Despite the relentless persistence of the COVID crisis, businesses need to consider their future by creating detailed scenarios to steer themselves successfully out of the Pandemic and to better times beyond.
Government figures from the Office of National Statistics suggest that for 80% UK SMEs’ pre-COVID revenue was stable or growing. A year on and 80% of SMEs have reported declining revenue. These stark stats show the overall effect of disrupted trading. Through no fault of their own, large numbers of businesses are suffering.
Further, a quarter of SMEs have claimed business rate relief or deferred tax payments. While this has helped get through the immediate challenges, deferred bills will need to be repaid at a later date. This must be factored into the coming months. Therefore, it’s time to be proactive and to put strategies in place for the future.
We sometimes call this war-room planning. The result offers a road map out of a crisis situation. Look at the worse-case scenario, put in the numbers and calculate how long your franchise can continue on this basis? Some frank and honest questions need to be asked. Model different scenarios: what if there is another national lockdown? What if trading never returns to ‘normal’ due to the changed behaviours of customers? What if there is a mutant strain of the virus which cannot be vaccinated against and this crisis rumbles on for years…?
There may well be a situation where ‘business as usual’ will never be like it was before COVID hit. With the buy-out of so many high street clothing brands and their subsequent move online, it is very likely our shopping centres will see permanent change. It’s also unlikely that staff will go to work in large offices ‘en masse’ like they did before.
Do such changes mean that it’s time to invest in a radical strategy to redevelop your franchise and make it viable again? The good news is that with change comes opportunity.
The deadline to apply for CIBLs and Bounce Back loan schemes has currently been extended into March and these can offer the funds to make the necessary changes to future proof your franchise. There has never been so much low-cost financial support available to help you pivot your business and take a new direction in order to adjust to changed market conditions.
Inaction, refusing to adapt your model because it’s always worked, can do more damage than trying something new and failing, as failing offers the opportunity to learn from your mistakes and grow. So, carpe diem!
Investing in new services and products to reach your customers during the pandemic should be viewed as a permanent source of income. Ask yourself the question, should you resume normal business, can you still offer takeaway services, sell online live classes, subscription models for content libraries, sell home kits or divert the customer journey to work online? I guarantee you the answer will be yes!
Which poses an even more important one question… Why aren’t you doing it?
If like many, you find numbers a tricky subject then get help before it’s too late! At d&t our friendly, experienced team can help with financial scenario planning and due to our experience in many sectors of the industry, we know what’s working well (and what’s not) for other franchises. Our business advisors add value by offering insight and always have our partners’ best interests at heart as we want to see their success in the long term. Therefore, I urge everyone running a franchise to take a good long look at the numbers and plan for every eventuality. Preparing, adjusting and pivoting practices and processes now, will give you the best chance of steering out of the crisis, whatever the future holds.
For further information please visit www.team-dt.com