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Covid-19 Business Adapt: Decision Making

21/04/2020

For all leaders, here's how you can effectively make decisions for their businesses during such unprecedented times.

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We’re all looking for a little bit of help right now, and Beverage Trade Network’s new podcast is here to help. The Covid-19 Business Adapt podcast is hosted by Sid Patel, Founder & CEO of Beverage Trade Network - and has been put in place to help out industry professionals figure out what to do now, and what to do next. A lot of us are in a confused position right now, and the Covid-19 Business Adapt podcast is there to be a support system to help battle during the business troubles we’re facing through the Covid-19 virus outbreak.

In the first episode of BTN’s Covid-19 Business Adapt podcast, Sid talks about one of the toughest challenges that business owners can face - and that is decision making.

As a business owner, one of the hardest things to do is make decisions - especially during unprecedented times like the pandemic we’re facing right now. There are always a plethora of ideas, thoughts, and operations running through our heads - and the tough part is figuring out what to work with, and what would be best for the business. What’s going to happen next? And what are you going to do next?

It’s very easy to drift off when making these decisions, and getting confused, or for some, not knowing where to start. As a business owner, when you’re making decisions - these are the factors you need to focus on.

Cost, Revenue, and Time

Measure your cost. How much are you spending on your employees right now? Can you afford to spend that much? Do you have any revenue coming in? And is it enough to hold up your costs? Or are you going to have to fire some people and slow things down?

Similarly, you need to measure the time of things.

► l How much time is it going to take for businesses to open up again?

► l When will the lockdown end?

► l When would sales start coming back to normal?

Here, you need to measure the time versus the revenue.

► l How much time are you going to need to rebuild the business?

► Have a financial sheet and see how much time you have to bring things to a solid base.

Loss predicted

Right now, we’re all in a place where there’s a high possibility that we’ll be making losses, in fact, some of us already are. But obviously, it’s not always going to be like that, and as a business owner, you’re going to be thinking of a lot of things to put in place, but before making any new decisions, you need to make sure you’re aware of the loss that might occur. For example, if you’re making a loss of let’s say $10,000 a week in April, and by August, you’ve made a few decisions which helps you break even, meaning your income and expenses would be equal, and that’s where the magic is and that’s what you need to focus on. Once you break even, you know that you’re at a point where you can start rebuilding thoroughly.

You need to predict the amount of money you will lose until you break even. This will depend on:

● The size of your business

● The kind of decisions you’re going to make

● How fast you’re going to work

● What you really want to do after things are normal

“Here the theory I’m focused on is, the more you cut, the faster the break even line will appear,” said Sid.

Let’s be honest, right now it feels like you’re starting the business all over again, but the good part is that you know your business well - and even though you might now know what’s coming next, you can definitely predict the loss that your business might incur based on your decision. All in all, before you make any decision, make sure you know the losses that will come along with it, and the time it will take you to break even.

“Try to see the amount of loss you can digest, because the more you can, the better it will be for you when the rebound comes. But, remember that you have to be practical” Sid added.

The emotional factor

We are definitely emotionally attached to our businesses, and during this time it’s very important to take that into consideration. There are going to be times where you’ll have to think with your emotions, and there are going to be times where you’ll have to think as a money maker. But that again, will depend on you, and how you are willing to take things in your hand.

● As a business owner, we are all attached to our teams in one way or another, but is right now the time to actually do that? Before making decisions, think about this, you might have to fire some of your employees. How is that making you feel? How will you handle the pressure of having less employees to do the work? Or are you more focused on the money that you’ll save.

● Another thing that also hits home to the emotional factor is where your family fits into all of this. If you’re trying to retain most of your employees, is it having an affect on your personal savings? Now that’s a chat you need to have with your partner.

● Secondly, what you need to do is think of the new ideas that you are going to add to the business. As an entrepreneur, here’s where you need to play a little bit of offence. You need to come up with new ideas, you need to know what to do next. While creating new ideas, you need to put your emotions aside and figure out what the market needs right now. Because you don’t know what’s going to happen next, and out of the 10 ideas you think up, one of them could work and start bringing in revenue, which will help you in firing less.

● You also need to be self-aware of this whole situation. This boils down to how much you can handle. Talk to yourself about this: Do you really want all this pressure to make sure that you don’t fire people and cut down cost to rebuild? Or are you at that stage where you’re happy, and you’re ready to earn let’s say $70,000 instead of $200,000 for the next three years.

Everything boils down to what you can handle. Do you have the motivation and energy to sail through this time? When you’re making your decisions, base them on what you can handle, are you ready for the firing process, are you ready for the losses?. Are you ready for all the pressure? In the end, it’s you, and you need to see if you’re ready to hustle through it.

Tune into the Covid-19 Business Adapt Podcast

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