ST. LOUIS — St. Louis small businesses are facing an unprecedented period of uncertainty due to economic conditions caused by the coronavirus. With an unpredictable revenue stream and workforce questions, small business executives are looking for answers.
And businesses need to act fast. Many small businesses only have enough resources on hand to last 45 days or less, said Gwendy Brown, vice president of research and policy at Opportunity Fund, which lends to entrepreneurs.
“Small business owners are much less financially prepared than most households,” Brown said.
According to Greg Pfueffer, a business adviser at St. Louis-based advisory firm Mueller Prost, the biggest challenges stem from the supply chain and how adverse effects could hit Main Streets around the U.S.
“Many executives are worried that when the supply chain gets impacted, they are not going to be able to make the purchases that make the product, which impacts the workforce,” he said. “They want to know how to manage that.”
Pfeuffer, who has been with Mueller Prost for 23 years, recommends businesses develop several strategic plans for different time frames with unique sales projections.
He said to have a plan A, B and C, and project cash flow for each scenario. Along with those forecasts, they should include variables that are specific to their business. For example, Pfeuffer said, what does your company look like 90 days from now with only 75% of the sales budgeted? From there, executives can plan their next move.
Then, look for ways to manage expenses and cash flow, he said. That could mean stretching out schedules with vendors, cutting back on overtime costs, delaying capital improvements or reducing schedules by a few hours.
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