The Paycheck Protection Program (PPP) has given small businesses across America a vital lifeline during the coronavirus pandemic. The government is granting businesses low-interest loans that they do not have to pay back if they follow certain requirements. However, the program is scheduled to end on August 8 of this year, and at the same time, the pandemic is showing no signs that it will end by then.
But there are ways to keep your business afloat after the PPP ends. Here are some of the best of them:
1. Get a Business or Personal Loan
The PPP is not the only government loan program that is available to businesses. The U.S. Small Business Administration (SBA) offers a wide variety of loan programs, both specifically in response to the coronavirus pandemic and in general. You may also be able to receive a business loan through a bank or a credit union.
If you do not qualify for a business loan, or if these loans do not provide your business with sufficient funds, you may want to consider obtaining a personal loan. With interest rates at historical lows, these types of loans have never been more affordable. What’s more, you can get a personal loan even if your credit score is only fair.
2. Negotiate Better Terms With Those You Do Business With
If your company is experiencing cash-flow problems, one of the easiest ways of addressing this is by reducing the amount of cash that is going out. The first strategy one should try to implement is renegotiating the terms of your contracts with your lessors, creditors, and suppliers. While this is not always the most pleasant of conversations to have, it is a lot more pleasant than laying off your valuable workers.
Never forget that your business is not the only one suffering right now, and that you need to take advantage of this fact. If your business goes under, it affects the economy of your suppliers. For this reason, they should be inclined to negotiate.
3. Cut Expenses
Renegotiating your contracts is just one way of improving your cash flow. Next, you should go through every recurring expense and eliminate anything that is not essential. Also, try to find less expensive alternatives to products or services your business needs.
Payroll is typically one of the biggest expenses that a business incurs. If you didn’t qualify or receive PPP funding, you can try to reduce this as well. Before layoffs, first try to reduce the hours of employees. Even just one or two hours per employee per shift can save a lot of money for a sizeable business. Depending on the law and contracts, a reduction in hours can further increase savings in terms of the benefits that you must pay.
4. Look for New Markets
Your expenses are only one side of your cash-flow equation. By increasing your revenues, you can also improve your cash flow. One of the best ways of doing this is by finding and adapting to new markets. This will require thinking outside of the box and coming up with new ways to sell your product(s) and/or service(s) to those who are not your typical customers.
Explore the possibility of expanding your business geographically. Perhaps this can include serving domestic markets that you do not currently serve as well as those overseas. The world is “getting smaller” through the implementation of new technologies. Businesses should attempt to take advantage of globalization to increase chances of success through difficult times.
5. Move Your Business Online
Another great way to increase your revenue is to move your business online. This entails far more than just setting up a basic website. Actively sell your products and/or services on your site and perhaps consider moving your entire business online. This can reduce of all sorts of expenses and allow your business to achieve a whole new level of profitability.
With an online presence, create and post useful content on a regular basis as this will help others find your site. Google bases their ranking on the user experience and quality of content. Perhaps create a blog and focus on the quality of the content you publish. With a blog and excellent content, a business can drive organic traffic to their website, hence increasing revenue. Through applying good SEO (search engine optimization) practices and focusing on aspects such as value-adding content that is relevant for users, a business can potentially be noticed by millions of people.
You do not have to let the ending of the PPP lead to the end of your business. By using one or more of the methods outlined in this article, you can keep your business running through this crisis and beyond, and even make it more prosperous.
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