Category: Strategy

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Business motivation Strategy

Modi Govt Considering Giving ‘MSME Status’ to Dealers to Enable Them to Avail Benefits Offered to MSMEs, Says Nitin Gadkari

Nitin Gadkari | File Image (Photo Credits: Facebook)

The Modi government is considering of giving ‘MSME status’ to dealers which will enable them to avail benefits offered to micro, small and medium enterprises (MSMEs). The announcement was made by Nitin Gadkari, Union Minister for MSME and road transport and highways, while he was addressing a virtual exhibition on ‘Construction Equipment, Technology Components and Aggregates’ on August 18. “Regarding MSME, we are thinking now of giving MSME status to dealers also and they will get benefit of it, that is also under consideration by which they will get the benefits,” Gadkari said.

He said the government is also working on integrating and developing all kinds of transport like waterways, sea transportation, rail, road and air transport which will definitely reduce the logistic cost and help industries in a big way. Adding further, Gadkari emphasised that the government is ready to provide all possible support and industries should come up with innovative plans so that India can be a manufacturing hub in the automobile sector.

The Minister said the micro, small and medium enterprises (MSMEs) comprising manufacturing and services units need to get registered to avail the benefits and subsidies offered under various government schemes. The MSMEs that have been registered are eligible for tariff subsidies as well as tax and capital subsidies. The registration also helps them in getting government tenders and enables easier access to loans at low interest rates.

Gadkari said in order to achieve the objective of self-reliance, the country needs to reduce imports and boost manufacturing of various components in sectors like automobiles and construction equipment. The minister called for research, innovation and technology upgradation and emphasised on the need for joint ventures and foreign collaborations to get easy finance and compatible technology, an official statement said.

The minister also reiterated his appeal to major industries to clear the outstanding dues to MSMEs in a timely manner. He said the Ministry has also requested the Finance Ministry, the industries who want to make their technology centers, training centers, research centers, from income tax point of view, whether we are in a position to give some more support to them by which we can inspire and motivate them for more research and innovation,” Gadkari said.

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Finance Sales Strategy

TReDs Platform Joining Fee Waived For MSMEs till September 20

TReDs Platform
TReDs Platform Joining Fee Waived For MSMEs till September 20 (Photo Credits: Ministry of MSME)

Mumbai, August 18: Narendra Modi government has invited MSMEs to join the Trade Receivables Discounting System (TReDS) platform with zero fees. The free access to the TReDS platform will be there till September 20.

TReDS is an online factoring platform connects buyers, suppliers and financiers. This platform will enable MSME suppliers to get quick access to low-cost finance.

Joining Fee on TReDs Platform Waived till September 20:

Congrats MSMEs !
The fee for joining TReDS platform has been waived. You can get funds against your approved invoices quickly. Register yourself and make your #msmetochampions. @FinMinIndia @sidbiofficial pic.twitter.com/4KdUEyGAaz

— Ministry of MSME (@minmsme) August 17, 2020

What is a TReDS platform?

TReDS is an online mechanism for facilitating the financing of trade receivables of MSMEs through multiple financiers. It also enables discounting of invoices of exchange of MSME sellers against large corporate.

How will MSMEs benefit on TReDS Platform?

Quicker Payment: MSME sellers will receive funds against the approved invoices within 48 hours
Multiple Financiers: MSMEs are not restricted to a single bank. With the help of TReDS platform, they will have the option to choose the lowest bids among the multiple financiers.
Without Recourse Borrowing: There will not be any obligation on the seller to repay the financier. The buyer’s account will be dedicated automatically through a pre-approved NACH mandate.
Lower cost of Funds: Sellers will be able to access financing at competitive terms as it is based on the credit rating of the buyer. The transparent bidding process will help to discover the most suitable price.

