Whether Covid-19 has a second wave or smaller recurring outbreaks, one thing is clear, the worst may not be over. Right now, we are in the eye of the storm with a moment in time to adjust our businesses and prepare for the future.
Business Continuity Plan
You should work out a Business Continuity Plan from all the different positions in the practice. Here are some issues that should be addressed and possible solutions worked out ready to put in place:
• What would you do if you yourself as the practitioner have symptoms or test positive and have to self-isolate? Who will cover your in-person visits?
• Can you do some virtual visits from home?
• What happens if reception staff and any technical staff have to isolate? Possible back up staff or temps should be sourced out and lined up.
• How much PPE and cleaning supplies should you stockpile now?
• How will your practice absorb a drop in revenues if procedures are suspended again? (See Cost Reduction Plan below)
• Do you have remote access to patient files and your appointment schedules? Can you redirect your office phone?
• Have you sat down with each staff member individually and worked out what contingency plans THEY need to make in their personal lives to ensure availability for the practice? This should address childcare, elder care, schedules with other family members, and so on.
Building a Financial Cushion
A lot has been learned from the first lockdown of our businesses and reliance on government subsidization again may not be possible. Therefore, practices should have a financial cushion. Many, however, don’t have the funds for this, particularly after the loss of revenue during the lockdown period. Additionally, many practice owners found it necessary to access their LOC’s to handle practice renos to comply with new social distancing and patient safety guidelines, and so on.
As a result, available credit on the LOC or your Overdraft may be quite reduced. Getting your finances in order and adapting your business to new financial policies can help you better weather the storm.
Cost Reduction Plan
- Consider an overall cost reduction plan in order to create some surplus cash to pay down the LOC or Overdraft faster. What can be tightened up in the overhead expenses?
- Have a close look at your supply companies and their pricing and work to get the best deals possible, even if it means using a variety of suppliers for different products.
- Can you tighten up on staffing and hours needed?
- If your lease is coming due, this is the time to negotiate with your landlord as they are now much more “pliable” as a general rule. See if you can reduce your rent and/or get a free period.
- If it is feasible, can you repair any equipment that breaks down for now instead of ordering new?
- Ask your staff for any other ideas on cutting back overhead.
While you need to pay your current bills, concentrate on building a financial cushion by paying down your Line of Credit or Overdraft as fast as possible so there is a lot of room to access funds should a future practice closure be required. You want to have a cushion whether in cash or available credit.
By updating your Business Continuity Plan with all of the above, you will find that you’ll be in much better shape to make it through the second wave of Covid-19 should it happen. Apparently, there is a good chance that future pandemics will happen but taking the above precautions now will make it possible for you to survive in the best possible way.