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5 ideas for reinventing your business right now

According to a Small Business Trends survey in July, 92% of small businesses in the U.S. have had to reinvent themselves over the past few months. Are you one of them? If not, your struggling business may need to be next. Where do you begin? It starts with hustle, as usual.

Here are five considerations to keep in mind during challenging times:

1. Play to the new market realities. The businesses that have survived, or even thrived, over the past few months are those that immediately pivoted towards new market realities. For example, a catering company might have little chance in a locked-down world, but food delivery services picked right up.“The main thing was to try and grab any type of creative demand that came about from the lockdown,” according to one Florida-based caterer.

You might have to pivot more than once. When restaurants began offering food delivery, the catering company lost out to competitors with greater name recognition. Now, they’re providing meals at Zoom events and working with school lunch programs. Soon, they hope to get back into event catering again, as that business picks up.

If your business hasn’t shifted to e-commerce or offered a different mix of products and services based on new market realities, you may not be able to compete.

2. Consider changing banks. If you didn’t get enough help from the Paycheck Protection Program, you may have lost faith in your bank. Now, smaller banks and fintech companies are stepping up to provide funding for small businesses. Take the time and effort to transferring to a new bank now and you might see greater opportunities and better service from a new banking solution.

3. Expand your financing sources. A lot of businesses have gotten creative about financing. Some have gone so far as to initiate GoFundMe campaigns to stay afloat, but there are still more traditional sources of funding available, if you know where to look. Consider these three programs: The Small Business Administration’s Economic Injury Disaster Loan Program, the Federal Reserve’s Main Street Lending Program, and Community Development Financial Institution Loans.

Other options may include selling stock, if you are a corporation, or seeking a private equity investor who could recognize the fundamental soundness of your business model.

4. Motivate with non-financial rewards. You may be struggling to motivate your team without a great deal of money on hand for financial rewards. Keep in mind that there are less costly options that may still express your appreciation. For example, awards, extra days off, professional development opportunities, offering time for passion projects and flexible work arrangements can be very satisfying to employees with no long-term financial commitment.

5. Consider restructuring through Chapter 11. If your best option for saving your company involves taking on debt you can’t afford, you may wish to consider filing for Chapter 11 bankruptcy to reorganize your company and shed excess debt. If you believe your business is fundamentally sound but you can’t keep up with your bills, a Chapter 11 bankruptcy could allow you to come up with a reasonable payment plan you can afford in the meantime.

The CARES Act expanded a Small Business Reorganization Act (SBRA) provision that allows you to spread out your Chapter 11 administrative fees over three to five years instead of paying them up-front.

Many companies are in the position of being fundamentally sound while being unable to make things work in the current challenging environment. A business law attorney may be able to help you streamline your operations and cut costs while you continue to operate.