expenses and margins, the greater value you can reap from a business sale.

Cash Flow is King

If you are struggling during these times, predicting and managing cash flow is crucial to survival: how much do you need, how can you get it, what can you do differently to conserve/improve cash on hand. And if your business is booming, you are likely to have the same challenge: do you have money coming in to support growth—you will need to be able to cover increased inventory, staffing and training, transportation, shipping and other costs of doing business. Are your receivables coming in fast enough to cover expenses?

If you don’t have a good handle on cash flow, now is the time to get the assistance you need to see where cash is going.

Get on Top of Your Business Financials

There are an unprecedented number of government emergency assistance programs available to you right now, as well traditional SBA, bank and investment loans. While some of the loans have relaxed qualification requirements, your ability to get the assistance you need now and during recovery are going to be aided by having solid financial information in place.

• Make sure your taxes are up to date. Financial industry experts have remarked upon the surprising number of businesses who haven’t filed for 2018 yet, let along 2019.
• Make sure your accounting is current and meets accounting standards. QuickBooks and other financial programs make it easy for business owners to manage their own accounting, but they are not necessarily great at managing what goes on the Balance Sheet.
• Document costs associated with Covid-19 and the shutdown—this will help in both claims for government programs AND in valuing your business should you decide to sell it in the next two to three years.

Strategic Plan

Update or develop a strategic plan that will allow you to emerge from the shutdown in a strong position for growth.