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Coronavirus

Adapting Your Business Model During the Coronavirus Pandemic

Adapting Your Business Model During the Coronavirus Pandemic

Author: Clint Sporhase, Vice President, Business Banking

The coronavirus (COVID-19) is first and foremost a health crisis but in recent days it has also turned into an economic and financial crisis. From the stock market, to global trade, to local businesses, everyone is feeling its impact.

With the great effort underway to reduce the spread of the virus through social distancing measures, many small and mid-sized businesses have seen a drop in customers or have had to temporarily close their doors. The question that many businesses in America are currently asking is “how long will this go on and will my business survive?”

Given the current circumstances, one of the best things any business owner, small or large, can do is establish a pandemic business continuity plan. Having a documented plan, even if developed during an unfolding situation, can help provide guidance and discipline when it is needed most. Your business may have prepared for a natural weather disaster or a cyber-attack but it’s possible that you never considered how to respond during a health pandemic.

Stay Informed

As you plan for how your business will respond to unfolding events, first and foremost, you need to stay informed. It’s crucial that business owners stay updated on the current conditions in their community. Make sure you’re getting your news from reputable sources, like your local government and health officials, not just information found online or on social media. This will help ensure you’re getting the latest facts and are following any local ordinances.

Preparing Your Business Continuity Plan

The most important thing your business needs to plan for is how you will keep both your customers and employees safe during the current health crisis – they are your business’ biggest asset. If your business remains open, do you have social distancing measures in place, such as employees working remotely, reducing staffing or having meetings with customers via webcam or phone? Restaurants, for example, can close dining rooms but still allow for takeout orders. If your business remains open, you also need to ensure your cleaning measures meet standards. For some businesses, temporarily closing may be what’s best to ensure the safety of staff and customers.

Another key aspect of a business continuity plan is communication. Communication is key to maintaining trust with your employees and customers. Tell customers what measures you’re taking to protect them and how your operations are changing. You should also regularly provide updates to employees and be open and honest with them about the state of the business. It’s also key to maintain close contact with your suppliers and vendors, given that many supply chains are under strain due to the pandemic. Additionally, have open and honest communication with your financial institution so they can help you address potential problems or connect you with information and resources.

It’s never too late to put your continuity plan together because having something documented can help you before, during and after a crisis. If you’re looking for additional support in creating a business continuity plan, Facebook recently launched a Business Resource Hub, which includes an easy-to-use quick action guide and resiliency toolkit. The Balance Small Business also provides simple and straightforward guidance on how to create a business continuity plan that will help your business plan for a variety of unforeseen disruptions.

Adapting Your Business Model

To survive the storm, it’s likely that many businesses will need to adapt their business models. For example, if your business has a store but also has an online presence, encourage customers to shop online. You could even offer special discounts to customers who use your online store. If you’re in the food service industry, now may be the time to start doing takeout orders or even delivery to people’s homes. Gyms can even offer exercise classes online instead of group fitness classes. By getting creative, you may be able to still provide your service to customers and keep your business afloat.

It also helps to adapt to the mindset of a seasonal business owner. Seasonal businesses, who are already accustomed to ebbs and flows, plan for changes in cash flow, seasonal staffing and bringing customers back to the business once operations return to normal.

Learning from Other Nations

Because other countries were hit with the coronavirus before the U.S., we can learn from how businesses in other nations have handled it. For example, in China, some of the businesses that recovered the fastest proactively looked ahead to anticipate changing circumstances. Master Kong, a leading instant noodle and beverage producer, reprioritized efforts daily, and shifted its focus away from large retail channels to e-commerce and smaller stores. To avoid layoffs, some Chinese companies reallocated their staff to different activities. Restaurants, for example, who were unable to remain open reallocated staff to projects like recovery planning or even loaned them to other companies who needed extra support.

Standing Strong Together

In unprecedented times, it’s important that the business community rallies together in support of one another. At FNBO, we have a community mindset and as the coronavirus continues to impact us in new and significant ways, we want you to know we share your concerns. We encourage you to follow how FNBO is responding on our website.

About the Author: Clint Sporhase leads FNBO’s efforts to serve small business owners. Clint has 25 years of sales, marketing and strategy experience.