Coming Out of Quarantine & Reopening Your Business

To help slow the spread of COVID-19, many businesses were forced to shut down. This took a big toll on their finances. Some needed to lay off staff or shift to online operations to cope with the quarantine. Thankfully, restrictions are starting to ease. As a result, many businesses are now considering opening up again. This is a very exciting time, but it can also bring a lot of stress. Many people are still wary about the virus. Others are trying to limit their spending. Because of this, business owners are realizing that to reopen their business, they will need a cash injection. If this applies to you, there are some things that you can do.

Evaluate the Effect Of COVID-19 On Your Business

One of the first things that you will need to do is evaluate the effect that the shutdown has had on your business. One of the most obvious impacts will be a loss of earnings. To find this, you might want to consider how this year is shaping up to previous periods. This can be especially helpful if you have been in business for several years, as you have a long history that you can examine. Once you know your historical figures, look at your current balance sheet and profit and loss. If you are a new business, consult the earnings projections.

However, this only tells you the immediate financial impacts. To find out the true cost of the pandemic, you will need to dig a little deeper. For example, you might have had to let staff go. In this case, you might have lost valuable experience and skills, which can be difficult to quantify. It’s also possible that your company might have been losing customers to rivals. You might also notice a decline in the entire business sector.

Check the Local Regulations

While you might want to re-open, it might not be possible under local regulations. In other cases, you might need to meet certain rules. For example, some states might limit the number of people in the store or enforce strict social distancing rules. If you aren’t following the correct legislation, you risk getting a fine. To get a better idea of some of the regulations that you’ll need to follow, check out the US Chamber of Commerce guidelines for your state.

As these rules change frequently, you might want to sign up for email alerts. This will let you know when guidelines change, so you’ll be able to adjust your business accordingly. It’s also important to make sure that you have access to flexible financing. This ensures that your business will have the money needed to deal with any situation. We will discuss how you can get the money needed to reopen later.

Develop A Plan

Once you are confident that you will be able to re-open, you will need to start developing a plan. As you are doing this, consider how you are going to implement social distancing. For example, some stores might provide free hand sanitizer to customers. In other cases, you might want to keep some employees working from home, if they don’t need to physically attend the workplace. Some of these changes can be very expensive, particularly if you need to re-design your operation. As a result, you will often need to get some financing to be able to reopen.

Once you have developed a plan, you will need to make sure that you are communicating this with staff and customers. After you do this, make yourself available to answer any questions that they might have. This can be a great way to make sure that everyone understands what you expect from them. It is important to have flexibility built into the plan. As we mentioned, it is common for regulations to shift frequently. You will need to be prepared for any changes that occur.

Get Finances to Open

As we mentioned, it is common for the shutdown to have had a profound impact on your business. While reopening is a good step, you cannot expect to be doing the same numbers you were pre-lockdown. There is still a lot of uncertainty around the virus and its impact on business. It could be several weeks, or months before you fully recover. You need to be financially prepared for this.

Government Programs

The first source of funding that you might want to consider is the government. Many states have put programs in place to support small businesses and help them get through the lockdown. There are also federal programs to consider. For example, you might want to think about the Paycheck Protection Program (PPP). This can provide up to eight weeks of financial assistance, helping you pay for rent and wages. These loans are available at an interest rate of just one percent.

You might also want to consider the SBA Economic Injury Disaster Loan. This is another Federal relief program. In this case, you’ll be able to claim a loan. If you are a for-profit company, this will be charged at an interest rate of 3.8 percent, paid back over 30 years. If you are running a non-profit, you’ll get an interest rate of 2.75 percent. You might be able to get around $2 million in loans from these programs.

In other cases, you might be able to apply for loan forgiveness. This can be a great way to clear some debts. It is important to check that you are eligible to apply for these programs. It is also important to read through the requirements before you sign up. In some cases, there might be restrictions about what you can use the money for.

Bank Loan

The next source of funding that most people consider is a bank loan. However, it can be hard to access fast cash through this source. Often, the bank will have strict eligibility requirements that you need to meet. If you have not been able to make any money for the past few months, they won’t want to provide a loan.

Also, due to the increased uncertainty, some banks will want to charge a higher interest rate. This will result in you paying more over the life of the loan. Even if you do get approved, you will need to fill out a lot of paperwork, all of which will need to be looked over and approved. As a result, it can be several weeks before you can get access to the money. Because of this, bank loans tend to be a poor source of fast money and might not be appropriate for small business owners that need the money before they will be able to reopen.

Alternative Funding

If the bank says no, you don’t need to give up. You can turn to alternative business funding sources, like the South Florida Funding Group. We offer a range of ways for you to get the money you need fast. Depending on the type of loan you want, you might be able to get the money by the end of the week. This is vital when dealing with the financial uncertainty surrounding COVID-19.

There are plenty of options for you to consider, depending on what you are looking for. For example, some businesses might want to get an equipment loan, to purchase the infrastructure they need to reopen. In other cases, you might want the flexibility of a line of credit. You might also want to consider a merchant cash advance. In this case, the repayments will be taken from credit card receivables. This makes it easier to repay while offering a lot of flexibility. If you aren’t sure about which program will suit you the best, the team at South Florida Funding Group can talk you through your options.

Another benefit of alternative funding for a business is that your credit score isn’t as important. Many alternative funders understand the impact that the pandemic has had on your business. As a result, they will want to consider what your financial situation looked like before you were forced to shut down. South Florida Funding Group will offer clear guidance on the type of document you need to provide.

Conclusion

The lockdown has had a big impact on businesses. Some have needed to layoff staff. Others had to fundamentally change the way they operated, heading online. It is also possible that you might have had to shut down entirely. After weeks or months, without any income, reopening can be a very exciting time. However, the lockdown has often had a big financial impact. Often, if you are planning on reopening business after Covid-19 you’ll need to get a cash injection, to deal with all the costs.

As we saw, there is a range of options for you to explore. In many cases, though, the bank will say no. If this has happened to you, consider turning to alternative business financing. This can be a great way to get the money that you need quickly, even if you have poor credit. To find out more information about these options, get in touch with the friendly team at South Florida Funding Group today.