4 Ways for your Business to Survive (and Possibly Thrive) During the Pandemic

Having the flexibility to adapt isn’t a top priority for many businesses ─ especially when times are good. Continuous expansion and progress are the usual measures of success, and they are more obtainable when the economy is humming along.

However, when businesses experience a serious downturn ─ as we are right now with COVID-19 ─ companies must take a hard look at how they operate and determine what, if anything, they can do to weather the storm. The firms that successfully come out on the other side of the downturn will be those that have the ability to be flexible and resilient.

If your company is feeling some financial strain right now, here are 4 concrete ways to inject greater flexibility and resiliency into your organization so you can withstand the pandemic and emerge from it even stronger.

1. Assess Your Customers’ Financial Health

In the B2B world, many customers are asking their suppliers to extend due dates. Managing these requests can be challenging. While you want to be reasonable with your customers, you must balance that with very real concern regarding when and if you’ll receive payment.

Credit Plus offers a COVID-19 US Business Risk Index, which provides a view of the potential impact of the pandemic on your business’ operational activity, as well as your network of suppliers and customers. It analyzes various business data to generate insights that can help you project and test impact scenarios state by state and develop alternative strategies to weather those impacts. Ultimately, this tool can help you determine if your customers are in a difficult financial situation and arm you with the data you need to possibly change the terms or reduce the amount of product you sell to them to reduce your risk of not being paid.

Another way to assess your customers’ financial health is with Business Activity Monitoring. This tool allows you to monitor key customer metrics for changes to financial health, credit scores  and public record filings. You can also set up alerts so you can better assist your customers with their evolving needs.

2. Thoroughly Vet New Suppliers

Many industries’ supply chains were disrupted when the Coronavirus hit, which left companies struggling to find replacement suppliers. It is oftentimes difficult to identify reliable suppliers, but it’s even more so in the midst of a global health and economic crisis.

Carefully scrutinizing new suppliers is a best practice that can ease this challenge. Credit Plus offers a risk assessment program that analyzes numerous financial and legal components including:

  • OFAC sanctions list
  • Financial stability
  • Certifications
  • Insurance

When a business is trying to stay on top of fulfilling orders, thoroughly vetting suppliers is often side-lined. And as a result, bigger problems arise down the line. Consider this: If you partner with a supplier that is deeply in debt, they could file for bankruptcy just after you pay them for an order ─ one you would likely never receive. Or, if a supplier suddenly cancels their insurance coverage, it could mean they are struggling financially. Staying on top of this information will enable you to proactively deal with suppliers and prevent unwelcome surprises.

3. Exhibit Flexibility when Dealing with Customers

Customer relationships should never be taken for granted, even when they are strained due to late payments. While being stricter with customers during the pandemic is tempting, keep in mind that COVID-19 won’t last forever. When we emerge from this, companies will remember who was flexible about due dates, payments and terms – and who wasn’t. If you can treat customers well while they are struggling, they won’t forget about you once this crisis is behind us.

4. Identify Better Ways to Determine Creditworthiness

Many businesses depend on a company’s credit information to determine its reliability as a buyer. But there are other tools out there that can give you a more comprehensive view a prospect’s creditworthiness and determine what kind of terms to offer them.

To be more responsive and confident in the terms you extend, you must base your credit policies on the current state of the prospective customer’s finances. To do this effectively, you must use the most accurate and reliable data available.

Unlike other companies that offer self-reported data, Credit Plus offers Business and Business Owner credit reports and credit scores that are built with data, making them inherently more reliable. We also offer Intelliscore Plus from Experian which uses three analytic approaches to provide credit risk management insights for small businesses:

  • Business data
  • Business and consumer data on the owner/guarantor
  • Consumer-data-only model for new enterprises with no business or credit histories

We even offer DecisionIQSM, an end-to-end application that allows you to customize and fully automate the credit decisioning process.

In this rapidly-changing environment and its uncertain impact on our economy’s future, being flexible is critically important so you can alter course quickly if and when your prospects’ and customers’ financials change for better or for worse. That flexibility will produce a resiliency that will help you weather this pandemic and emerge a stronger business in the months and years to come.

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