Regular readers of this blog know that I’m a huge fan of Hector Garcia and the various webinar series he’s presented through the years. He has done so much to help QuickBooks ProAdvisors and their clients, that we are all truly indebted to him.
He maintains this helpful approach by offering a free webinar about how to assist small business clients during this difficult time. Here’s the webinar — and I’ve summarized his notes and posted them below.
Summary of Hector Garcia’s COVID-19 for Small Businesses Webinar —
What small businesses need in today’s environment:
• Cash Flow
• Morale
• Purpose
• Retooling
Cash Flow
• Generate more sales – sell online, sell other things, web-based versions of your services
• New channels and forms of income – offer delivery, pre-sell future products/services, offer white-glove “touchless” alternative
• Reduction of expenses – downsize ASAP, cut unnecessary monthly services, ask vendors for “special programs” or reduce services to bare minimum, share expenses/ call friends and colleagues to share plans and services
• Delay payment of expenses – use credit card for purchases, switch to vendors that accept credit cards, ask for payment terms or extend current ones
• Cash Injection (capital or loan) – SBA loans, State-sponsored disaster/ economic relief loans
• Float Payments
Morale
• Mental health (someone to talk to – setup mastermind groups with colleagues)
• Staying in business, staying relevant, sell “something”
• Keeping talented employees (choosing which ones to let go)
• Employees not feeling like they can lose their jobs
• Ability to know that downsized employees are going to be “ok”
• Offer-up excess capacity (staff, tools, infrastructure, knowledge)
Purpose
• Businesses should have a vision/mission statement – is there a way they can still fulfill that even if the business model substantially changes?
• If they change target market, could they still fulfill their purpose?
• If they change business models and purpose, could the new purpose be as fulfilling?
• Do you have a purpose-driven brand?
• Do you have a loyal customer base that you can contact online?
Retool
• Does the business have a valuable online presence or community? If not, time to build it.
• Does the business have a contingency plan for working from home? If not, time to start preparing one.
• Is this business “social distancing” proof? If not, time to build a plan.
• Does the business have ability to sell online? If not, time to create it.
5 Key Advisory Questions
• What opportunities to fix things about your business can you take advantage of during the interruption?
• What have you learned about your business during the interruption that you didn’t know before?
• If you could have done something before the interruption what would it have been?
• As your business returns to normal what opportunities are there for you to better serve your customers?
• What is the question, that if you had the answer, would allow you to more easily recover from the interruption?
Thinking outside the box —
• Digital Tip Jars
• Gift cards, Pre-paid services, packaged discounted future services
• Reduction of services, but maintaining the customer relationship
• Delivery
• Serving the essential industries (food distribution, healthcare)
• Distilleries making sanitizer
• Restaurants (Curbside pickup, free TP/sanitizer, selling frozen food, selling “kits”)
• Farmers (drive trough fresh market)
• Babysitting for healthcare workers working overtime – https://www.mncovidsitters.org
• Drive-through confessions – https://www.deseret.com/platform/amp/faith/2020/3/23/21189502/confessions-drive-upcatholic-sacrament-faith-religion-parishioners-grace-mercy-forgiveness-covid
• Online Classes – “Zoom” version of their business – https://www.facebook.com/GuzmanDojo/?hc_location=ufi
Loans
• Check your state’s Dept of Revenue website
• County & City resources
• Check Gusto’s COVID-19 Resources spreadsheet:
https://docs.google.com/spreadsheets/d/1SRBZE2_6Nftwd02M6Oxj8MoeuZ7y93spXIgIPhkkp2w/edit#gid=0
• SBA Disaster Loan
• SBA Express Bridge Loans
Tips for Loan preparation:
• Owner’s credit will be pulled, so get a copy of the credit report (Experian, Equifax, and Transunion all offer FREE versions).
If score is under 700, have statement ready to explain areas of issues in the credit
• Use the credit report to build debt (liabilities) portion of Personal Financial statement
• Identify debt that is listed both on the individual’s (owner) personal credit and also on business balance sheet (have that narrative ready)
Beyond loan application and submitting tax returns, proactively prepare:
• Personal Financial Statements for all owners (SBA form 413)
• Business Debt Schedule SBA form 2202
• Monthly sales figures: 3 years historic, plus current year with estimate/forecast – SBA form 1368
• Have all 4506-T Forms readily signed for personal and business tax returns
• Have copies of extensions filed for 2019 returns (if extension was filed)
• Have books completed up to last month prior to loan application
• Draft a Loan narrative of what the loan proceeds will be used for, how you will be able to stay in business and keep employees on staff
• Draft Financial projections that show the post-interruption numbers supporting a profitable business that can REPAY the loan
Loan forgiveness “Paycheck protection loan” – may be passed by Congress today
Keep tight records of:
• Payroll costs (burdened)
• Rents and mortgage interest
• Utility payments
• Essential costs to maintain business operational
Comparing 8-week period from loan proceeds vs. previous year
How can accountants with multiple clients help?
• Make inventory of all your clients’ excess capacity (laid off workers, kept workers (and their skillsets), information about hours they work or are available, list of tools/infrastructure with excess capacity, unique knowledge/knowhow how team members)
• Make a database public within your client base (use Google Sheets or Airtable)
• Help them do business with each other or barter
Companies/Industries growing and hiring – if you need a job NOW…
• US Census
https://2020census.gov/en/jobs.html
• Monster.com’s top 100 Companies Hiring:
https://www.monster.com/career-advice/article/companies-hiring-now
• Amazon is hiring 100,000 new associates:
https://blog.aboutamazon.com/operations/amazon-opening-100000-new- roles
• Telecommunication software companies (Slack and Zoom)
https://jobs.lever.co/zoom
https://slack.com/careers#openings
• Grocery Stores, Pharmacies, Walmart, etc.
• Logistics and delivery companies
• Restaurants that do delivery
• 50,000+ Work from home Jobs:
https://www.indeed.com/jobs?q=work+from+home&l=Miami%2C+FL
&from=homepage_relatedQuery
• 200,000+ transportation Jobs:
https://www.indeed.com/q-Transportation-jobs.html
If this or any other posts on the website were useful to you, and your financial situation permits it, please consider contributing to my tip jar. This allows me to continue to provide free accounting resources to small businesses who do not have the funds available to hire a CPA.