COVID React Toolkit – May 5th

by: Stratford Managers

Updated as of May 5, 2020

“Things turn out the best for the people
who make the best of the way things turn out.”

-John Wooden

Every organization is coping with a new reality. Some organizations have quickly assessed their changed situation, made decisions and started executing changes. Others have barely begun to adjust to this new environment. Although we’re all moving at various speeds and trajectories, we are all moving through the same recovery framework.

 

To meet you where you are right now, we’ve put together a COVID React Toolkit – Strategies, tools and resources to help you navigate and propel your people and organization forward from a position of confidence and strength.

The Big Picture.

Managing Your Financials


Every organization has been impacted in some way by this new environment. The timing of impacts varies significantly depending on your sector, but as a bare minimum, moving to remote work has increased costs and reduced productivity to some degree.

Here is a simple chart that illustrates the type of revenue variations organizations might experience over the balance of the year.

Assessing your situation and formulating an action plan should be based on an intentional and thorough review of your income statement and balance sheet. There are several resources and programs available from the Federal government to support employers, employees, and individuals.

Your efforts are best focused on your immediate pain points. Questions you should consider:

  • Is your revenue seriously impacted? Right now or down the line?
  • How strong is your cash position?
  • Have you taken on additional expenses?
  • Is production or productivity down due to physical distancing or increased remote work?
  • Are there particular expense lines that you need to manage more carefully?
  • Have you begun to contemplate workforce adjustments?

Based on your answers to these questions, you’ll know where to focus as you review your financials and The Big Picture.

We’ve broken down and expanded the Big Picture below to provide you with resource considerations and tactical approaches that you may want to consider.

Taking Good Care of Your People.

Managing Your People Expense


The Canadian government has stepped up to support employers, employees, and individuals but you may still need to make some tough decisions to manage your people expense and your bottom line.

Salary/Wage-Related People Expenses

As you consider your options for managing your salary/wage-related expenses, we have identified the federal programs that are available depending on which route (or combination of routes) you choose to take.

!Take Action! Now is the time to plan ahead and think about what your workforce needs to look like when business recovers. This will help inform the actions you take in the shorter term to manage your people expenses.

HR Support

We’re here for you!

Neil Crawford
Our HR expert Neil is here to help if you have any questions or if you just need a friendly ear to talk through your options. No charge of course. He’s here to help!
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Maintain current workforce & hours of work

Reduce hours of work

Reduce workforce

Support employees impacted by COVID-19 (health and isolation)

 

Non-Salary/Wage-Related People Expenses

Of course, there are people expenses beyond salaries and wages. Chances are you’ve had other people initiatives underway that were an expense on your income statement, but important to the growth of your team and organization. Here are some ideas on how to manage these additional people expenses.

People-Related Technology

        • Pause/delay projects or re-negotiate scope
        • If renewals are pending, delay license renewals

Learning/Development

        • If you have sunk costs, accelerate e-learning to maximize returns
        • Consider new e-learning to strengthen remote work management, productivity, and effectiveness
        • If you have variable costs, pause pay-as-you-go learning/development

People Program Development

        • Pause/delay projects or re-negotiate scope

Benefits/Employee & Family Assistance Programs

        • Promote health-focused programs to reduce long-term costs

 

Return to the Big Picture

 

Strengthening Your Position.

Managing Your Other Expenses


You can do a lot to manage your other expenses. Everything from occupancy, fixed assets, inventories and supply chain to your technology, general overhead and projects. We’ll take a look at each and provide you with some thoughts and a few actions to improve the health and strength of your current financial situation.

Occupancy

Home is where the heart is, so ensuring your space is there when you emerge from isolation is important, but it doesn’t have to be such a heavy burden to your finances. Here are a few steps and actions for you to consider to help lighten the load.

      • Negotiate rent reduction/deferral and operating cost reduction
      • Delay/pause moves/leasehold improvements
      • Liquidate real estate (& possibly leaseback)

!Take Action! Talk to your landlord about your rent and possible changes that could be made to assist with you cashflow needs (rent reductions, deferrals, etc)

Finance Support

We’re here for you!

