Even as the business community deals with ever-evolving demands on operations, including travel restrictions, disruptions to supply chains, employee absences, quarantine requirements, project suspensions, and project cancellations (not to mention the overarching health and safety concerns), thoughtful managers will proceed with an eye towards the post-Covid19 environment and how to position your company to not just recover, but to prosper in the recovery.
For most businesses, maintaining position will involve shoring up three pillars of support – Human Capital, Infrastructure, and Finances.
Your people are critical to the business’s ongoing success. It is nearly certain that dealing with Covid-19 has caused disruption to employee interactions. At best, the work environment has been disrupted, possibly with employees working remotely. At worst, you may have been forced to furlough, suspend or even terminate some employees or contractors. It is imperative that you maintain communication with these folks throughout the process so that you can turn to them when you need them. If they are still on staff, it will take a bit of practice and patience to reorient them to an in-office work environment. If they have separated from employment, it is to your advantage to maintain a positive relationship with them during the separation, if possible. As your business operations ramp back up, employees with experience in your setting, and workers in skilled, in-demand positions, will be essential to smoothly getting your business back in the game. The savvy contractor will have instituted a process of keeping workers informed, reflecting respect and compassion for their concerns during the hard times.
Following through on that process as the recovery stage approaches will assure that these folks, who are so important to your operations and success, will be ready and willing to return.
Hopefully your critical systems were maintained during any slowdown or suspension so that they can be re-mobilized as restrictions on business are lowered. Equipment, whether, rented, leased, or financed, may be critical to your business operations. Maintaining payments to equipment suppliers may be difficult during the slowdown, but continuing communication with those parties to address those issues will have smoothed the way for increased requirements for equipment, or relaxed payment conditions, during the recovery.
Similarly, as the demand for materials increases during the recovery, to the extent you have maintained ongoing relationships with your suppliers (particularly to identify and address issues in paying them), those positive relationships will be crucial to re-invigorating your business.
Every business requires money to operate. Even if you typically operated without debt pre-Covid-19, if your business’s cash flow and bottom line were adversely affected by the slowdown, you may need a capital infusion to get things running again, To the extent your operations depended on credit terms from suppliers, then dealing with them in a direct manner will be essential (see Infrastructure discussion above). To the extent your business relied on loans or credit lines from a financial institution, you may need to renegotiate terms or seek a temporary forbearance of your obligations. To the extent your business suffered operational losses due to the slowdown, small businesses in designated states and territories may be eligible for low-interest federal disaster loans (SBA Economic Injury Disaster Loans) for working capital for losses caused by the coronavirus (Covid-19). Details and application protocols are available on the SBA website (www.sba.gov).
The detrimental effects of the Covid-19 outbreak on the economy and business operations are indisputable. Businesses must, and are, undertaking efforts with the help of their advisors to deal with those pressures. Taking affirmative action now, and continuing with those actions as the crisis subsides, will allow nimble contracting businesses to not only weather the storm, but succeed in the aftermath.