 

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Finance Process & Business Expansion Startup Strategy

5 Ideas to Rebuild Small Businesses Amid COVID-19 Pandemic

Few tips that can help small entrepreneurs to rebuild their business post COVID-19 pandemic
Few tips that can help small entrepreneurs to rebuild their business post COVID-19 pandemic. | Representative image

Mumbai, August 14: With the coronavirus lockdown still persistent in the country, small businesses are the most hit. While some have pulled down their shutters completely, others are looking for strategies to rebuild and reshape their businesses. Here are a few tips that can help small entrepreneurs to rebuild their businesses:

1) Financial Damage Assessment:

Every entrepreneur needs to analyse and calculate how bad their business has been affected in the COVID-19 lockdown. The first step that one entrepreneur shall take is to update the financial statements which include profit and loss or cash flow statements. Comparison with previous year’s numbers to see the loss is certainly a good idea to begin again.

2) Reshape Business Plan:

Ideas that might have worked pre-COVID-19 era, may not work after the lockdown. So it is very important to remodel the business strategy and do some fine-tuning. Paying close attention to competitors’ plan is another idea that would certainly help in reshaping the lost business.

3) Focus on Generation of Working Capital:

When an entrepreneur takes an initiative to rebuild the business, especially after COVID-19 pandemic, focussing on the generation of working capital becomes the priority. Without this essentiality, all plans to reshape a business model will turn into a failure. Look out for options for a sustainable and suitable financial lender/s who can show some faith in you (entrepreneur). But, for that, mutual understanding and trust are required, which an entrepreneur will have to build with the lender/s.

4) Revamp Budget Account:

Calculative risks during times like COVID-19 always help in revamping budget requirements for entrepreneurs who want to rebuild their businesses. All business ideas have pros and cons, however, a clear idea of what is needed for budgeting and what can be cut from the expenditure would certainly help in achieving the goal — monetary waste. Salary cut to self and only essential hiring are some of the good ideas that have been prescribed by experts.

5) Contingency Plan for the Next Crisis:

This is perhaps the last, but the most effective way to give life to business while rebuilding it. Learn from the previous mistakes and start working on the contingency plan for the next crisis. Saving the profits by cutting down useless expenditures and adapting self to the new way of business are some ways which will keep an entrepreneur in the market for a longer period. Moreover, thinking out-of-the-box to prepare for a worst-case scenario will be fruitful.

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Startup Strategy

Startup Permissions: Here Are Some Licences And Permits Required To Start Your Own Business in India

Permit (Representational Image, Photo Credits: Picpedia)

Starting a business in India requires a set of permission and licenses for its smooth functioning. Fulfilling the legal formalities is one of the first steps which startups should never ignore. Otherwise, there may be huge penalties and other legal complications which will hamper the name and growth of the company.

Depending on your business, there are certain licenses and permissions that are required. Government agencies can fine or shut down a business that operates without a licence.

Business Licence: A legal document that grants you the right to operate a business in your city. It is a permit which indicates that the company has the approval of the government to operate.

Various Kinds of Business Registration: The various kinds of business registration in India are-Private Limited Company, One Person Company, Partnership Firm, Public Limited Company or an NGO/Trust. A business will have to get registered under any of the above type o structure.

Safety Registration/Fire Permits

Depending on the type of business you intend to operate, you may need to get an inspection and permit from the local fire department.

GST Registration:

It has now become mandatory for all businesses to get their GST registration done. It needs to be obtained within 30 days of business incorporation, otherwise, the startup will be subject to heavy penalties.

MSME Registration

MSME Registration can be obtained by micro, small and medium enterprises in India to enjoy few subsidies and benefits in terms of loans, taxation, and other schemes.

Startup India Registration

When the business comes under the definition of a startup as per the DIPP Notification, it can get its Startup India registration done. There are a few criteria for it, for e.g., it has not been more than 10 years from the date of business registration. The annual turnover of the entity for any financial year since its registration has not exceeded Rs. 100 crores.

