With tourism being one of the most adversely affected sectors in the economies of the world, it’s cold comfort for local tourism businesses to know that their peers elsewhere are equally badly affected by the COVID-19 pandemic.
This is a time for each and every business-owner in the sector to do whatever they can to ensure that their businesses survive. Understanding how crucial this is for both the future of the industry and for Capetonians at large, we at Cape Town Tourism (CTT) have focused on assisting our members in whatever ways we can, including putting together a Small Business Covid-19 Survival Checklist that provides helpful advice and guidance.
This checklist will also guide the development of business resilience and recovery plans ensuring businesses are ready when this crisis subsides.
1. Take control of your business and finances
Business-owners should speak to their banks, landlords, insurers, financial advisors, and any other parties they have financial commitments with. Check on your cash flow regularly, taking into account payments due to creditors (and the possibility of extended deadlines for payments) and money due to you from debtors. For instance, if a business has been a solid tenant in the past but does not currently have the cash flow to pay rent at the moment, discussing the current crunch with the landlord makes sense. Kagiso Mahlangu, a conveyancer from CMS South Africa, explains, “A landlord is likely to be flexible if a tenant was always a good payer in the past. Landlords would rather keep a good tenant, even if it means having to accept less revenue, rather than run the risk of having empty premises later on.”
In addition, with a range of financial support packages being made available by various organisations, there’s a chance that a business may get a financial injection to keep things going for a while. Business-owners should familiarize themselves with what is available and the processes required to access this financial assistance. Check websites such as the City of Cape Town, the UIF, and the National Department of Tourism, for instance, where you will find plenty of information about these resources.
2. Revise your business’s strategy
Management and staff have more time to plan and think about the business. Use this time to evaluate your existing business plan and see if it’s still appropriate for what is likely to happen once travel and tourism open up again. Consider things like: what the obstacles are preventing you from moving ahead with your business, and how you could try to overcome them; whether there are other services or products you could offer to the market (i.e. a restaurant that now offers take-aways and imported food products) and adapting your usual product or service to take account of the future demands for heightened health and safety practices. Keep discussing your thinking with your staff – some of them may be able to contribute ideas to enhance your new plans and, by involving them, you are likely to find greater loyalty to the business among the staff.
3. Remain fully compliant with the legalities
Stay informed about legal requirements that your business usually faces, such as tax deadlines and submissions of PAYE payments. If you are able to defer PAYE and provisional tax payments without incurring interest charges, this can be helpful for your cash flow situation. Take advantage of any flexibility offered by your credit providers as penalties for non-compliance can have a negative effect on your cash flow.
4. Focus on skills development
With extra time on your hands, both you and your staff are well-placed to improve the skills set your business offers. Work out what skills should be enhanced in order to help you cope with the new realities in your business. Communicate with your employees frequently, ensuring that communication is honest. Use Zoom or Microsoft Office Teams to stay in touch with staff, brainstorm new ideas or upskill/mentor one another. Many organisations are offering educational webinars for free – tune into relevant sessions that discuss issues and solutions within your industry.
5. Stay connected and keep your brand alive
Continue talking to your existing customer base and to prospective new customers. Keep people updated via your company website and send out regular emailers to your database – this reminds them that you’re still around. Social media can develop a stronger connection with your customers, communicate information about your product offering, giveaways, promotions, virtual experiences and any business updates that’ll be good for the public to know. You will also need to develop a marketing plan for the first few months after lockdown is over. In all likelihood, this will be shaped by the issues that COVID-19 necessitates, such as social distancing, sanitising, smaller groups of people, etc.
As dismal as things may seem right now, we all know that, at some point in the future, travel will become popular again. Keeping the doors open for now is every tourism business’ goal so that they can yet again reap the rewards of this vibrant sector of the economy.