India went from a “do not worry” mode to almost everything being under lockdown due to the COVID-19 pandemic in a matter of few weeks. To “flatten the curve,” many businesses have been shut down, supply chains disrupted, and transport restricted. These restrictions, combined with an uncertain global financial environment, mean that in FY 20-21, the expected growth of the Indian economy could be just 2%. This is much lower than the earlier projected 4.7%-5.2%, by the rating agency ICRA.
No matter how established a business might be, almost everyone is facing major disruptions and losses. To minimise the losses during the lockdown, businesses need to re-evaluate their plans. Here are some things you can do to minimize losses and mitigate risks during the coronavirus lockdown.
1. Keep Track of Your Expenses
During the lockdown, it is of utmost importance that every business conduct a thorough assessment of their variable and fixed expenses. They should also assess their actual revenues. This would provide a clear picture of where the company stands financially. This, in turn, would help in planning for the future. You can use online banking facilities to keep track of your expenditure.
2. Leverage Force Majeure
Force majeure is a contractual clause that alters the liabilities or obligations of a party under a contract, in case of extraordinary circumstances or events. The events or circumstances must be beyond the control of the parties involved. The event must also prevent the involved parties from completing their obligations. To leave no room for misinterpretation, the contract can also list out the events under which the contract can be used. Thus, companies can make use of words such as pandemic, disease, COVID-19, government regulations and quarantine in the contract. Force majeure can be an extremely important tool for minimizing losses during the pandemic.
3. Make Use of Net Banking
One technology that can be highly beneficial for running your business smoothly is online banking. Digital banking can be used for transferring money and paying bills without setting a foot outside the home. Another benefit of online banking is that money can be transferred almost instantly. Plus, with this type of banking, you are not bound by time restrictions. With so many benefits, it truly is the future of banking.
4. Focus on Marketing
It might seem like a reasonable idea to cut down on the marketing expenses during the lockdown. But that’s not always the case. In fact, a Harvard Business Study analyzed 4,700 businesses before and after the recession for almost 3 years. It found that the 37% of companies that adopted a focused spending strategy fared much better than the 21% businesses that adopted aggressive cost-cutting during the recession.
During the lockdown, many more people are in front of their screens than usual. This makes online marketing options, such as PPC and social media marketing, a great idea. Also, ensure that your business can be found online.
The lockdown is a difficult time for businesses. But it can be dealt with through the right marketing, leveraging technologies such as internet banking, and staying on top of your expenses.