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Finance Process & Business Expansion Startup Strategy

Emergency Credit Facility Under ECLGS for Small Businesses Hiked From Rs 25 Crore to Rs 50 Crore, NCGTC Modifies Operational Guidelines

MSME (Photo Credits:
Emergency Credit Facility Under ECLG for small businesses hiked from Rs 25 crore to Rs 50 crore by NCGTC. | Representational Image.

New Delhi, August 12: The National Credit Guarantee Trustee Company Ltd (NCGTC) on Wednesday issued a circular regarding the modification of operational guidelines for Emergency Credit Line Guarantee Scheme (ECLGS). The common trustee company informed that the new operational guidelines will now cover individuals and more enterprises amid the COVID-19 pandemic.

Informing about the minutes of the modification of operational guidelines for ECLGS, the NCGTC stated that the upper ceiling of loans — outstanding as on February 2, 2020 — has been increased under the scheme from Rs 25 crore to Rs 50 crore. Apart from this, there has been a hike in the upper ceiling of annual turnover from Rs 100 crore to Rs 250 crore. This has been done in line with the increased ceiling of loans outstanding and revised definition of MSME issued by Union Ministry of MSME.

Among other details, the NCGTC circular stated that there has been an increase in the maximum amount of NCGTC to Member Lending Institutions (MLIs) under the ECLGS. The amount limit has been raised from Rs 5 crore — at present 20 per cent of Rs 25 crore — to Rs 10 crore, which is 20 per cent of Rs 50 crore. However, it has been made clear that those individual loans given for business purposes should fulfil the eligibility criteria prescribed under the scheme.

NCGTC Circular Regarding the Modification of Operational Guidelines for ECLGS:

Earlier on May 23, 2020, the NCGTC was set up by the Ministry of Finance’s Department of Financial Services as a common trustee company to manage and operate various credit guarantee trust funds. It was incorporated under the Indian Companies Act, 1956 on March 28, 2014, with a paid-up capital of Rs 10 crore.

Under the NCGTC, five trust funds currently operate:

1) Credit Guarantee Fund for Skill Development (CGFSD
2) Credit Guarantee Fund for Education loans (CGFEL)
3) Credit Guarantee Fund for Factoring (CGFF)
4) Credit Guarantee Fund for Micro Units (CGFMU)
5) Credit Guarantee Fund for Standup India (CGFSI)

The NCGTC was launched ECLGS on May 23, 2020, for all the financial institutions of India. Among the four key points, which differs it from other schemes include — 100 per cent credit guarantee, zero guarantee fee for banks and customers, pre-approved loans and minimum bank’s risk weight allocation. However, the scheme will continue till October 31, 2020, or till the time Rs 3 lakh crore of the loan amount is sanctioned. The NCGTC has also made it clear that borrowers must be GST registered wherever it is necessary.

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Startup Strategy

Startups From Home: 5 Business Ideas to Start From Home Amid COVID-19

Startup (Representational Image Only, Photo Credits: NeedPix.com)

Mumbai, August 12: The entire world is reeling under the effect of coronavirus, from businesses being shut, factories non-operational, to employees being handed over pink slips. The pandemic has bludgeoned economies worldwide, and the smallest of businesses have felt the heat. In a scenario, when thousands have gone jobless, we take a look at five business ideas which you can start from the comfort of your own home amid the coronavirus pandemic.

The best part is that these business ideas will require a minimum to no investments. So if you are wondering to start a business from home, here are a few ideas which you can consider.

Sale of Masks, Gloves, PPE

The demand for masks has skyrocketed after countries across the world said that it is an important preventive measure to curb the spread of COVID-19. In India too, all the states have imposed a strict fine in order to ensure that people are abiding by the rule. From being sold as a fashion accessory to a life-saving piece of safety equipment, there is a huge demand for selling masks.

In such a scenario, there is an opportunity, if you want to start a business dealing with the sale of masks, gloves, PPE suits or hand sanitizers.

Remote Tutor

As a result of the coronavirus pandemic, when schools are shut, students are facing the problem to complete their syllabus and struggling with doubts. Here lies a great opportunity for home tutors who can continue to teach their students from home via online classes. One just needs a good internet connection to start with online teaching.

