In light of the coronavirus outbreak, the impact on many small businesses has been devastating, especially when it comes to cash flow.

I was watching the business news and I saw the CEO of Uber being interviewed about how he is dealing with the outbreak of Covid-19 and the effect on the ride share business. He said “ the company had a cash cushion of $4 billion dollars.” Imagine that; a $4 billion cash cushion.

Right now, most small businesses, especially franchises and Bricks and Mortar retail are having to make really hard decisions about whether to:

  • Lay off employees
  • Reduce store hours or
  • Close the doors of their business

These are just a few of the very hard decisions small businesses have to make,  because most small businesses do not have a cash cushion-especially one of $4 billion dollars!

Everyday, the news report is about major multi national corporations such Air Canada, TJX which is Winners or Homesense or Loblaws. These are companies which operate multi-million dollar or billion dollar business. They also have investors and major shareholders that they have to report to. Having a cash cushion is expected.

Small businesses are literally just trying to figure out how to make payroll, how to pay their suppliers, and simply how to keep their doors open. Small business owners should become their own stakeholders and pay close attention to their bottomline.


 When you use your GPS or navigation system- if you make a mistake, it always says “recalculating”. So regardless of where you are at today, the key is to have a plan once we get through this.

Cash is Queen and King! Operating a business with extra cash is going to be relevant moving forward.  Cash can come from different sources and be used for different things. Not all cash is created equally!

There are 3 types of Cash:

  1. Operating Cash can be generated from sales and account receivables. This can be used for paying expenses or account payables.
  2. Investing Cash is generated by selling certain assets and can be used to buy certain assets such as vehicles and real estate or equipments.
  3. The third is Financing Cash which can be generated by borrowing money from the bank or by raising money from investors. The money is then repaid to the bank and investors.

All three forms of cash are necessary- however the most important is operating cash flow.  In order to be sustainable, your business must be able to produce positive cash flow from the operations of the business.

When your business run out of cash it, will fail.

To keep the doors open its critical to maximize cash and cashflow.

Once this pandemic is over it is a good idea to know the numbers in your business. Work with a business coach or consultant to help you create a plan.

Business Continuity Plan

 If you are able to weather the storm and you had cash set aside to weather the storm-Congratulations!

If you do not have money set aside and you are concerned about what to do, it is important to tap into government relief programs that are available.

Most banks are offering a 6 month deferral on loans or lines of credit.  Corporate taxes are delayed in some provinces. Take the time to tap into these programs.

Your business may not be Uber, but we can learn some of their tactics. Putting money away and having a “cash cushion” should not only be for big businesses.

How is your business dealing with the pandemic?