COVID-19 has taken a toll on the economy and businesses of all kinds across the country are feeling the impact. As the country begins to slowly reopen, new challenges emerge and new questions arise, but one thing continues to remain top-of-mind: cash flow. We recently sat down with cash flow expert and Entrepreneur VIP contributor, Mark Kohler, who shared 3 strategies to help navigate financial challenges during the pandemic.
Strategy 1: Find ways to quickly generate cash.
Think creatively to uncover adjacent opportunities to generate cash from your primary revenue stream. Leverage your expertise and core business competencies to find ways to generate revenue from other channels. Here are some examples:
- Software development companies have put projects on hold to offer consulting services in the short term to start generating money right away
- Art studios that closed their doors have pivoted to selling DIY art kits online extending beyond their existing client base
- Local eateries have begun selling staple pantry items, in addition to take-out and delivery options, to better serve their customers
Strategy 2: Revisit variable costs.
Don’t reduce costs indiscriminately for the sake of saving money in the short term. Some of the areas you cut could hurt your business in the weeks and months ahead.
Shipping is a prime example of a cost to reevaluate and find ways to save money. An easy way to do that is with a shipping resource like PitneyShip™ shipping software. People who ship using PitneyShip™ shipping software save 5 cents per piece of first-class mail and up to 40% on Priority Mail*. Plus, users can compare costs across carriers and avoid unnecessary surcharges like address correction fees.
Another option to consider is refinancing a piece of equipment to create an influx of cash and spread the payments over time. Perhaps you just recently purchased equipment, prior to stay- at-home orders. You paid in cash, believing your operations would more than cover the needs. Wheeler Financial, an equipment financing subsidiary of the Pitney Bowes Bank, might be able to help.
Strategy 3: Open new or re-evaluate existing credit lines.
Considering non-traditional sources of capital is critically important right now, so that you can preserve your primary credit facilities for core business operations like payroll, insurance, and rent. Ideally you can find multiple sources that complement your primary banking relationship.
There are also options available from The Pitney Bowes Bank, Inc., Member FDIC. Because of stay-at-home orders, many businesses have pivoted to selling products and services online. With that comes the need to ship and pay for postage on-the-fly. Pitney Bowes credit lines and deposit accounts facilitate postage spending, enabling our customers to ship goods, communicate with stakeholders and collect on invoices.