Small business survival guide for weathering the coronavirus

13 min read
Doug Bonderud

The coronavirus (COVID-19) is causing significant disruption across Canada. Citizens are advised to practice “social distancing” to slow the spread of the disease, provinces are quickly closing public facilities and on March 16th, Prime Minister Justin Trudeau closed Canada’s borders. If you own or manage a small business, don’t panic. Consider this your small business survival guide.

Get the latest updates on the Canadian government’s coronavirus website.

For businesses, the rapid spread and increasing severity of this coronavirus outbreak prompts rising concerns:

  • How can small ventures best respond to the pandemic?
  • What government resources are available to small businesses (Canada’s COVID-19 Economic Response Plan)?
  • Are there any partnerships or programs to help ease the financial impact?

And most importantly, what steps can businesses take right now to reduce their risk and continue operations?

We’ve got you covered in our one-stop survival guide for outbreak operations.

4 things you can do right now

In times of crisis it can be hard to think clearly about what to do first. So here’s a short list for any Canadian business:

  1. Create a business continuity plan.
  2. Account for line-of-business impacts.
  3. Plan for the impact on people.
  4. Beef up your digital channels of communication

Take a deep breath and remember: you’re not alone. Right now, in countless rooms around the world, small business owners are all doing the same thing — rolling up their sleeves and making plans.

What to expect during a pandemic

According to an open letter from more than 30 Canadian business leaders, both public and private organizations should:

“... immediately shift focus to the singular objective of slowing the pace of transmission of this coronavirus.”

Survival Guide Woman Wearing Facemask Walking Alone
Stopping the spread of COVID-19 is our first priority.

Along with an emphasis on social distancing as the most effective method to slow the spread of COVID-19 (more on this later), businesses must quickly create and put in place plans to keep staff and patrons safe and help ensure continuity of operations.

A recent guide from the Canadian Chamber of Commerce notes that businesses must be prepared for:

  • Worker absences
  • Service and supply disruptions
  • Rapid demand increases for some businesses, with rapid drop offs for others
  • Cancellation of travel and public meetings
  • Increased public fear

As a result, it’s critical for companies to deploy four key strategies:

1. Create a business continuity plan

For those who are new to continuity planning, this includes:

  • Creating a chain of decision-making that spells out who’s responsible for what
  • Identifying key business assets — such as financial documents and business records
  • Regularly communicating with customers and stakeholders about current conditions

You can find a continuity plan template here. As you fill it out, keep these suggestions in mind:

Adopt a customer-first approach

Your customers still want and need your products and services, but it may become harder for them to get to them. So think about how you can adapt your offerings to help them survive the COVID-19 crisis.

First off, consider switching to virtual meetups and video conferences. Check out free tools such as Google Hangouts and YouTube Live or paid tools like Zoom. If you’re hosting an event or other large gathering that must be held in a physical location, consider delaying and/or offering refunds or credits.

Canadian businesses are showing ingenuity in the face of strong headwinds.

Survival Guide Type Books

Here are a few examples of how small businesses are getting creative about serving their customers:

  • Ryde YXE, a spin studio in Saskatoon, is exploring sharing workouts online while its two studios are closed. As of this writing, local coffee shop D’Lish by Tish was still open but adding a drive-thru and delivery service to offset a drop in foot traffic.
  • Businesses in Winnipeg are doing their part by reducing hours to help limit the spread of infection while still generating revenue.
  • While Toronto’s Queen Street location of Type Books has closed its doors to foot traffic, it is accepting phone orders and making curbside deliveries to Toronto’s west end.

Needless to say, the situation is fluid and business owers will have to hustle to keep up with governmental restrictions and supply chain limits as they learn of them.

Be alert to closures that might impact your operations

For example, school closures will likely impact childcare providers who operate in line with the local school district’s schedule. This will, in turn, impact your employees’ ability to do their jobs.

If you rely on a single global supplier, now would be a good time to research viable suppliers who might be able to step in if needed. Diversifying your supply chain is a good thing and will serve you long after this crisis has passed (more on this later).

Find out what kind of financial help is available

According to a recent survey of 8,730 companies by the Canadian Federation of Independent Business, about half of Canada's small businesses have already seen a drop in sales due to the effects of COVID-19.

