As small business owners, we are faced with financial decisions on a regular basis. Now, more than ever, it is important to take action on some strong financial decisions. If you have bank loans, outstanding bills, credit card balances, etc., you need to put together a 6 –12 month action plan.
The first step is to look at your loans. Banks are now giving three months of payment deferral. That means no payment AND no interest. If your bank has not offered that, you need to call and ask them. Some banks are not offering until they are asked. Your relationship with your banker is more important than ever. Reach out to them and let them know your situation. My banker at Pinnacle Financial reached out to me two weeks ago to let me know that she is here for me if I needed her. She and I have texted and emailed every day this week. Your banker is here to assist and now is the time to ask for help.
If you have credit card balances, your credit card company will work with you. Lenders are deferring late fees for 2-3 months. Call them right away and make payment arrangements if needed.
It is also important to have a substantial line of credit available. Your line of credit should support your business for 3-6 months. If you have not established a good line of credit, call your bank on Monday morning and get the process going. Once the line of credit has been given, you should use your best judgement regarding drawing the cash and having it available in your checking account versus relying on the bank to have it when you need it.
Finally, call all of your suppliers and see if they will work with you on payments for outstanding bills. Ask for deferrals or payment options.
Everyone is in this together right now. We need to remember that CASH IS KING. We need to keep as much cash liquid as possible. This is not going to simply be a two to four week slow-down of our businesses. We need be ready for the long haul.
Dr. Bobbi Stanley has more advice to offer based on her 25+ years as a dentist and business owner and will be addressing subjects like, virtual consults, best use for the doctor’s free time and how to continue paying the team, in the coming days.
*This information should not be substituted for banking and legal advice from trained, financial and legal counselors.