Fitness Trainer

The pandemic has taken a toll on our lives, with additional workload both at the office and at home, people are being stressed. On top of it, fitness centres at several places continue to remain closed. If you are a fitness trainer, then you can start your online classes, be it yoga, power yoga or meditation from the convenience of your home.

Cooking Classes

There has been a huge demand for online cooking classes ever since the lockdown. Your friends, family members, office colleagues have all been experimenting with different dishes and have been putting it up on social media. Amid the coronavirus induced lockdown when people are still hesitating to go to restaurants, they have been making most of the dishes on their own. From experimenting with new cuisines to trying out new ingredients, there is a huge demand among the people to learn quick and healthy dishes.

If you have a knack in cooking or an expert in this area, there is a huge opportunity for you to start with your online cooking classes.

Freelance Writing and Copyrighting

You can take up freelance writing and copyrighting projects. Initially, the payment can be low, but once you build your own portfolio of work, you can start demanding a premium for your service.

So if you want to start something on your own, don’t delay your plan. These are some business ideas which you can start from the comfort and the convenience of your own home today amid the coronavirus pandemic.

 

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Finance Process & Business Expansion Startup Strategy

Innovative Ideas for Entrepreneurs to Keep Restaurant Startups Rolling Amid COVID-19 Pandemic

Apart from unique challenges, the COVID-19 brought fresh opportunities for India in the hospitality and allied sectors. Here are few ideas which entrepreneurs in restaurant startups can try to keep their businesses rolling.
Innovative Ideas for Businesses

Mumbai, August 11: With almost five months out of business due to the coronavirus lockdown, one of the worst-hit sectors in India is the food and restaurant businesses. While many startups opted for innovative ideas, others failed to survive the lockdown. India’s lockdown against COVID-19 is considered to be among the toughest, however, relief measures given by the central government did keep the hope alive.

Apart from unique challenges, the COVID-19 pandemic brought fresh opportunities for India in the hospitality and allied sectors. Many startups succumbed, but few thrive as they looked for a window to keep their businesses running. Use of social networking and personal relations still make those few reaping profits in adverse market conditions.

Here Are Some Ideas Which Helped Small Restaurant Businesses Survive:

1) Use of Social Media:

During the lockdown, the biggest challenge for a restaurant business is to connect with their customers. Social media became a boon for all those startups who remained in contact with their valued customers. Be it Facebook, Whatsapp, Twitter, Gmail or Instagram, these social media apps helped the small entrepreneurs to keep their businesses running.

Apart from providing the latest information regarding the renovations in restaurants to take away services, people came to know it from social media only — if their favourite dining places are open or closed. Also, updating the precautionary measures taken by the firm to keep its customers safe, did make a lot of difference.

2) Adaptations and Collaborations:

Adaptation to norms and guidelines issued by the administration did play a great part for startups. For example, Chaayos — which started in 2012 — joined hands with another influencer marketing platform called Pulpkey. Apart from serving the ‘signature “Meri Wali Chai“, they also decided to create awareness among people. For this, they hired renowned content creators and influencers and started sharing quality content straight to the customers’ mobiles via social media. Hence, Chaayos is still serving the ‘chai drinking nation’ with the same zeal and love.

3) Takeaway and Door-Step Delivery With COVID-19 Protection:

Foodies anywhere are foodies. Be it rain, dawn, dusk or midnight, foodies will order food online. However, the COVID-19 stopped the wheels of food-delivery guys for some time. Business took a hit and many wrapped up their shops.

With the Unlock guidelines issued, the wheels started to roll and food-delivery was again back on track. This time, the food delivery system was a little different. First, the delivery guys maintained a 6-feet distance and secondly hygiene maintenance was observed very strictly. The result was small entrepreneurs in the hotel business managed to survive. Special mentions to food warriors of Swiggy, Uber Eats and Zomato.