Roughly 43% of businesses have reduced staff hours, 20% have begun temporary layoffs and 38% have had supply chain issues.

The federal government has already committed more than $1 billion to public health measures, including repatriation of Canadians. A full one-quarter of that $1 billion will go toward research for a vaccine, estimated by health officials to be at least a year away.

But the best news for small business came from Minister of Finance Bill Morneau on March 18, 2020. The Canadian government is committing $55 billion to businesses to help stabilize the economy. This includes:

3-month wage subsidy

The government is offering a 10% wage subsidy for the next three months, up to $25,000 per employer.

Delayed tax deadlines

Survival Guide You Got This Sign

Both the corporate and personal income tax filing deadlines have been extended to June 1, 2020, with payments not due until September 1, 2020. The goal is to keep this money flowing freely in our economy.

Expanded business credit

The Business Credit Availability Program (BCAP) is offering more than $10 billion in credit to help businesses continue operations both at home and abroad. The government is prepared to provide additional financial support as needed.

As a result, both Business Development Bank of Canada (BDC) and Export Development Canada (EDC) have announced new options for entrepreneurs impacted by the coronavirus.

Businesses can apply to BDC for up to $100,000, along with working capital loans and purchase order financing.

Both EDC and BDC are developing a tailored set of tools for the hardest-hit industries such as air transportation and the oil and gas sector. Contact them for details.

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2. Account for line-of-business impacts

Businesses must also consider supply lines and demand curves. Those who rely on Chinese imports have been impacted by the virus-related manufacturing closings there.

The Port of Vancouver reported container volumes down 13% in January, while the Port of Los Angeles, another major gateway to the continent's manufacturing sector and retail distribution networks, saw a 25% drop in February.

As public concern grows, demand for specific products or services may rapidly increase even as supply diminishes.

Survival Guide Person Preparing Box for Mailing
Your supply and demand cycles could be unpredictable for a while.

It’s critical to have a plan in place — such as limiting per-customer purchases or obtaining extra inventory where possible — to offset negative impacts.

Businesses must also account for potential closure by ensuring they have enough cash on hand or credit available to cover weeks — or months — of partial or complete closures.

  • Work with a financial professional, if necessary, to work up a cash flow forecast.
  • Contact the BDC, EDC and/or local lenders for help securing credit.

Between government relief efforts and private support, small businesses can begin to map a way forward.

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3. Plan for the impact on people

While robust infection control procedures can help limit the spread of coronavirus, you’ll want to plan for potential impact on your own personnel.

The government recommends social distancing, ranging from simply avoiding crowds to mandatory quarantine for those who’ve been diagnosed with COVID-19.

Provide a FAQ sheet to keep your workers updated with coronavirus news, including a link to this page. Make sure your employees know what benefits they’re entitled to — this will lessen their anxiety. Recent relief initiatives include:

Individual and family aid

The government is offering a GST credit close to $400 for single people and $600 for families. People with children will also receive a child benefit (TAPA) of $300 per child. Employment Insurance coverage has also been extended to 14 weeks.

Mortgage payment deferral

The country’s six biggest banks are offering deferral of mortgage payments for up to six months. Tell your employees to contact their banks directly for details.

Student loan payback deferral

There is a six-month interest-free moratorium on Canadian student loan paybacks.

Tax filing and payment extensions

The personal income tax filing deadline is now June 1, 2020, and the payment deadline is September 1, 2020. It’s worth noting for workers that the earlier they get their returns in, the quicker they’ll get their refunds.

Expanded Emergency Care Benefit

Those who are laid off or forced out of work because they are sick or caring for a sick family member and don’t qualify for Employment Insurance (EI) will receive the same benefits offered by EI.

Freelancers, part-time workers, the self employed, gig economy and cultural workers — all will receive $900 every two weeks for up to 15 weeks.

Starting early April Canadians can apply online and receive payment via direct deposit. No medical documentation will be required.

Other relief efforts

The government has temporarily reduced minimum withdrawal on registered retirement income funds by 25%. OAS and GIS payments will continue as usual without interruption.

The government is also increasing support for the homeless and indigenous populations — details to come.

