I’ve been writing for Inc. for about 10 years but I began reading the magazine when I was a kid. As I think back on it, there were a couple of reasons. The first was that I wanted to learn how to become a successful entrepreneur. The second was because being an entrepreneur can be a very lonely thing. It is impossible to describe the sense of isolation that every founder experiences.
Before social media and social groups generally were a thing, I turned to the advice in the magazine to feel part of a entrepreneurial community of people who have been occasionally humiliated by a potential investor or tongue-lashed by a frequent customer or had to fire someone who was an integral part of the startup’s culture.
This context is necessary for me to explain, because I have been through a lot as an entrepreneur and have been in the place that many readers are in right now. Before I share some advice, I need to say that nobody, including me, can provide all the answers in an economic scenario like the one we are experiencing. I resent it when “gurus” like me indirectly imply that they are a source of great wisdom and knowledge. This minimizes the unavoidable struggle that each entrepreneur faces.
I am disheartened that a lot of small businesses are suffering right now and that my words will not assuage their struggle. But, as entrepreneurs, we try.
That said, here are the actions I recommend you consider over the next 90 days as you steer your business through the current Covid-19 crisis.
1. Vigorously control what you can. Vigorously ignore what you can’t control.
Unfortunately, I think this may be the most important point, but note that there are two conditions in this statement. More than ever, you’ll need to go to war on the things within your control. You cannot control the economy, but you can control customer service. You can get in line first at the bank. It took me 30 years to learn what I am trying to outline in a couple of sentences.
Also, in times of stress, it is very important to not beat yourself up about the things beyond your control. Back in 2008, I ran a software company that was impacted significantly by the financial crisis. I remember calculating that we had two months of cash reserves before we would run out of money. I have run other businesses that could not have gone two days without sales.
I don’t think most people in America (and certainly not in our Congress) understand the razor-thin margins of small businesses and, as such, the calamity of even a brief decrease in sales. The bottom line is, you need to do what you can and be tough, and you have to exercise discipline in ignoring what you cannot control. By the way, this might start with not obsessively watching the news.
2. Guard employee morale.
When you were a kid, how did it feel when Mom and Dad were arguing with each other about bills, or anything else? It’s important to be honest with employees about your financial condition, but you need to lead people in such a way that they have confidence that you are capable of turning things around.
In the companies I have run, I use radical honesty mixed with a plan that employees can buy into. Even if you only have three or four employees, you are a general of your army, so you have to have a sense of control. There is a lot of panic right now, and you don’t have the luxury to be one of the people panicking.
3. Preserve cash where you can.
I wasn’t going to include this one because it is so obvious, but I have received a lot of questions around cash flow planning that make this point necessary. Right now, your motto should be: Live to fight another day.
Now is a good time to go through your expense register and minimize excess expenses, which all businesses have. However, be cautious with people-related expenses. Many people have to let employees go, which I understand and have lived, but it is important to think in the long-term. If you have the ability to be loyal to employees, they will not forget it when you need them. (Actually, some will forget it, but ignore those people.) I realize this is not always practical for a business that is losing all its revenue.
4. Be first in line.
If you are applying for a loan or government assistance, get to the front of the line. Also, be what my mother used to call a “nudge.” Push and drive your bank appropriately, and don’t expect them to be proactive with you. Because they won’t be–they’ve got their own problems right now.
5. Get back to the basics–starting with monomaniacal customer service.
I realize this advice might come off as “Let them eat cake,” but I believe it’s important. Entrepreneurship is about competition, and you have to outwork the competition on customer service. Most of us claim to be good at customer service, but the truth is, all businesses can do better. And customer service is something you can definitely control.
6. Pivot your product or service to new conditions.
I’ve run three businesses–a landscaping business, a coin laundromat chain, and a software business. Each would be differently affected by the current virus. I was thinking about the coin laundromat the other day. How could that have pivoted?
We might have pivoted to a drop-off and delivery service during this time. A move like that would not have made up for the current economic climate, but at least we would have been bringing in some revenue and keeping some employees on board. Look for pivots you can make within your own strategy–even if they are small–to stay afloat until we have more answers.
When I was a kid, we sometimes did not have enough food. We ran out of milk a lot, and I remember the feeling of emptiness I would get in my stomach. My mom would sometimes ask me during those times if I wanted “magic milk”– milk that she would seemingly create out of thin air. Later, I realized she was going to the basement and mixing Carnation dry milk powder with water.
While I don’t have any magic milk for you, hopefully, some of these words will help out. Do what you can. Be tough. Things usually work out.