Every business owner has been concerned about how their business will survive the COVID-19 pandemic. Although the government has announced measures to help businesses and employees, these are relatively short term and may not be enough to save every business.
It’s important to be aware of what methods are available to fund your business during the pandemic, allowing you to survive and flourish in the future.
- Check Government Grants
The government is offering an array of grants to help businesses. Don’t assume you know about them all or have claimed them. It’s worth taking a look at what’s on offer and whether your firm is entitled to this type of aid.
If you are taking aid, make sure you’re well aware of the conditions attached to any financial loan or grant, you’ll need to document everything to ensure there are no issues to worry about in the future.
Don’t forget that alongside the employee financial aid you can ask employees to drop their wages temporarily, providing it will help them to keep their jobs in the long term.
- Corporate Finance
The logical place to start your search for finance is to speak directly to a corporate finance specialist. These are the people that will understand the current situation facing businesses and the best options available in the current marketplace.
As specialists in corporate finance, they should also have access to an array of funding opportunities that you may not find elsewhere.
- Friends & Family
The second thing to do is to talk to your friends and family. Some of them may be prepared to lend you money or even invest in the business, in exchange for shares or a piece of the profit in the future.
Of course, if you choose to seek financial help from friends or family you should be very clear about the potential risks. It’s important to have the terms written down for clarity in the future, you don’t want to ruin a good friendship just because the company continues to struggle.
- Invoice Factoring
If you already have a good customer base and offer credit facilities you may be able to raise additional funds re-invoice factoring. This is when you effectively sell your customer accounts to a third party. They handle collecting the fund, releasing the majority of the sums owed to you now. This can be a considerable cash investment, especially if you have a sizeable number of credit customers and you’ve never done invoice factoring before.
Another way to fund your business during this difficult period is to look at what products you are currently offering and assess whether you can change them, add to them, or diversify your range.
The idea approach is to look at what products are needed during the pandemic. There are obvious items such as masks and plastic screens, but there are also plenty of less obvious options. Adding these to your product range, or even temporarily changing what you produce, can help you to keep funds coming in and maintain, or even build, your business.