Editor's note: In early March, Inc. reported on how small companies across the U.S. were preparing for disruptions related to the coronavirus outbreak. Here's an update on the steps they're taking to respond to the rapidly changing business environment.
PMsquare: Moving online
The 33-employee data and analytics company, based in Oak Brook, Illinois, has moved almost entirely online. The transition, managing partner Dustin Adkison says, has been relatively easy--especially after he wrote personalized notes explaining the situation to his clients, who are used to onsite visits from PMsquare staffers. In addition:
He's recommending that his employees work from home, but keeping the office open (and regularly sanitized) in case anyone needs a safe and quiet work environment. So far, only Adkison himself and one other employee have tried it, stationing themselves on opposite sides of the 4,600-square-foot space.
The company has added a paid family leave benefit, in addition to its sick leave policy, allowing workers to take time to care for children or other relatives.
Adkison set aside six months of cash reserves for the business, and is exploring other contingency plans like obtaining a line of credit in order to keep his team together. His top priority, he says, is to avoid layoffs.
Pacific Manufacturing: Cutting costs
Recently, founder and CEO Harold Robison sent his six San Diego-based employees home for a remote-work test run. The test quickly became permanent, with workers now relying on collaboration tools like Zoom, Slack, and Asana. Robison says working from home has been easier than he expected, partially because of the unfortunate fact that business has slowed down significantly. Here's what else is happening at the private-label sock company:
Pacific Manufacturing's sister sock company Injinji (with which it shares its main investor) is also struggling, so the two are combining resources: For example, Robison is now using Injinji's warehouse to ship his orders.
Robison is running stress tests--for instance, projecting cash flow if clients were to pay him within 90 days, instead of 30 days--to help more accurately predict the hit to his financials. His early March prediction of a 15 percent drop in 2020 revenue has grown to 25 or 30 percent.
Robison is putting together a list of ways to cut external spending to avoid potential layoffs. "We're focusing on safety, compassion, and productivity, in that order," he says. The company's plan B is a line of credit. Robison predicts that business will return to normal within the next 60 days--but he had also put aside six months of cash reserves prior to the pandemic, just in case.
Wonderffle: Focusing on products amid uncertainty
It's been a volatile few days for Mike Bradford, the founder and sole employee of stuffed-waffle iron company Wonderffle. First, he learned that his target date for receiving new inventory from China--mid-April--was inaccurate. Now, he's not expecting product until June--and even that's uncertain. The Pflugerville, Texas-based startup has seen additional developments, too:
Bradford is cutting his marketing and R&D budgets to make sure cash remains available over the next few months. The $15,000 he'd previously apportioned to create a prototype for his next product line is now down to $8,000.
The budget cut means the prototype can't be fully functional. Bradford's creative (and significantly less expensive) workaround: making the base product out of metal, and 3-D-printing the ancillary pieces to show potential partners how it would work when mass manufactured.
Bradford says he doesn't have a long-term plan yet, because it's still tough to predict how long his present situation will last. "It's slowly moving along," he says. "I hope I'm making some progress, but the pace seems glacial."