The summary of ideas below is to provide some practical ideas for you to consider or implement as appropriate, this is a moving target as the Government responds with new tools and ideas but its important to get some thinking out there ASAP so you can start to answer the many questions that you have, but also your team will have.
Current as of 15 March 2020
Planning not Reacting
Grab some post it notes/paper anything. One idea or thought per piece of paper.
List the first 5 or 10 things that you are thinking about right now, one per page.
Values led decision-making
When deciding what to do always start with your own personal values and the values of your business, how you want to be treated and therefore how you treat others should be the starting points for deciding how you respond to your staff, your customers, your suppliers, your bank, other lenders, the IRD and other Government agencies, in fact everyone you come into contact with.
Customers – Grow, Hold, Decline Strategy
When thinking about the impact on the sale side of your business there are two key phrases you need to think about:
1. Who is your customers customer
2. Are they going to grow, hold (at current levels) or decline during the Coronavirus period
List your top 10 customers or key jobs for the next three months.
Next to each one identify who their key customers are (by sector or individually if you know them)
Decide in your view if their business is going to grow, hold at current levels or decline.
Determine the overall impact for your business – will your business grow, hold or decline?
Based upon that decision, list the next 12 decisions you need to make, here is a prompt list to get you started….
Focus first on current and future sales
1. You’ve got a healthy workforce keep them busy, finish the work and opportunities in front of you and convert it to sales invoices
2. Get on the phone/email/text with your key customers, what are their requirements and how can you make sure you meet them
3. Secure supply of stock or raw materials, or increase vs reduce supply of stock, raw materials etc
4. Increase staff for growth, hold for hold, or reduce staff costs (while trying to retain them) for decline, meet with your team and brainstorm ideas
Then on short term cashflow
5. What is your current bank balance, what do people owe you (debtors), what do you owe (creditors)
6. Prepare a simple three month projection of what is coming in and what is going out
7. Get on the phone and follow up debtors, get specific on agreeing payment terms
8. Pay your creditors on time to keep the flow of money going in the SME business community
Then on where does the cash go
9. Increase funding for growth or negotiate deferred debt repayments for decline
10. Review plant and equipment purchases, are these still needed, can you defer them
11. Review upcoming tax payments, do these need to be made
12. Review drawings, turn off any unnecessary drawings to keep funds in the business