Staffing changes

It’s also a good idea to rethink your roster, with an eye toward spreading employees apart to slow the spread of the virus:

  • Wherever possible, workers should be encouraged to work from home
  • In-store staffing should be kept at minimum levels to reduce the risk of virus transmission

Despite best efforts, businesses must also be prepared for staff absences due to illness, childcare concerns or personal challenges.

This is a good time to review your sick leave policy

All SMBs should review and update sick leave policies to comply with federal and provincial guidelines.

The government has waived the one-week waiting period to access EI sickness benefits.

Check your provincial guidelines (find links below) for any changes. For example, employees in Alberta are now entitled to 14 days of job-protected leave without a medical note, and the 90-day requirement for new employees has been waived.

There are also other changes to EI Sickness Benefits for those diagnosed with COVID-19.

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4. Beef up your digital channels of communication

The beauty of digital communications is that the tools are easily accessible to nearly everyone. And while an email or text can’t replicate your handshake, it won’t make anyone sick.

Keep your social media profiles updated

Social media is a great place to share business changes related to COVID-19 and answers to common concerns that customers have expressed. Keeping up with customer queries can be time-consuming so use a tool like Hootsuite to help you manage all your social accounts from one dashboard.

Online business listings

This will only take a few minutes, so be sure to update your Google My Business and Yelp listings, including any changes to business hours, services, etc. Make a mental note to revisit these sites if your hours or offerings change.

Create a communications hub

If you don’t yet have a website for your business, think about standing up even a one-page site to share important information with your customers.

Already have a website? Add an update to your home page about what you’re doing to keep your customers safe and your products or services coming during the coronavirus crisis. Be sure to note any changes you’re making to services or refund policies.

Start collecting email addresses

Survival Guide Man Reading Cell Phone

Email is an excellent way to connect with customers, whether you’re sharing news of changes in your operating hours or announcing a new drive-through or delivery option.

But before you can send your first email, you’ll need customers to voluntarily give you their email addresses. This can be accomplished by adding a signup form to your website, social media page or blog. Most reputable email tools make this easy.

Text is also a good way to keep the lines open and there are a number of tools available to get you up and running with SMS.

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Additional survival guide tips

It’s definitely worth spending a few minutes researching local SMB relief efforts. In addition to the mortgage payment deferrals mentioned above, some creditors are offering:

  • Special payment arrangements
  • Loan payment deferrals
  • Skip-a-payment programs

Check with your creditors to see what they can do to help keep your doors open.

Ottawa Mayor Jim Watson says his staff is looking at ways to support locally-owned shops and restaurants, including the possibility of tax deferral measures to help them with their cash flow and payroll commitments. Chances are good your province has special programs as well.

Corporations pay it forward

Private corporations are also helping Canadian small businesses weather the coronavirus storm. As noted by The Globe and Mail, several internet providers are temporarily removing data caps on business and personal internet plans to help staff work from home and avoid overages. Current participants include:

  • Rogers
  • Telus
  • Videotron
  • TekSavvy
  • Distributel

The Open for Business Hub, meanwhile, lists technology providers — from Google and Microsoft to Box and Cloudflare — that are offering free or discounted services to enable remote work.

Resources by province

Before we get to the links to provincial resources, bookmark the government’s site as well as the World Health Organization (WHO) website to stay ahead of best practices as the COVID-19 crisis evolves.

Canadian provinces are taking action to keep citizens safe, which includes closing some public institutions.

The breadth and depth of these closures could impact your business, so it’s worth staying up-to-date with the strategy in your province:

Along with staying current about emerging province-wide policies, there are also opportunities for Canadian small businesses to adapt their business models.

Tip: Add a news alert for your favorite online source(s) to get the latest COVID-19 news.

The business bottom line

There’s no way around it: The coronavirus outbreak will significantly impact businesses of all sizes across the country.

But it’s not all bad news. With a plan in place and access to the right combination of public and private resources, it’s possible for Canadian small businesses to streamline their operations, reduce risk and weather the storm.

Information was accurate as of the time of publication. Consult the government website for up-to-the-minute changes.

GoDaddy Editor Cate Barker contributed to this post.