Since Nimble CEO Jon Ferrara is a small business owner himself, he admires global small business specialist Brian Moran‘s passion for inspiring and educating small business owners. The knowledge that Brian has shared over his years of publishing articles in Entrepreneur magazine and the Wall Street Journal delivers amazing knowledge for this Influencer Webinar Replay Blog.
Brian Moran and his company, Small Business Edge, have helped business owners and entrepreneurs find answers to the most pressing questions and challenges that keep them awake at night. In this webinar, Brian shared how to recover your small business after a time of uncharted territory, as well as how to increase demand and prevent cash flow droughts.
As one of Brian’s small-business clients expressed to him back in May 2020: “I can’t wait till the fall when this whole thing blows over, because I’m just so tired of it.” The client had a fairly large company but ended up having to close his doors. He was expecting his problems to disappear; however, we now know things wouldn’t be that simple.
Brian’s advice to him was, “You can’t focus on September if you don’t make it past April. Stop looking ahead and focus on right now, because we’re in uncharted territory. You don’t know how many obstacles there are in front of you and the opportunities that are there.” With the right human capital and resources, you can turn an obstacle into an opportunity and pivot your business.
For example, distilleries that are known for making vodka, whiskey, and other alcoholic beverages flipped their manufacturers at the start of COVID. They started making hand sanitizers to help with the high demand, thus helping their community as well as their business.
The Stockdale Paradox
If you’re a business owner or thinking about becoming one, Brian highly recommends reading Good to Great by Jim Collins.
In the book, Collins interviewed James Stockdale, who was an admiral during the Vietnam War. Collins was fascinated with what Admiral Stockdale had gone through and asked him how he survived years as a war prisoner. Stockdale’s response became what’s called the “Stockdale paradox.”
When COVID hit and things began to fall apart, Brian talked to several business owners and asked them how they are doing. Despite not knowing what the future holds for their companies, the majority of the people he spoke with never lost faith.
That’s why they are entrepreneurs; they have unwavering confidence in themselves and are self-disciplined. Discipline is the key component of the Stockdale paradox, as well as how to survive anything — including a pandemic.
Not everybody has the discipline to do what that they need to do and assess their situation. Some business owners would wait for everything to blow over or heavily rely on others to rescue them—however, many of these businesses who wait shut down just like Brian’s client.
Reconnect with Your Ecosystem
Your ecosystem should be full of people who are going to help you achieve your business goals. These people are your customers, prospects, distributors, suppliers, associates, and other company owners. It’s important to keep a strong relationship or reconnect with them. The stronger your ecosystem is, the better your chances of overcoming the catastrophe and achieving your goals.
Who’s on your “A” list?
Your “A” list should consist of the top 20 to 25 individuals who can help you achieve your business’s success and are most responsible for it.
Brian suggests creating a list of all the people who should be on your “A” list. It shouldn’t be more than 25 people. You’re welcome to create a “B” or “C” list, but your “A” list should be filled with people who you’ll contact if your company is going through uncharted territories. They should be the most helpful in terms of navigating your way towards success.
How do you stay connected to them now?
These are five ways you can stay connected with people in your ecosystem.
- Call them
- Send them an email
- Shoot them a text message
- Send some snail mail
- Meet with them in person (or virtually)
However, the problem with emailing, calling, and texting is that people can easily ignore all five of these channels. As a result, you have no way of knowing when they will reconnect with you.
Social media is your secret weapon
The secret weapon of staying connected with your ecosystem is social media.
However, you’re missing out on valuable time and opportunities to engage with your key members in your ecosystem.
Go back to your “A” list and create four columns. On the header, write “LinkedIn”, “Facebook”, “Twitter”, and “Instagram”. Put a checkmark next to each channel that you are connected with on your “A” list as you go down the list, column by column. Some people might like to only use Instagram and Facebook for friends and family.
You should be sincere, authentic, and genuine on social media. Don’t pretend to be someone you’re not; who you are in person should be who you are online. When a client or partner discovers that you have no understanding of what you claim to be interested in online, trust and relationships are ruined. Instead, be inquisitive and ask questions.
Your social media should not be all about you when you post. Instead, follow the ⅔ or ⅓ rule: two-thirds or two out of every three actions you take on social media should be dedicated to your “A” list. Only one out of every three posts should be content that you either created or curated.
Create Mini GPS Plans
Set a clear goal for yourself of where you want to be at the end of the next three months. Then ask yourself, “how am I going to get there?” and “what steps do I need to take to get from here to the end of the month?”
To achieve your goals, you need to create a mini GPS plan for each month. Creating a mini GPS plan will give you a sense of direction and accountability when growing your business. However, keep these two methods in mind when you start developing your plan:
Most people run their businesses from the weeds because that is where they can execute. However, they can only see three to five feet ahead of them. Meaning, you are always dealing with the same issues, whether it is a problem with an employee or a customer.
Consider an employee who keeps making excuses for not being able to complete their work today. You can’t just fire an employee because you’re unaware of the ramifications. You deal with your problem employee rather than looking at it through the clouds of your business.
One of the benefits of operating from your business’s clouds is that you can see the root causes of those weed problems. Take a bird’s-eye view of your company, market, and industry, but don’t do it by yourself. Invite people up to the cloud and discuss what the next three and six months should look like for you.
These people could be your attorney, accountant, employees, or anyone else familiar with your business. When you ask these people for their opinions, you will get a fresh perspective on your company that you haven’t seen before. Furthermore, understanding what they expect of you will hold you accountable.
Maintain Positive Cash Flow!
Cash is the fuel that drives your company. There are two ways to maintain positive cash flow: offense and defense.
Your offense is receivables. If you’re in a business where you’re extending credit to people or invoicing them, you have to be pleasantly persistent. For example, if you have a net of 30 terms and it’s now net 31, call or email the people and ask where they stand. It’s important to stay on top of your receivables. You want to avoid having your net 30 turn into a net 60 or 90. If you don’t pay attention, you’ll both be out of business.
Do you have any seasonal issues or natural disasters where you live? It’s essential to note when these issues and disasters may occur because people will be unable to pay their bills when the chaos begins. One way to stay on point on these issues is by asking people to pay their bills ahead of time. For example, since June is the start of hurricane season, ask people to pay for the month of June in advance.
Your defense is your payables. Negotiate with your creditors, payables, and inventory.
Landlords did not always receive government assistance at the start of COVID. As a result, landlords decided to give a 90-day deferment because it was in their best interests; a payment was guaranteed. They would rather have you than an empty store or location.
However, if you’re having trouble paying months before, you’ll have trouble paying now. The whole mindset is that you should be proactive rather than reactive. Prepare a plan stating your current financial situation with your creditors and request that a lump sum payment be spread over ten months. Your creditors would rather take that promise to pay than having to take you to court.
Be proactive, negotiate with creditors, and flatten the curve with your financials to always maintain positive cash flow.
Play the What If Game
Ask yourself these three questions:
- What if there’s another natural disaster?
- What if your supply chain goes down?
- What if a key person in your company leaves?
These three questions are only a few of the hundreds that can be asked while playing the What-If game. Ask the people in your ecosystem what-if questions to get a 360-degree view of your business. All of the responses you received should be in a safe place for when the next tragedy strikes. The more what-if answers you receive, the better your chances of surviving are.
Disaster strikes when we least expect it, and we can never be fully prepared. However, there are many things you can do to ease your distress while the tragedy is happening. Brian Moran emphasizes the significance of identifying, communicating with, and asking questions of those who can support your business’s future. Those people could aid you through overcoming challenges and prepare you for the next disaster.