You’ve likely heard of the importance of “saving for a rainy day,” but what does …
According to the Centers for Disease Control and Prevention (CDC), roughly 22 million school days are lost each year in the U.S. due to the common cold. This year, of course, is different. We aren’t just seeing an increase in sick days as the COVID-19 pandemic rages on; we’re seeing entire school districts close down.
And schools aren’t the only establishments experiencing mass closings. Businesses around the world are shutting their doors and losing revenue, causing a major economic recession and skyrocketing unemployment.
According to Small Business Association (SBA) estimates, more than 627,000 new businesses open each year. If you just started your own business in the past 12 months, you might consider your timing pretty unlucky. Regardless, there are steps you can take to increase your chances of success as an entrepreneur. Let’s take a look at some tips and resources for new business owners during the COVID-19 pandemic, starting with economic relief and assistance.
Economic Aid for Small Businesses
Many new businesses struggle with finances when they first start up, but if you’re opening up a new business in the midst of the COVID-19 pandemic, you’re likely facing even more challenges. Fortunately, there are resources available on the federal, state, and local government levels.
On March 27, the President signed into law the CARES Act, which established several new temporary programs and contains $376 billion in relief for small businesses and workers in the United States.
The Small Business Association announced that it will provide ‘disaster assistance loans for up to $2 million for small businesses affected by the coronavirus.’
These coronavirus relief options include:
- Paycheck Protection Program: Provides a direct incentive for small businesses to keep their workers employed. SBA will guarantee loan forgiveness if employees are kept on the payroll for eight weeks and the funds are used for payroll, utilities, rent, or mortgage interest.
- Economic Injury Disaster Loan Emergency Advance (EIDL): This loan advance of up to $10,000 — which will not need to be repaid — will provide relief to businesses that are experiencing a temporary loss of revenue.
- SBA Express Bridge Loans: This loan will allow small businesses that currently have a relationship with an SBA Express Lender to quickly access up to $25,000. It is ideal for those waiting for disbursement on an EIDL, and the loan can be repaid by funds from the EIDL.
- SBA Debt Relief: SBA will pay the principal, interest, and fees of 7(a), 504, and microloans for six months.
States and municipalities are creating economic aid programs every day. For instance, for-profit businesses in San Francisco with annual revenue under $2.5 million and who have experienced a 25% drop in revenue since January 1, 2020, with three years remaining on their building’s lease are eligible for the San Francisco Hardship Emergency Loan Program. This program offers 0% interest rate loans from Main Street Launch in partnership with the city.
And in Denver, the Denver Small Business Emergency Relief program is providing cash grants of up to $7,500 to businesses in industries hit especially hard by the pandemic. In Utah, businesses with 50 or fewer employees who can show an estimated six months of revenue loss are eligible for the Utah Leads Together Small Business Bridge Loan program, offering between $5,000 and $20,000 with 0% interest for 60 months.
These are just a few examples, but you can visit the National Governors Association website and go to your governor’s page to see a more comprehensive list of relief programs available in your area.
Marketing During COVID-19
Is spending money on marketing worth it when you can’t provide your products and services to consumers? Equipped with the right marketing strategy, yes, it’s entirely worth it. Even if you are a brick and mortar shop forced to close your doors to the public, there are things you can do to maintain brand loyalty and stay top-of-mind among your customers so that when you open back up, they’ll be there.
Reach Out and Stay Connected:
Social media has a way of bringing us all together, even when we’re physically apart. Continue to post regularly on Facebook, Instagram, Twitter, or wherever your customers can find you. Start a dialogue, provide updates, and offer any service or resource you can, including tips and advice related to your industry. When this is all over, you will come away with brand recognition and customer loyalty. Just make sure to keep your message, voice, and look consistent. After all, color can increase brand recognition by 80%.
Invest in Paid Ads:
If you are still able to do business, transfer some of your marketing budget to digital paid advertising. With so many other businesses pulling their ads, online advertising has become cheaper. According to Neil Patel, paid ads are also producing a much higher ROI than before the pandemic. He says, “Our clients, in general, have seen their ROI go from 31% to 53%. That’s a 71% increase in ROI.”
Give What You Can
It may seem counterintuitive to give things away for free when you’re strapped for cash, but you’d be surprised at what you gain by giving selflessly. Eric Siu, for instance, chose to give out for free a marketing course that normally costs $1,497. His generosity ended up increasing his social media following and website traffic significantly, bringing in more paying customers as well.
Whether you just started a retail shop, a restaurant, or a dental practice (which is considered among the 10 most trusted and ethical professions in the U.S.), you’re probably struggling to stay in business during this difficult time. Hopefully, the resources and tips outlined above will help you find success.