Businesses dealing with shifting pandemic conditions shouldn’t write their plans in stone

All through the Great Pandemic of 2020 — which, although it feels as though it has dominated our lives for ages has really been the controlling influence for barely four months — the prevailing hope was that facemasks, hand sanitizer, social distancing, sending workers home, closing up stores, and summer heat would knock down the virus by the start of the school year at the latest.

The business survival strategy based on that timetable called for owners and executives to slash spending where possible, keep revenue coming in even if it meant a radical departure from normal operating procedures, grab whatever grant and loan assistance was out there, beg the indulgence of landlords and suppliers, drain whatever savings might be put aside and hope that would be enough to limp through to the end of the year and recovery to more normal conditions.

Depending on the sector and the severity of the hit, that strategy was sufficient to keep some in business. Others with thin capital and even thinner margins couldn’t wait coronavirus out and made the decision to close permanently.

With the unhappy news and disquieting trends of the last two weeks, it may be time to come up with Survival Strategy Plan B.

Actually, given how frequently and dramatically the situation and the information on how to cope with Covid-19 has changed, most businesses are much further down the alphabet, to plan J or M or even Q. From plotting how to hold on until midsummer at the latest, now businesses are wondering how they’ll manage if there’s no improvement by this fall, the holiday season or – yikes – ever.

And never mind conditions improving or even stabilizing, now businesses and their customers have to worry about conditions getting worse, which they are with a surge of cases in much of the country. That raises the specter that not only will the lifting of official restrictions on business operations be postponed, more restrictive rules that had been relaxed might be reimposed. It happened in California. It’s on the table for discussion here in Washington.

Calendars had already been wiped clean of events from mid-March until now, but the cancellations are creeping even deeper into 2020. The Washington State Fair in Puyallup decided to skip this year. The first few weeks of college football season have been lopped off; some smaller schools and conferences have scuttled the entire year, and even for the majors the remaining schedule of games is looking none too assured.

A whole lot of parents, teachers and administrators are skeptical of the notion of a return to traditional, classroom-based school come Labor Day.

Some business meetings that were optimistically rescheduled from earlier this year to fall are now imperiled, and it won’t be long before widespread postponements and cancellations start removing events from the 2021 calendar. (It’s already happening to scattered events such as the Rose Parade on New Year’s Day in Pasadena, which is a no-go for 2021.)

That’s not just because the pandemic may still be at large at the time of the event itself; larger, longer meetings and events require weeks of preparation — as in, right now.

Every week has been a crucial one during the coronavirus saga, but the next two will be especially significant. If there’s no sign of improvement by the end of July, and about as much certainty as to when there will be as there is now, decisions will have to be made, and they won’t be pleasant ones.

Here’s what’s likely to happen if that’s the case:

• The pandemic recession will be even longer and deeper. Yes there are segments of the economy that are doing well, and some laid-off workers have been recalled to their jobs. But the full impact of permanent cuts such as in aerospace has yet to be felt, and some cuts, such as state and local spending, have yet to take hold. Huge sums of wealth and income have been taken out of the economy. Those losses will be a drag on recovery for years to come.
• More businesses will decide they’ve run out of time and money and close. Even if previous survival strategies kept the doors marginally open, they won’t work indefinitely, and with no prospect of a recovery all that staying in business achieves is a larger bill when the moment of reckoning inevitably arrives.
  
  
• The longer disruption persists, the more likely it is that the temporary way of operating becomes the permanent, new-normal mode. Online and delivery, work from home, Zoom conferences rather than business conferences and travel — eventually business managers will focus their attention on developing and mastering these new strategies and models, rather than waiting for the return of an operating environment that may take years, if it returns at all.
  
  

Covid-19 trashed the budgets and business plans so carefully prepared last year for 2020. Now it’s done the same for plans written earlier this year for the rest of 2020.

Businesses always need a plan, so it’s time to get rewriting – again. They’d be advised, however, not to get too emotionally attached to whatever they come up with.

Recent events suggest they’ll be at it again before long.

Bill Virgin is editor and publisher of Washington Manufacturing Alert and Pacific Northwest Rail News. He can be reached at bill.virgin@yahoo.com.