There are nearly 30 million small businesses in the U.S. These businesses, defined as those with fewer than 500 workers, employ 57 million people, according to 2019 data from the Small Business Administration.
No one knows exactly what the Coronavirus’s effect on small business will ultimately be. Firms whose employees can work remotely from home, such as software companies, will likely come out better than those whose businesses involve physical goods and services, and where the business model involves meeting in person.
“It’s tough to answer all the questions, because we don’t have the answers,” said Mike Hennessy, CFA, CFP®, CEO and founder of financial advisory firm Harbor Crest Wealth Advisors in Fort Lauderdale, Florida. “I can’t tell business clients, 'If you just do this, we’ll all come out like roses.’”
Although there’s no set prescription for successfully weathering the pandemic, there are strategies, such as moving work away from other people, protecting cash flow, and planning for the long term, that may help small businesses stay afloat while minimizing losses, say financial planners and business owners.
Money gave the following tips:
- Expect that the virus’s economic effect may last as long as 18 months
- If you can, work in ways that maintain social distance
- Divide expenses into “must have” and “nice to have”
- Expect to use some savings
- Take whatever help you can
You can read the full March 2020 Money article "From Deliveries to Gift Cards, Here's What Small Businesses Are Doing to Cope with Coronavirus" here.
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