On bouncing back
Ask yourself: What’s the story I want to tell about my business at the end of this?
Running a business means being well-versed in the art of problem-solving and planning.
The COVID-19 crisis has left all of us in uncharted territory, but founders and entrepreneurs are agile and resilient. Taking steps now will help position your business to thrive in the future.
After founding my company, Schmidt’s Naturals, on the heels of a recession, I’ve learned from experience the key considerations important for maintaining momentum in an economic downturn. Here are five steps you can take to position your business to bounce back after the downturn.
The only way to come back even stronger is to spend some quality time with your budgets now.
First, make sure you have a clear, updated picture of the rate at which your business is losing money (burn rate) and the length of time you have before running out of cash (runway). Determine your immediate and most important expenses and prioritize those, then look at what can be deferred or negotiated. Don’t be afraid to negotiate or ask for help. Take time to research the myriad programs, loans, and grants that can help you fill in capital gaps.
Scratch existing 2020 forecasts and prepare for far less growth in a much tighter capital environment—but know that limitations can lead to unexpected opportunities. Now is the time to strip away the fluff and hone in on what you can do with what you have. Working under constraints is exactly what sparks creativity and innovation.
If your supply chain is under stress, you’re not alone. Research and establish back-up suppliers—a best practice in any climate. Building new relationships takes time, but don’t put it on the back burner. Your supply chain will be more stable moving forward, and working with multiple suppliers can position you to negotiate better prices.
Adjust your product roadmap to account for material shortages and changes in customer habits and preferences. No one can predict the future, but it’s a good time to assess which of your offerings might be most essential and desirable in the long term.
If a core product is something customers cut out as soon as their budgets shrink, for example, explore how you can diversify your products and price points (while honoring your brand’s values). Think about how you might expand your target market, too, and make sure it’s easy for customers to get your product across channels. If you don’t have a strong direct-to-consumer strategy in place, start making one now.
Communicate honestly about how your business has been impacted. Being transparent humanizes you and your company, and it builds trust and connection. Be sure to share your plans and goals for moving forward, too. This is your opportunity to show your business’s resilience and agility, demonstrating the ways you’re building lasting value during this time.
Think hard about what your company stands for. What are your core values, and how are you remaining steadfast to those values as you move forward? Showing humility, purpose, and intention speaks volumes.
Ask yourself if there are ways you can be better connected with your business community. How can you team up to support one another? Are there opportunities for cross-promotions, partnerships, or creative collaborations? These relationships can do more than lift your spirits; they can lead you to inspiring ideas, customer insights, and new audiences.
This is also a great time to talk with customers. Ask questions. Open up conversations on social media or surveys by email and consider how you can give back, like by offering free tutorials or how-to videos. You’ll learn a lot, and you’ll stay connected. The more you know about how to fill customers’ needs, the better positioned you’ll be.
Challenge yourself to blog, write an op-ed, or explore other ways to show thought leadership. With reductions in marketing budgets, this is a great way to keep relevant and build awareness for the future.
Your sales numbers may not be what you want them to be right now, but there are other ways to demonstrate your success, innovativeness, and resilience. If you’re raising capital or want to build confidence with shareholders, be prepared to show how you pivoted, how you prioritized or cut expenses, how you spoke to your customers, how you supported your team, and how you gave back. Investors’ eyes will be on those metrics.
Ultimately, ask yourself: What’s the story I want to tell about my business at the end of this? Will you be able to say that you adapted, expanded, grew, and came out stronger? That you were a generous community member, employer, and collaborator? Imagine the story you’ll want to tell—then take the steps to make it true.
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