Welcome to the second half of 2020.
Having gone through the wild and unpredictable ride of the past four months, where do you go from here? Do you have a handle on various scenarios that you can plan for the next six months?
Rather than wandering aimlessly through the rest of the year, it’s worth establishing three scenarios that you can adapt to depending on the continuing impact of the pandemic and economic challenges. Here are some broad strokes that can help to inform your specific situation.
Worst case scenario: Revenue is still significantly down and prospects of returning or new business are low. You have laid off and/or furloughed employees after your PPP money ran out and the short term looks bleak.
- Action: Support your remaining staff, keeping in mind that they are terrified, too. Continue to cut expenses where you can. Stay in touch with clients or customers. Consider repurposing your company to stay afloat.
Cautious scenario: Revenue is slowly picking up and prospects are promising in the medium term. You are having good discussions with clients or customers that reveal more possibilities in the fall.
- Action: Support your staff as best you can and stay in touch with any furloughed employees. Stay connected with your clients or customers. Vigorously manage expenses in the meantime.
Optimistic scenario: Revenue has picked up and you are certain that future commitments from clients or customers will hold. Prospects have expressed interest in your products or services. You are confident that you can either bring back furloughed employees or hire new ones, depending on your situation.
- Action: Keep doing what you’ve been doing, stay connected with your clients, support your employees, and don’t get complacent.
Why three scenarios? Because as we’ve seen, the future is unpredictable. You may be operating under the worst case scenario today, but could move into the cautious one in a few weeks. Too much is still unknown, which is why multiple scenarios are necessary.
Whatever you do, don’t just wander.