5 Tips to keep your design firm afloat during the Corona Pandemic
I have successfully run my design business since 1993. While it is always challenging, this has been amplified with the advent of the Coronavirus pandemic. I wanted to give you some tips to help you keep your business in the black as we navigate this new reality.
Here are five things you need to do right now:
1. You can still apply for an SBA Loan. Many of you may have registered for the EIDL or PPP plans but the SBA has other low loans available that are not tied to the CARES act. The good news is that funds are still available. Also, the SBA sees that many small business owners want to close or retire so it is a great time for someone with some cash and who can afford a loan, to take advantage of this little-known program to acquire an established business and breathe new life into it! Because these loans are issued directly by the SBA, approval times are significantly less and the red tape is significantly lower. Get money from your City or State. Apply for a loan or grant program. Especially now, you can apply for a disaster loan or grant from your city or state if it is available. Check out your state’s website to see what’s available for you.
2. Have a discussion with both your CPA and your banker. Fortunately, the IRS has moved tax return filing deadlines to give us some breathing room. If you have not already done so, I might suggest that you adjust your estimated taxes for this year due to reduced income incurred due to COVID-19. Experts are also suggesting that you file taxes early for 2020 if you anticipate a refund. Also, if you are paying your employees during the time you are closed for business, get familiar with the tax credits you are entitled to.
Communicate with your banker.
Even if you are with a large bank, you need to establish a personal relationship with your banker and I suggest reaching out every quarter. With our current situation, many are still working remotely. I am a private client at my bank and they had actually reached out to me! This is a great time to look at the landscape of your business; confirm your available lines of credit; inquire about special loans or financing now available to you during this pandemic. Many larger banks are already doing this, and it’s likely that your bank will work out new payback programs to defer cash outlays for the short term.
3. Align with your major vendors/suppliers. While smaller suppliers and showrooms are likely in the same boat as you are during this crisis, your larger vendors have the bandwidth to ride out this pandemic and many of them are open to helping so leverage your relationships with them. I suggest calling, not emailing or texting, and ask about their terms during the crisis. What are lead times, what is in stock, would they be willing to offer you extended payment terms to help you manage your cash flow challenges over the next few months. They value the relationship you have built over the years and know that things will get better. Many will be open to working with you.
4. Constant Communication is key. Keep the conversation going with your team, even if you had to furlough some or all of our team members. They want to know how you are doing, what you are projecting, and most importantly that you care about them and their well-being.
5. Use newly discovered pockets of time for Business Development. Learn a new software program, create a new presentation, reach out to your clients, call upon prospects that have been on hold or have not yet signed your Letter of Agreement. Clean up your inbox and get caught up on your CEU requirements by attending some IDCEC or AIA webinars. You may also want to amp up your wellness rituals. From exercise to meditation, this is a critical time for self-care.
Remember, we will get through this and yes, our business and our lives will be different but we are design creatives and we will rise to the challenge and come out of this stronger and better prepared for the world that awaits us – ready to serve our clients and enhance the way they work, play, heal, learn, and live.