Our finance expert Norm is here to help if you have any questions or if you just need a friendly ear to talk through your options. No charge of course. He’s here to help!
Connect with Norm

 

Fixed Assets/Inventories/Supply Chain

Now is the time to do a little spring cleaning in your business. Clean up equipment and storage, streamline your distribution, and perhaps find opportunities that didn’t exist before. Here are a few suggestions to strengthen your resolve and improve your cash flow.

      • Liquidate obsolete/unused materials/products/fixed assets
      • Purchase fixed assets for future requirements at a discount
      • Mothball unused equipment
      • Write off & dispose of obsolete inventories to save storage costs
      • Re-negotiate terms with suppliers (e.g. cost, approaches)
      • Review shipping methods/terms and consider alternatives

!Take Action! Consider purchasing hard assets that will be required in the future. They may be at a much lower price or with better payment terms than under normal circumstances.

 

Technology

We’ve all made the move to working remotely or adapting the way we work to include social distancing restraints. This shift may have put a focus on your technology infrastructure, applications, and support. Here are some considerations as it relates to your technology expenses.

      • Consider outsourcing your IT infrastructure and support
      • Pause/delay projects or re-negotiate scope
      • Delay license renewals for non-essential applications

 

Overhead/ Projects

Getting overhead costs down doesn’t mean you have to put a halt on progress, in some cases you may want to step on the gas. Here are just a few things to consider to justify or minimize overhead and project costs.

      • Reassess marketing priorities and spending
      • Rationalize industry and other memberships and/or delay renewals
      • Pause/delay projects or re-negotiate scope
      • Review service providers and re-negotiate terms/mandate/scope
      • Adjust insurance coverage for current operations and defer premium

!Take Action! Contact your insurance provider as there may be a change in your policy coverage, cost and payment schedule that can be made to help increase your cash flow.

Return to the Big Picture

 

Appreciating Your Relationships.

Managing Your Finance Expenses & Balance Sheet


We’re all in this together. You’ve heard it a lot the past few weeks and it’s true. Exploring your balance sheet and looking for improvements within your financing expenses can mean interacting with your partners and clients in ways you perhaps haven’t in the past. Here are a few ideas and approaches that you might want to consider to help you financially, and that may also improve your relationships going forward.

Accounts Receivable

    • Collect on older accounts negotiating terms as required
    • Consider factoring accounts receivable to improve cashflow
    • Use a collection agency to collect unpaid long-dated receivables
    • Offer small discounts to accelerate invoice payments
    • Contact well-financed clients to gauge interest in early purchases

Accounts Payable

    • Negotiate delay in supplier payments or request discounts
    • Defer GST/HST/Custom Duty payments as announced
    • Defer Tax Remittances as announced

 

Return to the Big Picture

 

Reimagining Your Future.

Managing Your Financial Strategy


Strategy Support

We’re here for you!

Colleen Kelley
Our strategy expert Colleen is here to help if you have any questions or if you just need a friendly ear to talk through your options. No charge of course. She’s here to help!
Connect with Colleen

There is more to our current situation than simply damage control. Amid the chaos there are opportunities for improvement, growth and transformation that we were unable to see before. As you move through the stages of disaster recovery at your own pace, consider some of these strategic approaches to strengthen and improve the health of your organization.

Potential Strategic Actions

    • Sell a business/product line to generate cash
    • Change your product roadmap in response to market changes
    • Consider a merger to leverage cost-sharing and grow revenue

Return to the Big Picture

 

You Are Not Alone.

Managing Uncertainty with Support


We are here and ready to help you with any needs you may have in this time of upheaval. If we can help you provide strength to your leaders and organization please don’t hesitate in reaching out, especially if you’re worried about finances. We’re happy to have conversations, act as a sounding board and provide advice without charge. We are here to meet you where you are right now. We genuinely want to know and care about:

  • What’s happening for you and your organization right now?
  • How are your leaders doing?
  • How are your employees doing?

Our greatest reward is in our client’s success, and that’s seeing you and your business through this uncertainty such that you’re stronger than before the upheaval.

Contact Stratford


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