4) Marginal Charge for Hygiene:

This is something that customers in India don’t like. Since lockdown is in place and sit-in dining is almost restricted in most places, charging extra for take-away to door-step deliveries — by asking customers to pay for hygiene practices — may take not be a welcome move.

However, making valuable customers understand the importance of hygiene practices and costs associated with it, the gesture might help. These days customers are well aware of the dangers of COVID-19 and are willing to pay extra to cleanliness and hygiene. So looking at the broader prospect, the idea of charging a marginal fee for cleanliness may help entrepreneurs to keep their business functioning.

5) Financial Management and Revenue Generation:

Among all the other factors, the utmost requirement is to keep the startup moving forward with proper financial management skills. Due to the COVID-19 revenues of almost all food-allied entrepreneurs declined, some even bailed-out too. But few are still sustaining and may sustain for long as they have ample revenues for it.

For those, whose revenues are crippling and businesses are on the verge of shutting down, one of the easiest ways is to reach out to banks — which provides loans under MSME schemes at nominal interest rates and easy instalments. Reaching out for funds to family members and friends is another good idea.

6) Patience and Perseverance:

Difficulties and challenges are part of startups. COVID-19 may have seized the business ideas and expansion, but what’s important is entrepreneurs shall not lose hope and patience. They should keep inventing innovating ideas and persevere to reach their goals. Things may take a little time, but with calculative risks and patience, the flower of success will bloom.

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Strategy

How to Avoid the Risks faced by Small Businesses

How can a small business reduce internal and external risks?
Our economy is largely dependent on small businesses as these companies work in producing services or raw material for big brands. Running a business is not a child’s play. A lot of hard work and sweat goes into building a secure business entity. There can be many risks in business, such as the risk of capital, the right manpower, economic slowdown, and even natural calamity. So before setting up a business, every company should pen down the proper planning of their workflow, which affects overall operations because of these external and internal risks. Not doing this could bring the business to a gradual decline.

Factors that affect small businesses to survive in the market:

Internal Risk
Internal Risk is controllable in nature which derives from an improper execution of business plans. There are always some factors leading to internal risk in any company, so how can one overcome it?
1. Risk of Capital
For a small business entity, it is not easy to survive in a highly competitive environment. The risk of going out of business is always at stake.

  • Regular in-flow of funds either quarterly or half-yearly can help the business be ready for any unfortunate situations and to overcome the risk of losing capital.

2. Right Manpower
Finding the right person for the right job is a lifeline for all business ventures. If the key employees leave or cannot perform their duties, then your business could fail, particularly in small businesses that cannot offer attractive salaries and job stability.

  • Small businesses don’t require highly experienced people on the job and there is always a group of people who want to work for companies where they can show their creativity and passion. The right HR team can help businesses overcome the risk of finding the right people.

3. Product/Service Quality Issue
Small businesses cannot offer a low price for their products or services due to high operating costs. Any compromise in quality can lead to a setback for the business.

  • To overcome business risks due to quality issues, a strong QC (Quality Check) team should be kept in place to make sure that everything goes as per plan.

4. Debt
Debt can make the deepest holes in the balance sheet of small businesses. It should be very minimal if not zero, to keep going with their operations.

  • Instead, they should focus more on profitability than on volume, which helps them to avoid taking any loans from external sources and create risk in business.

5. Cybersecurity risk
The best organizations today can bear the cost of the best guards. As these bigger ventures show signs of improvement at protecting against cybercrime, cybercriminals threaten to descend on the business’s natural way of life and also tends to focus on private ventures who can’t manage the cost of complex security systems. Today, private ventures are the favored focus for cybercriminals.

  • At the point when income is restricted, spending on security seems like a risk in business. Acquiring cyber risk and information break protection inclusion, such as taking safeguarding measures to diminish Internet-based exposures can help you avoid falling prey to cybercriminals.

