Mid-Sized and Small Business Recovery: How Business Has Changed Since the Pandemic
We face an entirely different world from the one we exited just a few years ago. From businesses being forced to embrace virtualization and experimental work models to what’s being described by many as the next recession, things have changed, and they changed fast. Just as business owners start picking up the pieces, something else comes along that forces them to start from scratch. Few businesses thrive during a recession—has your business struggled to keep up?
If so, we can help! Read this guide to mid-sized and small business recovery and we’ll break down what’s changed, how it impacts you, and what you can do about it with some post-pandemic business ideas.
Work Models
What’s Changed
We don’t work like we used to, and we probably won’t be going back any time soon. Hybrid work models are here to stay—in fact, 74% of U.S. companies plan on permanently implementing hybrid-work models. Some companies have taken it a step further and even incorporated fully-remote models. Employers are more eager to post and hire for fully-remote positions across the board today.
These changes have led to a decentralization of the American workforce. Employees are now divided across cities, states, or even countries.
How It Impacts Mid-Sized and Small Business Recovery
These work model changes have forced small to mid-sized businesses (SMBs) to compete with corporations on multiple fronts.
Now that corporations are hiring across the country, small to mid-sized businesses have to compete for talent with companies across the country. This is especially challenging because larger employers may be able to offer benefits, incentives, or other advantages that a smaller business simply isn’t capable of matching.
SMBs also lack the technology to implement these policies. Larger businesses have access to a greater pool of financial and technological resources to execute nationwide employment practice.
These changes to work models have made it difficult to keep up. Many SMB owners have started to lag in making their payments to debtors. On the other side, more uncollectible accounts expenses are being recorded than ever before.
What You Can Do:
Innovate or die.
Employees expect hybrid work options and will refuse to work for a business that doesn’t offer them. If you’ve struggled to implement a hybrid work model, follow these tips:
Manage Expectations
Excellent communication is key to making sure that your hybrid model is well-executed.
Stay transparent about the transition to hybrid with your employees and make procedures clear. Specify what tasks can be done virtually and what processes will require an in-office presence. Finally, make sure that your managerial team is enforcing and following these rules. Management sets the tone for the rest of your employees, so make sure that they embody the right values.
Invest in the Necessary Technology
It’s imperative that you invest in technology sooner rather than later. The longer you wait to innovate, the further your company falls behind. Make sure to properly train your employees on utilizing this new tech, otherwise you could be dealing with a lengthy adjustment period.
Ensure Unity and Connection
In hybrid work models, employees are commonly “siloed,” overly focused on a singular process and detached from the greater whole of the business. Siloing makes your business less flexible and could cause process inefficiencies or communication breakdowns.
Avoid this by establishing thorough lines of communication with remote employees. A regular line of communication will aid your mid-sized or small business recovery by ensuring that hybrid employees are comfortable getting in touch with everyone else.
The Economy
What’s Changed
93% of U.S. businesses are worried about a recession over the next twelve months. Inflation has already started to impact demand, with 38% of small businesses reporting that they’re already facing an inflation-related decline in customer demand. We’re set for some harsh economic times in the near future, and we’ve already begun to feel its effects.
How It Impacts Mid-Sized and Small Business Recovery
There are fewer customers coming in, and the customers that are buying struggle to make payments. These AR difficulties have caused businesses to deal with more bad debt, uncollectible expenses, and has lowered their overall working capital. Working capital taking a hit can be devastating if you’re heavily reliant on healthy cash flows. Mid-sized and small business recovery is especially difficult in industries like:
- Retail
- Manufacturing
- Automotive
- Telecommunications
- Transportation
What You Can Do:
Have you felt the recession in your AR? If so, follow some of these tips for improving your accounts receivable!
1) Transition to a paperless system
One of the best ways to make sure that your ledger stays organized is by transitioning into a paperless system. Going paperless cuts out logistical challenges, makes sure your invoices aren’t lost, and speeds up the AR process overall.
2) Incentivize Early Payments
Encouraging customers to pay early is one of the best methods to avoid outstanding AR. Set up a system where customers get a discount or benefit if they pay early. Late payments aren’t always malicious—sometimes, clients just forget. Offer an incentive and that won’t happen.
3) Automate Invoicing
Automation in accounting is great whenever possible. AR automation tools come with a huge range of benefits, including:
- Creation of recurring invoice schedules
- Automatic customer reminders
- Internal company reminders
Interested in Learning More About Improving Your AR?
Read our blog to learn more about how to improve your AR
Need Help With Mid-Sized or Small Business Recovery? Rapid Collections Can Help!
If your accounting has struggled to adjust to the post-pandemic world, turn to Rapid Collections! Whether you need AR small business recovery or corporate recovery, we provide effective, ethical collections solutions. Contact us today to take your AR where it needs to be.