While some signs indicate we may be almost out of the woods with the major effects – lockdowns, quarantine, business shutdowns — of the COVID-19 pandemic, based on recent data, the reality is that the aftershocks of this unprecedented time will continue through 2021. Between layoffs, cutbacks and working from home, we have been experiencing an erratic and unstable time with extreme economic uncertainty which has left millions of people unemployed, furloughed, or on reduced hours. With personal financial hardship on the horizon, while some may think this is the worst time to start a business, in reality, this might be a good time to start your own business and create your own job security.
You are not alone when considering starting your own business – the Census Bureau reported in mid-May that they have had over 500,000 applications for an employer identification number since March. The Small Business Administration has also issued nearly 300 start-up loans to the tune of $153 million. Sometimes with an economic downturn, the best way to get back to work is for entrepreneurs to follow their passions and create small businesses.
Here are some more stats to motivate you: As of the start of 2020, women-owned entities represented 42% of all businesses ? nearly 13 million in total ? and was more than doubling the annual growth rate of all businesses over the past five years.
Combined, women-owned small businesses employ 9.4 million workers and generate revenue of over $1.9 trillion annually. Despite COVID-19, women-owned businesses are getting creative, pivoting and doing what we do best to thrive…and new women-owned businesses are launching at a rate of 2.5x that or male-owned businesses.
Here are four tips to help jump start your confidence in starting a business during a pandemic.
It can all seem grim with the uncertain economy and political climate, however, this is an excellent time to start a business that offers solutions for the trials that we now face. Entrepreneur, billionaire and Shark Tank star Mark Cuban agrees – he recently told Bloomberg News that the pandemic has created opportunities for entrepreneurs.
When considering starting a business during COVID-19, ask yourself if your business solution is addressing a short-term problem or an issue that has been present for years now, but COVID-19 has made it into an urgent problem.
If you find that it is the latter of those two options, then you may have a great business idea. REV, the brand strategy firm, suggests that when building your business model, 20 percent of every business should be room to experiment with new products or services, giving you a chance to innovate for the future.
Even in the best of times, small businesses can be nimble and adapt to the needs of customers faster than larger companies ever could. As an entrepreneur who is starting a business, you can adapt your business to meet the needs of customers as we all work together to find the new normal in our communities. We have already seen some of this type of adjustment, such as when businesses move to a more web-based operation or restaurants make curbside pick-up or delivery available.
The Small Business Development Center Network suggests that those looking to start new businesses during COVID-19 should reach out to other small businesses that may have a similar business model and ask them what their challenges have been during the COVID-19 pandemic. This will allow you to make plans to address problems before they arise.
3.?? Take Advantage of a Displaced Workforce.
As I mentioned before, many people are unemployed. This is an opportunity for entrepreneurs who are looking for a team to find highly valued talent. Think of ways to recruit and interview virtually, making the process as painless as possible for both the interviewer and those who you are trying to interview.
It is also important to have training and onboarding that is virtual or with appropriate social distancing. According to the Atlanta Small Business Network, they foresee virtual hiring to be a mainstay in business going forward, so it is best to establish this practice early on.
Starting a business during COVID-19 means finding opportunities to negotiate for lower interest rates for borrowing start-up capital. As of August, the Small Business Administration is offering loans at the lowest interest rates since July 2018.
Businesses are trying to lower their inventory level during COVID-19, so finding used or new equipment that is significantly cheaper is far easier than before the pandemic. Starting a business during a pandemic affords small business owners the power to negotiate with landlords for lower lease rates, potential subdividing, and late-payment fee waivers.