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Financing your business during COVID
- September 8, 2020
- Posted by: Shantam Khetan
- Category: Growth strategy
The year 2020 has seen a nationwide lockdown in many countries throughout the world. The pandemic has inevitably impacted millions of businesses around the world, including the prevalent e-commerce industry. Financing your business has been a temporary shutdown to the business manufacturing facilities, overstored items, divergence in consumer spending, and many due payments to the moneylenders. The gap results in a massive hole inside the economy dependent on both an individual or an organization’s commercial activities. This condition has forced the companies to shift their focus on managing their finances and reaching stable processing of goods.
Certain techniques have been studied and suggested by the financial experts throughout the world to help a business navigate through this inevitable condition.
1. Keep track of the possible financial impact on your specific firm.
: It has never been more vital for business administration to update their statements. The main benefit of doing this will be to understand the present condition of your business and the best actions that need to be taken. There are some mathematical ratios like efficiency ratio, leverage, profitability, and much more. The best method is to make notes regarding the possible business impact, the drop in customers, and the key suppliers’ issues. And the overall effect on these aspects with all the possible actions.
2. Look for alternatives to finance yourself in the short term.
There has been the emergence of money lenders and loan providers. They can offer your business with temporary financial assistance and allowance with capital. This capital might help you survive the battle and help you recover the small debts and stabilize your business with a certain amount.
3. Try to induce more capital from third-party investors and banks:
It is one of the most commonly used strategies for business owners. This involves you to create a design for the maximum growth of your business and present it to the investors to gain their support to give you financial aid. That would be best if you convinced the investors and the banking partners that you have the blueprint to get to the top of your business field. There are banking companies that provide unique benefits to the category of companies that have a history of good credit scores. Hence, if your company has been on sound financial terms in the past, it will most likely get help in this worse situation.
Related: Funding your business.
4. Stay updated with all the possible relief measures that the government has taken to support financial companies.
Not only the Union government but the state government, RBI, and also the governance at the local level have come out with schemes to support the industrial sector at their level. The government has already made an emergency and special loan offer. The private sector of banks is also preparing to introduce several support schemes. The Indian government has already announced that all the workers’ paycheck whose wages were under Rs 15k and the small sector industries. Financing your business will be handled by the relief funds. RBI has come forward with its relief measures to provide liquidity. There is a temporary stoppage of all the installments of loans and capital loans, including the dues of credit cards for upcoming months. On the International level, PayPal has come ahead with waiving off all the charge disputes for the credit card customers.
5. Financing your business Cut down the expenses:
This is quite obvious that whenever there is a financial crisis. The company needs to come forward with plans to reduce its spending. It is very much accepted that COVID-19 has affected industries all around the world since its emergence. Irrespective of the size and nature, the industries from tourism to the automotive industry all have faced tragic outcomes due to COVID-19.
And the fact that the end of this pandemic is still blurry in our vision,
the businesses cannot hold back and wait for this to pass.
Economic breakdown because of this pandemic is being compared to the ‘The Great Depression’
that shattered the world economy in the 1920s.
6. Grow the quantity and quality of your social ties
To establish and survive in this ongoing battle, you should have an excellent command of your social ties. Don’t invest all your goods or cash in one place. Shatter them to different consumers and customers. This might not stop the inflow and outflow of your money,
and the best way to do that is by aking and maintain your social ties.
REMARK- Acess to digital marketing is a must
Now is the test for the quality of a business that has distinguished the others’ success.
i.e., the ability to adapt to change, flexibility, and ingenuity.
The above techniques will help you fight this situation. And make you survive the battle and win in this challenging and sudden emergent situation of our country. Fearing is not what we entrepreneurs choose, so hold the beam of hope and survive this battle with great courage. Business comes with challenges, and each victory in a challenge gets you triumph. Keep your plans clear and work accordingly following the above technique this might make it easy for you to embrace the confidence and knowledge to run the business.