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As restrictions have started to ease and business returns to some semblance of normal, organizations are left picking up the pieces of a disaster that almost none of them planned for. Let’s look at some of the statistics that explain where small businesses are at this time, and some tips on how to get your business back being the productive company you remember.
To start, let’s look at how COVID-19 affected small businesses. Nearly half (45%) of businesses were temporarily closed due to COVID-19. Those that have reopened have seen a nearly 40 percent decline in employment. Some parts of the country, including New York, California, Washington and some of the mid-Atlantic states have had over 55 percent of small businesses close during the pandemic. Additionally, over 30 million people have applied for state-run unemployment insurance.
Small businesses tend not to have the borrowing power or extra capital to endure situations where incoming revenue is limited or stymied completely. In fact, the average small business had less than two months of available capital to deal with disasters. Some businesses, especially ones with monthly expenses that come in over $10,000, didn’t have weeks of available capital on hand. Without the ability to get an influx of capital, some of these businesses were forced to suspend operations and cling tightly to the notion that they would be able to reopen after this situation had run its course. In fact, the businesses that are most strapped for cash closed their doors; and, with no timeline set for a vaccine, some businesses simply cut their losses and closed.
Lastly, over a third of businesses think that they won’t be able to open their businesses before the middle or end of August. Many businesses have already opened their doors with limitations, and some are already functioning as they typically would be. This suggests that there are no static answers to questions surrounding your business’ ability to do business, making it difficult for decision makers at these organizations to plan.
When all facts are considered, this situation is one that is extremely complex and evolves rapidly. Here are a few suggestions on how to approach the near future as a business owner or decision maker at a small business:
This situation has given business owners a lot to manage, but at KT Connections, we are here to help you get back in action quickly. Call our knowledgeable consultants at 605-341-3873 today to see how we can help you manage this situation proficiently.