- Posted by admin
- On April 10, 2020
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By now, many businesses – both large and small – have felt the economic impact of the Coronavirus pandemic. Whether it’s forced layoffs or furloughs, lost clients, lack of cash flow, or other hardships, businesses everywhere are being impacted by COVID-19 and the resulting social distancing that has closed many doors.
Small businesses are especially vulnerable to the negative effects of Coronavirus and the economic fallout. Without a proper response now, many small businesses may be unable to recover. Use these resources to help your small business stay afloat through the current health crisis and beyond.
Apply for SBA Disaster Loans
The recently passed congressional CARES act provides an extra $349 billion in Small Business Association loans for businesses negatively affected by Coronavirus. These loans are being provided on a first come, first serve basis, and the application went live this week for the Paycheck Protection Program. If your business is applicable and you haven’t applied for an SBA loan yet, it is vital to apply as soon as possible.
Who Qualifies for Coronavirus SBA Loans?
Any small business that has faced economic hardship due to the Coronavirus outbreak may qualify for an SBA Disaster loan. A small business is typically one with fewer than 500 employees.
There are four different SBA loans that you may apply for relating to Coronavirus – the standard EIDL (Economic Injury Disaster Loan), the new Paycheck Protection Program loan, an Express Bridge Loan, or SBA Debt Relief Loan.
The Paycheck Protection Program allows SBA loans to be forgiven if the small business uses the loan to keep all employees on payroll for eight weeks. For small businesses that can still operate remotely but can’t afford to pay employees, this program is a great solution to keep your business running and get your loan forgiven in the future.
The PPP loan has also extended eligibility to include independently owned franchises, self-employed workers, gig workers, independent contractors, and sole proprietors.
You can apply for both an EIDL and PPP loan, as long as you follow certain rules, such as not using the funds from both loans for the same cost. Businesses should explore whether one loan is a better fit than the other before applying to either. This comparison table from Investopedia is helpful to learn the basics of each:
How To Apply for a Paycheck Protection Loan
To apply for the Paycheck Protection Program Loan, fill out this form. For self employed or contractors, a different application is set to launch on April 10th, 2020. The deadline to apply is June 30th, 2020, but funds are being given out first come, first serve, so the sooner the better.
How To Apply for an SBA EIDL Loan
To apply for the SBA disaster loan for coronavirus, use this application.
Explore Other Small Business Resources
There are other loans and grants that may be available to your business if you search. Certain cities and states are setting up their own loan programs. Private companies are offering grants and loans to small businesses. Facebook is offering $100 million in grants to small businesses. Hello Alice is offering $10,000 grants to small businesses. Duke University’s CASE Center has created an app with regular updates on relief programs for small businesses.
Do some research to see what other options may be available to help your business.
Establish Remote Work (If Possible)
If your business can operate with employees working remotely, offer this option to your employees. Many businesses do not have the ability to function remotely, and may have to temporarily close all operations. For those who offer services that can be managed online and from home, try to keep business running as normally as possible during this time. Set up remote work guidelines and expectations and convey them clearly with employees and customers or clients.
Look Closely at Your Budget
If you’re tight on money for your business, go through your budget as closely as possible to identify where you can save. Maybe it’s tools that you’re still paying for but not using, travel expenses that can be cut, or any other non-essential cost during this time. Trim the budget as much as you can – even if only temporarily – to survive the economic fallout of Coronavirus.
While many of us are probably tired of the seemingly endless emails from companies stating their COVID-19 response, it is important to communicate clearly with both staff and customers what your business is doing at this time. Be transparent with employees about where the business is at and whether or not their jobs are safe.
Communicate to clients and customers what services you are still offering or newly offering, how you’re prioritizing safety, and any other pertinent information. If your business is still operating remotely, make sure that customers understand that your business is still available and functioning.
How you handle this crisis will define your brand moving forward. Staying on top of your business’ response – and ensuring that your response is both smart for business and compassionate – will help your business survive in the long run.
Make a Plan for the Future
Many businesses are stuck in the here and now, dealing with the new daily challenges of social distancing, remote work, and other obstacles of this public health crisis. While there are certainly issues to be dealt with short-term, you should also be making a plan for your business in the long run.
The world after Coronavirus will not be the same as it was before, and it’s still unclear how everything is going to shake out. Leadership should come together to make contingency plans based on how long this outbreak may last, as well as a plan to reboot when adjusting to the landscape post-Coronavirus. Consider what your business will need to do to get back on its feet, what will change about your business long-term, and what will change about the world surrounding your business.
The state of the world is undeniably stressful right now, but with thoughtfulness and proper planning, your business can survive COVID-19 and all its challenges.