6. Legal risk
Numerous first-time entrepreneurs might not have the skill to assess everything about each agreement they need to sign or they may ignore something accidentally. These oversights can prompt issues in the near future. Legitimate cost protection can spare you from any extra or unforeseen dangers from providers or clients. This straightforward and simple choice can eventually help you save legal expenses and money spent on protection inclusion.

  • Protection or insurance is a key part of every small business strategy. By understanding these dangers for independent ventures, you can make strides at an early stage to deal with the above dangers and secure your property and assets against catastrophes.

External Risks

Businesses have no control over external business risk factors. Small businesses should keep this in mind at the time of planning and setting objectives to avoid the risk in business.
1. Competition
Industry leaders can play with small businesses to keep them out by eating their share of the market. They can reduce the prices of their products or services to make it more affordable for customers; any small business cannot afford to get into a price fight with these big giants.

  • To overcome this risk in business, one should always have a USP (Unique Selling Proposition), which is not possible for competitors to match.

2. Government Policy
Any change in Government policy can shut the small business venture overnight. An automobile engine part manufacturer won’t be getting any business if the government bans the kind of engine this business was manufacturing.

  • It is not easy, but diversification in more than one industry can help overcome the risk of change in government policy.

3. Economic Slowdown
Nobody was prepared for COVID-19. After this outbreak, the most affected industries were Hospitality and Travel. Consumption became very low in these cases and when there is no or very less demand, businesses cannot make any revenues.

  • To overcome these risks in businesses, one should always keep emergency funds ready for bad times.

4. Natural Calamity
Accidental fires, earthquakes, and tsunamis can happen without any warning. At times, the losses could be beyond recovery if a small business entity has not prepared itself for these situations.

  • A good insurance plan can help to avoid any such losses.

Therefore, in every business which faces risk, there is always a silver lining that offers hope and helps you to overcome it. One should be motivated and must have a positive attitude towards every situation that can impact you in the future.

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Strategy

Small Business Disaster Planning Checklist

बिजनेस टिप्स
बिजनेस टिप्स

Risk Preparation in Business: Key to fight Natural Disasters

In India, companies are not generally prepared for any kind of disaster but it is imperative to have a plan in place. Many small business owners do not understand the importance of a natural disaster plan. Being a business owner you might be ready for internal & external business challenges but you should also be ready for the challenges that Mother Nature throws your way. Unpredictable disasters can cause extensive damage and might take everything that you have; but proper business disaster planning can reduce the loss. You need to understand that it does not take a major disaster to impact your business; even a power failure that can shut down your phone systems can lead to a revenue loss.

Before going forward let’s discuss the business disaster planning checklist:- 

1. Transfer all your business documents to the cloud

  • Whether your business is threatened by any disaster; such as fire, heavy rain, earthquake, permanent loss of critical documents can be devastating.
  • To avert the loss of your paper documents and records, you must move all your documents to the cloud.
  • Make sure you digitalize your entire systems and documents to ensure access to your employees to continue working on the projects.
  • Make a proper business disaster planning checklist to avoid any kind of hassles during the disaster. Make sure you train your employees and share the business disaster planning checklist with them so that they are also prepared for the worse.

2. Safety first

  • The safety of you and your employees is of primary importance during an emergency.
  • Every business must have an escape plan and should test this plan regularly with their employees to ensure its viability.
  • Make sure you provide proper training and workshops to fight back during a disaster.
  • Ensure business disaster planning, backed up with proper medical support.

3. Enough funds and insurance to cover the expenses

  • It is important to have enough funds to cover up the operational expenses, inventory, and payroll.
  • Do not wait for any kind of disaster to seek insurance. Insurance will help you and your business recover the loss that happened during the disaster.
  • The insurance policy can help you to cover the damage of inventory, building, computers, big machines, and antique cash registration.
  • Make sure you have 2-3 policies in your hand for your business.

