As the CEO of a 108-year old bank, I’ve found myself thinking a lot about what leaders who sat in my chair during the Dust Bowl, Great Depression, two World Wars or on September 11th must have thought in those times. How did they help their team and their client base navigate these times of great unrest and uncertainty?  

2020 has been a year for the record books, certainly one of the most challenging in my lifetime. I don’t have all the answers. Like many banks, my team of bankers and I have been in the trenches with small businesses like never before and if providing some insight based on what I’ve seen working for others helps your small business in any way, then it was worth me taking a minute to jot down some notes. 

1. PPP Forgiveness: If your company took out a PPP loan, don’t wait to pay it off. We are telling our clients that borrowed over $150,000 to move forward and get it off their books by year end.

If you borrowed less than that commonly accepted threshold, watch for Congressional simplification soon. If they can’t get that through prior to the election, move forward with the current steps. Your bank should have a plan in place, so reach out to them sooner rather than later and get started. 

2. PPP Round Two: If you aren’t already following the stories about the anticipated round two of the Paycheck Protection Program, set some google alerts or notifications from CNBC or the Wall Street Journal. While the original PPP was imperfect, it was an elegant employment program, designed to assist small businesses for a 2-3 month COVID disruption, allowing them to keep their well-trained employees off the unemployment line.

As we all know, COVID didn’t let up this summer and in fact is strengthening heading into fall/flu season. While Congress debates this package, be proactive with your bank and see if it is a good fit for your business.

Another good reason to get your original PPP loan forgiven, it’s expected to be a requirement of applying for a second round of assistance. Additionally, your community banker can help you prepare in advance so your business can be at the front of the line, should another round open up.  

3. Credit has tightened and lines of credit or traditional loans are probably hard for you to come by: The Treasury anticipated this and designed the Main Street Lending Program as a viable alternative. If your bank is not participating in the Main Street Lending Program, speak with a bank that is.

There are more than 20 banks in Texas, including Vista, that would be great to reach out to for more information. As opposed to the PPP loans, Main Street Lending Program loans are not forgivable. Based on your 2019 EBITDA, they also have more stringent underwriting requirements, and take some time to apply, so if you are interested, better to start now than later.

Loans start at $250,000 and have favorable terms. This might be a good fit for your company if you were in good shape prior to COVID and expect a full recovery. A qualified lender that is providing these loans would be happy to help you evaluate the potential. 

4. Cash is King: By this point, you have probably already cut unnecessary expenses, but if not, do so quickly. Only you as a CEO/CFO can know if and when letting valuable team members go and other similar decisions are necessary to give your company a fighting chance to hire them back once we are past a “masked economy.”

We’ve seen businesses cut back their paid media and instead focus on grassroots ideas, personal touches and client retention efforts. Others have had success forgoing their commercial lease space and running their companies from their homes to save rent expenses.

Take pay cuts or forgo bonuses yourself as leaders if you can make ends meet and expenses like company retreats, Christmas events and other normal expenses can also be justifiably saved this year with the savings immediately going towards your bottom line. 

5. Pivot: We’ve seen restaurants pivot to serving pre-made donated meals to front-line workers. Jewelry companies pivot to making masks. Advertising agencies pivot to more public relations, digital and social efforts than ever before. Be creative.

How can you meet the new needs of your existing customers? And how can you solve problems for new clients as well? Solving problems for people probably got you into your business, so think like your clients and solve their new problems. 

6. Communicate With Your Creditors: It’s awkward, I know. But it’s absolutely critical. Call your landlord, your banker, your credit card company. Get on a first name basis with somebody there and keep them updated of your status and progress.

If you don’t have your banker’s cell phone, get a new banker. There is more room for grace if they know you and you are proactive. If they see you cutting expenses and paying everything you can, they are more likely to work with you towards your ultimate success.

What we know is this—putting your head in the sand and simply waiting for things to get better is not a viable strategy. The time to act is now. 

Some of the best, most recognizable brands were born in recessions. Adversity makes us all better and enables exceptional companies and leaders to stand out from the rest. Truly great entrepreneurs will always find a way. We believe in you and the greatest state in the greatest nation God gave man. We will all get through this and ultimately be better for it.

2021 is almost here and the best is yet to come. 

Views and opinions expressed by Voices contributors are their own. 

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