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How to Boost Your Business Income Post-Pandemic
So you are a business owner who wants to boost your business income post-pandemic. The COVID-19 pandemic struck in March 2020, and the world will never be the same. Since that time, Census Bureau surveys have revealed that 83.5% of businesses have suffered negative impacts, and over 100,000 enterprises in the US are expected to close their doors permanently.
Now, as surviving businesses are looking for ways to maintain their financial viability in a post-pandemic world, there is significant work to do. Companies will need to reassess and update virtually all key areas of their business plans if they aim to ensure their own sustainability.
Most business’s primary goals at this point are to rebound from the pandemic in a way that leaves them even better off than before. Of course, once the pandemic truly ends, you will operate in a vastly different business environment from the one you was familiar with prior.
Businesses that actively predict and adapt to the post-COVID-19 world will be in solid positions to cement their success.
How to Boost Your Business Income Post-Pandemic
Here are some vital steps to boost your income and secure your business’s future, post-pandemic and beyond.
Align Your Strategies
Successful companies almost always have multi-year strategic plans drawn up. With that said, considering the state of the economy after the pandemic, these strategic plans will need to be completely overhauled.
You will need to examine and contrast past and current market trends to forecast the future of your sector accurately. Ask yourself about common factors among firms in your industry that performed well during the last recession, and what your customers’ current and future needs will be. How can you address them? Are there any external threats out of your control that your industry is facing? Does your business model need updating if your enterprise is to survive?
Rethink Your Finances
Your cash flow forecast needs revision in 2021, regardless of the industry you operate in. Start with your current cash position and then forecast your expected incomes and expenses using as much concrete data as you have on hand.
Your aim should be to draw up several possible cash flow forecasts based on different future scenarios, like a minor decrease in revenue, a major decrease, and completely flat income streams.
Your next course of action will be to brainstorm solutions to these scenarios.
You could, for example, put a stop to non-essential expenditures, negotiate flexible payment terms with your suppliers, and reduce the costs of your materials and other variable expenses. You may also consider applying for a low-interest state loan to help cover vital business-related costs.
You could also think about using tax relief provisions to your advantage. The CARES Act in the USA includes multiple business tax relief laws and options, including regulations on business interest expense deductions, operating loss deductions and more. If you haven’t applied for the PPP and EIDL loans, take advantage of these offerings.
Optimizing Spending Habits is Another Way To Boost Your Business
Cutting all of your costs is not always the best move for your business during economic hardship. Instead, you need to prioritize your spending on the services and products in highest demand and those that drive the most profit for your company.
Many businesses know that roughly 80% of their sales come from just 20% of their customer base. You need to focus on retaining and servicing those essential customers during tough times. You can assess your customers’ changing needs and budgets by keeping in contact with them and adjusting as you learn.
It’s reasonable to expect some form of financial loss post-pandemic, so there is no need to fight for every small customer or minor purchase. Instead, appeal to a customer base that is well insulated from COVID-19 risk, and think about adjusting your offerings according to those in top demand at the present. You could also revise your price model to provide more affordable products and services to your customers who are suffering because of the recession.
Improve Your Working Capital Management
Your working capital management strategy should include inventory, accounts payable, and accounts receivable. A solid cash gap plan can significantly improve your cash in the bank.
You can improve your post-pandemic income in the following ways:
- Reduce your cash conversion cycle by asking for deposits and upfront payments and billing as soon as your sales information arrives. You may consider offering small discounts for earlier payments, too.
- Pay your accounts payable at a later time, as long as you have negotiated longer terms with your suppliers beforehand. Paying early provides no inherent benefits, and can leave you with an imbalanced cash flow.
- Streamline your accounts receivable process by automation your invoice generation process.
- Ensure that your appointed staff members order properly to reduce last-minute purchases. Consider using automated technology to manage your inventory ordering processes.
- Accurately and regularly count your inventory to assess and control your true costs.
- Adopt inventory management best practices to turn over inventory quicker and reduce your cash conversion cycles. The quicker you can sell your products, the sooner you can receive sales cash and start the accounts receivable aging process.
Get On Board with eCommerce
eCommerce in the US grew by a whopping 44% in 2020 alone, and it’s expected to burgeon even more as the pandemic rages on. This trend is not expected to ebb away in the post-pandemic business world. Quarantine has rapidly shut down land-based businesses, but many online businesses are thriving like never before.
Your business can boost its income and take advantage of the post-pandemic eCommerce boom by offering your products and services through a dedicated online store. This approach will reduce your operational and office overhead costs, keep your workforce safe from the Coronavirus, and assist you in staying up to date with the latest advancements and trends in the digital commercial sphere.
Boost Your Business By Facing The Future
The post-pandemic world will provide myriad challenges for businesses in every corner of the world, but defeat is not unavoidable.
You can boost your business income and ensure your enterprise’s survival after the pandemic has ended by adapting to new trends, prioritizing your cornerstone customers, optimizing your spending habits, and improving your working capital management.