The Indian economy is poorly affected due to coronavirus outbreak. This has worst affected the small businesses in our country. The big companies have enough revenue, contingency funds, and significant customer base to survive the outbreak with not much loss. However, small businesses don’t have enough funds for themselves to survive. Thus, by the time this crisis will come to an end, most of them would be in a situation to shut down. Well, the small business owners can still prevent their businesses from such damage.
Let’s take the example of a hypothetical salon in your neighbourhood. Until the coronavirus crisis hit, the business was flourishing. All the employees worked together, and the customers were satisfied with all the services as well. The business owner was about to expand the business, but the coronavirus outbreak hit the market. Suddenly, the customers no more showed up at the store.
At first, the business survived by taking out something from the revenue. But later, even that dried up. The bills kept coming. The business owner no more requires to pay electricity bills and other such bills. However, there is still a higher cost that he needs to pay every month: shop rent. And the business owner also faces one ethical dilemma: does he still need to pay salary to the employees?
In the end, the business owner is left with a little cash reserve, operating margins are very thin, and the savings are already spent. What to do next? What earlier was a thriving enterprise is now struggling even to keep running. This may lead the business to shut down in some time.
Well, the example is, of course, hypothetical. Still, many such businesses in the market may shut down after this outbreak.
But you don’t need to worry. You can still work some strategies to help your business survive the COVID-19 situation. Let’s take a look at some points that will help your small business.
Also Read: Coronavirus Symptoms: How Can You Be Safe?
Revisit your Suppliers
Your main objective is to conserve cash for your business, which can be done in various ways. So, you can go to your suppliers and vendors and ask for their help. Your suppliers and vendors too would like to want you in business, as they do business with you. So, tie up with others, it is more likely to help you in the time to come.
Well, you need to focus on what is happening right now. You need to keep an eye on the changing situation. However, you also need to spend time and think about how you would be rebuilding the business once everything gets normal. You need to give time and think about how you can efficiently use the coming opportunities. You can seek the help of financial professionals who can help you with determining the reopening cost and devising a plan for the same.
Avail Small Business Loans from Banks
The banks offer a different kind of small business to business owners operating in India. If you need more working capital in your business, you can avail a bank loan. Here, you need to borrow as much you require. However, we suggest you keep a look at all your requirements and then only apply for a business loan. Since it is a type of credit and you need to repay it later, you should only avail what you can repay.
You can avail short-term as well as long-term business loans, as per your requirement. The loan tenure ranges from 12 months to 10-15 years.
Contact People you Rely On
We recommend you to talk to the people with whom you regularly work, such as banks, vendors, etc. You can look for local organisations and alliances to join all the resources and advice. Networking, in this time, can be beneficial – it can help you learn how to cope with the situation.
You also need to treat your employees well. Be optimistic that everything will go fine, and you will be able to reopen your small business. Besides, also give positivity to your employees and workers that they are going to return to your business and not losing their jobs. Once they come back to you, they are more likely to work harder to help you relive your business.
Business Loans from NBFCs
NBFCs offer online business loans. Their entire loan application is online. Thus, in the time of lockdown and curfew in your area, you don’t even need to go to their office in person. You can apply for a business loan with them online. Also, you can submit the documents online by clicking their picture and uploading the image on the lender’s website. The verification from the lender’s side is also done online. And if everything goes fine, the loan application will be approved, and you will have to sign the contract digitally. Notably, the entire loan application process does not take more than three days*.
The other benefit of NFBC business loans is that they come unsecured. To avail a business loan from an NBFC, there is no need to pledge security. So, in this time of crisis, you don’t need to offer any of your assets to get a business loan. This saves you from the risk of pledging your asset. So, this further protects you from all the hassles.
You don’t need to sugar coat anything. It is a bad situation everywhere and would most probably go till the summer season. So, whatever you are running, be it a restaurant, shop, or any other small business, you need not lose heart. The difficult time shall pass. You just don’t need to lose hope, stay focused, and take little steps now so your business doesn’t suffer now or anytime later.
There are plenty of NBFCs and banks which are providing business loans to businesses.
No, usually banks and NBFCs offer business loan at same interest rate as they are providing unless they recently made some changes.
Both banks and NBFCs hare their pros and cons but if you want to get business fast then NBFCs are best. As they don’t require more documents.