COVID 19 – Business Owners’ Advisory Service

In this time of crisis, the immediate focus is how to survive… and then, how to thrive

There’s no getting away from the fact that recent events have changed the way we live and do business. As a business owner you will be feeling a range of emotions, with your livelihood and those of many others seemingly on the line. In this time of crisis, the immediate focus is how to survive. And then, how to thrive.

This guide provides vital strategies and tactics you can implement right now and in the medium term, to ensure your business does both – survive and thrive. It’s important to create some space between the stimulus and the response. So, take ten minutes to understand the shift you have to make from what you knew, to the current environment – which is covered in the opening section of this guide. Once you’ve flipped your focus, the guide provides a useful timeline, outlining what you need to do, and when, backed up by our support to help you navigate the uncertain waters ahead. You’ve probably done some of this already, but please be reassured that there are plenty of resources available to you.

 

Create the space

In normal times, our advisory support for you is spread across a number of fundamental operating activities, primarily encompassing:

• Strategic intent or long-term view on the direction of travel
• Three-year plan
• Annual operating plan
• Half-yearly focus
• Quarterly tracking
• Monthly performance to promises, compliance and governance
• Daily action

However, these aren’t normal times, so we need to flip this and focus all of our attention on four specific key areas only, namely:

• Daily actions and outcomes
• Weekly reflection, refinement and we go again
• Monthly performance to promises, compliance and governance
• Quarterly – 90 day rolling plan

 

Timeline

In an ideal world, you would have already completed these daily actions in Week 1 of crisis management:

Day 1: You. And assess if your business is at immediate risk.
Day 2: Support
Day 3: Cash and costs
Day 4: Risk Register
Day 5: Outcomes

DAY 1: YOU

Define what support you need both business and personal. What is your work mode for the coming weeks and months? Start with you. Take care of you and yours.

Who do you need to help and support? Think about the key relationships in your business and how you can support them, what do you want them to think and how do you want them to behave in these times of crisis:

  • You – can you reduce your cost burden on the business
  • Clients
  • Suppliers
  • Your Team
  • Investors
  • Stakeholders

Create a communications plan that includes providing employees and other stakeholders with regular situation updates as well as actions taken.

Is your business at immediate risk? We can offer you access to practical and pragmatic advice so that you satisfy your duty of care and powers under Companies Act 2006 and connect you with insolvency practitioners, if appropriate.

Make some assumptions. This pandemic will have a material impact and change certain practices and thinking forever. Global experts will find a cure. We will get through this. We have recovered from other market shocks.

Set some context. This is unparalleled, we are all in this together, now is a great time to lead and work on the business.

Your team: Ensure staff can work from home and have the necessary systems and access at their disposal to do so. Create a ‘work from home’ policy and share it with the workforce.

 

DAY 2: SUPPORT

Access the support that is around you, start with the Government

Work through these support mechanisms and leverage those that are appropriate for you. This will change by the day. A package of measures to support businesses including:

a Coronavirus Job Retention Scheme
• deferring VAT and Income Tax payments
• a Statutory Sick Pay relief package for SMEs
• a 12-month business rates holiday for all retail, hospitality, leisure and nursery businesses in England
• small business grant funding of £10,000 for all business in receipt of small business rate relief or rural rate relief
• grant funding of £25,000 for retail, hospitality and leisure businesses with property with a rateable value between £15,000 and £51,000
• the Coronavirus Business Interruption Loan Scheme offering loans of up to £5 million for SMEs through the British Business Bank
• a new lending facility from the Bank of England to help support liquidity among larger firms, helping them bridge coronavirus disruption to their cash flows through loans

• the HMRC Time To Pay Scheme

 

DAY 3: CASH & COSTS

Cash is king, maintaining liquidity is key.

• Collect your cash and manage debtors closely
• Can you extend or defer payment to creditors
• See 2 above for Time to Pay, Deferment, Grant and loan options
• Assess each line of your profit and loss account; can you enjoy payment holidays, reduce or enjoy rebates on say; rent, communication and utility costs.
• Appeal to your time in line with employment law and empathy as to volunteers for reduced working hours and salaries.
• Work out weekly expenditure and make a contingency plan.
• Contact existing debt providers for support.
• Explore financial instruments e.g. discounting, factoring, supply chain loans and term loans.

We can provide access to specialists partners in costmanagement, financial experts who can model cashflow and recommend actions and funders who can provide advice.

 

DAY 4: RISK REGISTER (90-DAY ROLLING PLAN)

A Risk Register approach is a great way to stress-test your current plan or frame the needs for the contents of a plan if you do not have one? Your plan will need to flex as the pandemic impact unfolds.

  • List the risks, suggested headings could include but are not limited to; You, Team, Clients, Sales, Cash, Cost, Insurance, Proposition, Technology, Data, Funding and Markets.
  • Think about the potential outcome of each risk.
  • Define the likely impact, the likely probability and score each out of 5, multiply Impact * Probability to give a score or priority.
  • List what action you can take to mitigate the risk.
  • Define who is taking the action and when.

From this, produce a 90-day rolling plan – A contingency plan e.g. building closure plan, contract clarification, deep cleanprovider, deep clean methodology and sick pay policy.

 

DAY 5: INSURANCE

Review your policy and check with your insurance broker if you need confirmation of the type of insurance you have purchased.

It is highly unlikely that the vast majority of businesses will have any cover for losses following COVID-19. Businesses who have cover for Trade Credit Insurance will have cover for their customers who owe money for products or services and do not pay their debts or pay them later than the payment terms dictate. This could result from businesses not being able to pay for goods and services delivered as the result of Coronavirus.

Be sensible, practical and, above all, calm when managing risk and engage an expert who can help you with this.

 

WEEK 2: 

Reflect on the outcomes from week 1. Re-assess your ability to survive and structure your approach to Day 6 and each day thereafter.

• Have you improved or fully address the actions from week 1; you, support, cash and costs, plan and insurance.
• Which actions do you need to carry forward?
• Think about and deliver great Leadership (see below)
• Review the previous days outcomes and actions.
• Review the previous days COVID 19 advice and support.
• Action carried forward from week 1 e.g. COST or a new action.

Leadership

The five attributes of effective leadership in Volatile Uncertain Complex Ambiguous (VUCA) times are thus:

1. Visibility
2. Sensible, considered and pragmatic responses
3. Positivity and frequency in communications
4. Authenticity and integrity
5. Care and empathy

Being mindful of these in all your business dealings both with colleagues and employees, and with external contacts and suppliers, will ensure that you maintain a sense of calm and measured leadership throughout the duration of this crisis.

 

Next steps: Join our Covid-19 – Business Owners’ Advisory Service

To help and support you through these challenging times, we have set up a complimentary web-based advisory service with a specialist SME business adviser. These sessions are designed to be led by you, exclusively focusing on your specific issues, needs and support requirements. As well as providing access to specialists, we can cover some or all of the following topics:

1. Manage client relationships
2. Improve cash and liquidity
3. Reduce costs
4. Understand and leverage insurance
5. Winning new business in a crisis
6. Using technology
7. Access to finance
8. Operational resilience, ‘keeping the lights on’
9. Communicating effectively in crisis
10. Lead and inspire – executive coaching

This has been developed by our CEO, Martin Brown, with St. James’s Place. If you would like to book a free hour-long virtual session with one of the herd to help you manage the challenges of Covid-19 please get in touch.