Ways for businesses to overcome the Covid-19 pandemic
As COVID-19 spread, the number of infections increased and blockade measures were introduced, causing the closure of all business sectors (except essential ones), many companies faced the battle for survival. because cash, the lifeblood of any business, evaporates overnight. Maintaining operations or operating in moderation or closing, how to manage and plan to deal with Covid-19, it is necessary to orient in advance, prepare in advance what for the time of the return of the economy ... Many questions are raised for businesses at this time, the following article shares its own views to suggest answers to those questions.
Coping with Covid-19 - The importance of cash
The first step should be to manage liquidity to make sure businesses have enough cash to get to the end of the crisis, which is to have a clear vision of what cash needs will look like and be sure. cash management to cope with the impact of Covid-19.
While the end of the Covid-19 crisis remains unclear, for now it means holding on to receivables means customers are in possession and managing inventory. , access to preferential policies of the Government, tax deferral, tax payment extension, insurance support policies and closely monitor the amount payable to creditors.
Companies also need to look at each item on their balance sheet to determine if there are assets they can sell—old inventory, for example—to generate cash.
Currently, every business must take care of their cash situation, need to speed up the collection of receivables and track past due payments, require prepayment from customers or new contract. Find ways to negotiate with suppliers, leasing to or reduce the amount of recurring payments that will make up for the commitment to pay on time or extend the payment period. Manage expenses, monthly payments that need to be paid, and arrange and cut unnecessary expenses.
Enterprises need to know in advance about cash flow in the near future based on cash flow forecasts to determine and make response decisions as well as develop appropriate goals and strategies. At the same time, in combination with actual arising, adjust the forecasts to provide an accurate view of cash flow.
Prepare a response scenario and make an implementation plan
Need to think about possible future situations and scenarios, approach support packages, covid allowance and a backup plan in all cases. Not because of the immediate difficult situation, businesses do not see optimism ahead, thereby planning in the transition period when the epidemic is gradually controlled, businesses seek to restart operations after cease operations and reduce growth momentum.
Scenario planning and countermeasures in all situations help businesses proactively react, minimize risks and losses, and maintain operational resources in the long term. By the time the blockade orders are lifted, businesses will once again need to consider how to restructure balance sheet items, as re-operation means increased costs, such as: the cost of wages, employees, workers may increase by many times, but sales volume and revenue may not be equal to previous levels, not yet recovered, while fixed costs will not change, as well as the pressure of facing due debts when the economy recovers.
Innovation and application of technology in business
Reducing salary costs, production and business costs, improving productivity, improving the quality of products and services, limiting errors... isn't that what any business wants. In the context of the Covid-19 epidemic, the pressure to cut spending, attract customers, work online, do business online, more and more companies have been looking to the applications of new technology to take advantage of the benefits. Its benefits are to serve business activities and to maintain stable cash flow.
Technology is quietly "covering" modern life. Every aspect of life is "covered" by technology, especially business. Traditional business leads to ceding market share to online business, electronic trading floor, purchase and sale applications, etc. In particular, the timely technological support of the Government for small businesses and enterprises. as a lifeline in this difficult time of dealing with Covid-19.
Covid-19 is an opportunity, a silence for businesses to look at themselves, to review the challenges and opportunities ahead. What needs to be done to continue to develop, improve new or still apply the old model. A new generation of entrepreneurs is taking shape through the pandemic, where the key to growth is mastering technology.
With the right and sufficient preparation, with a calm, understanding attitude in all planned situations, surely any business will find its own way of coping during the Covid-19 pandemic as well as the Covid-XNUMX pandemic. All confusing questions are cleared up. For any issues that need advice, please contact Vieter for detailed answers.