4. Everything else

  • Make a business disaster planning checklist that is easy to access and clear to everyone.
  • Make sure your business supplies are well stocked.
  • Make a list of all the emergency contact numbers of your employees, including the nearest police station, fire station, lawyer, local suppliers, and utility or any other emergency management service.
  • You should regularly test your business disaster planning with your employees to prepare them for the worse.
  • Pen down all the important processes and functions of your business and bills you have to pay regardless of the circumstances.
  • Have a digital copy of your contracts, leases, and at least one person other than you should have the ways and means to access it.
  • Be prepared if the insured fund or loan fund does not arrive immediately.

Business disaster planning is one of those things that you should always prepare for but we hope you never use it. Building a business disaster planning checklist can help you go a long way in channelizing your disaster response mode. Owners need to be prepared for everything that can harm the business and they need to have a disaster plan in place to minimize the impact of the disaster on their livelihood.

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Strategy

5 Tips to Build an Effective Crisis Management Plan

Be Prepared: How to build an Effective Crisis Management Plan

Every entrepreneur should understand that even the best of business plans can go off course during an unexpected event. Therefore a business crisis plan is a must. We usually tend to procrastinate while preparing a crisis management plan, but unfortunately, disaster can strike at any stage, and having no back up at that point of time can be risky for the business. Here are some tips to keep in mind while preparing for a business crisis.

1. Build a Crisis Management Team

  • It is important to have the leadership team involved in the crisis management plan
  • Involve people from different disciplines, so that all views and points can be accommodated in the final business crisis plan

2. Assess the Risks

  • Identify potential risks that can disrupt your business and work with all stakeholders to assess the risks
  • Devise a contingency plan for short-term as well as long-term. Once the potential risks are known, make a crisis management plan for a period of 3 months, 6 months and then one year. You never know how long the crisis can last
  • For e.g. no one anticipated the Corona virus outbreak and the lockdown that will follow. Hence businesses need to plan for the entire year in this case, to make up for the losses incurred by them and by the predicted slowdown
  • Carry out a Business Impact Analysis to evaluate which side of the business will be impacted the most. Will it be customer satisfaction, lowering of sales, payment defaults from vendors or damage in reputation in the market?
  • Once you know the extent and areas of impact, damage control measures can be listed and put into action during a crunch situation

3. Determine your Contingencies

  • Now that we have assessed the risks and the functions that can get impacted, the next step is to jot down how can the crisis be solved and what resources can be used efficiently to do so
  • Keep an emergency line of credit handy. You never know how long the crisis lasts so knowing from where you can get funds is always a plus
  • Include your employees in crisis communication management. Your marketing team, customer care teams and business heads need to know how they are going to communicate during a problem
  • A business crisis plan requires you to train your employees to tackle such situations and also be ready to take on additional functions to ease the pressure of on some teams. Also keep updating them with new skills, you never which one comes in handy during a crisis

4. Act Quickly

  • Though we advise you to act quickly during a crisis, but that doesn’t mean you take hasty decisions. During a crisis you need to be even more careful about how you battle the situation
  • For e.g. In the early 2000s, Cadbury was in the eye of the story when worms were found in their Dairy Milk Bars. In less than 2 weeks a PR campaign was launched for the trade followed by a nationwide ad campaign with Amitabh Bachchan on their new and improved poly-flow packaging.
  • Key learning here is that, Cadbury was quick in their damage control, they did bear a heavy cost of the damage but soon customer confidence was back and they started achieving their sales numbers
  • A crisis management plan needs to have steps that can help act faster

5. Keep your Business Crisis Plan updated

  • Review your crisis management plan on a regular basis for possible updates or market changes
  • We keep talking about the business environment being highly dynamic; there are changes in the market, technology up-gradation and sometimes there might be a case that employees who were a part of this plan might have left the organization. Hence, revisiting the plan will be beneficial for your business

One thing that Covid-19 has definitely taught us is the extent of impact a crisis can have on your business especially when there is no plan in place. If companies who are on the verge of a shutdown had a cohesive crisis management plan, maybe they could sail through these tough times. As they say, ’Better late than never’- there is no harm in having a general preparedness in place for your company to be financially sound in the long run.