During the 2020 Spring Festival,The pneumonia epidemic quickly spread throughout the country. The whole country has jointly fought against the epidemic and taken multiple prevention and control measures. The epidemic has disrupted the traditional Chinese Spring Festival holiday and had a huge impact on the operation of the Chinese economy.

For enterprises, they usually formulate a business plan for the new year before the Spring Festival and start to get ready, eager to try and look forward to major breakthroughs in the new year's business. But this pneumonia epidemic has disrupted the plans of enterprises. Due to nationwide epidemic control, most of the businesses have almost come to a halt, which means that the enterprises cannot obtain new cash flow during this period.

At the same time as business shutdown and cash flow interruption, enterprises also need to bear huge employee salaries and office rental expenses. Some enterprises with large inventory of products will also face huge inventory depreciation risks.

If the epidemic can end in a short period of time, enterprises can still digest it, but if the epidemic spreads for a long time, it will be difficult for enterprises to support themselves, making business operators the most worried group besides patients in this pneumonia epidemic.

How should companies respond to the epidemic?　　

01

Adjust mindset and actively respond to crises

The impact of the epidemic is indeed causing anxiety, but if the environment becomes a business condition, business operators need to face reality, adjust their mentality, and actively participate in the self rescue work of the enterprise now, rather than blaming the world or passively waiting.

I firmly believe that the development of a company is the most important, and that the self growth of a company should not be influenced by the environment.Companies with over 100 years of history may be in a benign environment or in an environment full of crises; It may be in a high growth field, or it may be in an industry where growth has already stagnated.

However, these leading companies have achieved growth in line with their peers through their own hard work, year after year. Whether the economy is in a period of prosperity or decline, maintaining growth is their unwavering belief.

Different attitudes can lead to vastly different self rescue outcomes. After the end of the epidemic, companies that are well prepared and do not blame others will be able to quickly resume normal operations, and even achieve development results beyond those before the epidemicAnd those companies that are in panic, only complaining and passively waiting, may collapse in this epidemic.

02

Organize funds, count inventory reserves

In situations where new cash inflows cannot be obtained through the sale of goods, the current available inventory cash reserves of the enterprise become its most important asset.

Enterprise operators need to systematically inventory the available cash reserves of the enterprise, as well as the fixed monthly employee salaries, housing rental expenses, and bank principal and interest payments that need to be repaid in the future, in order to have a clear understanding, formulate a detailed plan for the use of funds, strictly eliminate all unnecessary cash expenditures, and ensure that the enterprise has sufficient funds to resume operations after the end of the epidemic.

In addition, business operators should continue to monitor the progress of the epidemic. If the company's cash reserves are unable to support its expenses during a long period of the epidemic, it is necessary to communicate with employees, suppliers, banks and other relevant parties in advance to reach mutual understanding agreements. For example, companies can negotiate with employees who are working full-time at home to determine whether they can only pay basic wages that ensure their livelihood during the epidemic period;

03

Reduce costs and maintain cash flow

Challenge the limits of cost reduction, declare a community of shared interests, transparent basic income and expenditure, and unite entrepreneurs and employees to overcome difficulties together. Especially for small and medium-sized enterprises, their fundamental purpose is only one,We hope that small and medium-sized enterprises can maintain their cash flow.　　

For enterprises with good cash flow, they also need to restructure their cost capability, as dealing with uncertainty is a normal ability. However, at the same time, capable enterprises, in the context of the epidemic, quickly focus on how to do "subtraction" while also paying attention to "addition", that is, how to focus on real customer value and create customer value.

04

Seize the moment and do a good job in business addition and subtraction

Although the main revenue of the enterprise will be greatly affected by the epidemic, the enterprise still needs to sort out the business points that may generate revenue during the epidemic period and fully utilize the resilience of supply chain management. Deeply understand the importance of mutual benefit and negotiate with upstream and downstream suppliers. Compressing profits and even sharing losses equally is a mutually beneficial and win-win behavior during this special period. Even if the revenue contributed by this part of the business is insignificant, enterprises still need to pay attention to it.

It should be acknowledged that if a clear direction can be found and investment increased during a crisis, the growth obtained afterwards will be incalculable.　　

In times of crisis, adding and subtracting changes to the business structure enables the company to have a more effective ability to dynamically respond to uncertainty. On the one hand, the revenue from this part of the business can play a critical role during critical periods, and on the other hand, it can drive the normal operation of various business functions within the enterprise organization, ensuring seamless connection and rapid resumption of normal operations after the epidemic.

05

Plan for the long term and seek new growth points

The business shutdown of the enterprise is mainly due to the decline of customer demand during the epidemic period. Therefore, even if the enterprise makes more efforts, it cannot have a substantial impact on short-term performance. Therefore, in addition to grasping some business points that may generate income as much as possible, it is more important for the enterprise to prepare for long-term development after the epidemic.

For example, make full use of the Internet platform, make good use of the appropriate SME management APP, and accelerate the online management of logistics, marketing, and even finance, accounting, personnel, quality, etc.

In addition, during the epidemic, there are also certain business possibilities in online and overseas markets.Enterprises often focus on short-term cash flow business in their daily operations and lack the determination to break through their business comfort zone. Therefore, this time they can make efforts to turn crisis into opportunity. Enterprises that have mainly relied on offline business in the past can try to develop online business, while enterprises that mainly focus on domestic business can take the opportunity to explore overseas markets .....

For example, in 2003, affected by SARS, JD.com closed all its offline stores and shifted its focus to online sales, successfully transforming into an e-commerce enterprise and seizing the great development of China's e-commerce industry.

The impact of the epidemic on the Chinese economy is temporary, and the fundamentals of long-term positive and high-quality growth in the Chinese economy have not changed.From the perspective of internal and external environment, positive factors in economic development are increasing, and the inherent resilience of the economy is strengthening, which supports the stable operation of financial markets. We should uphold the concept of long-term investment and value investment, summarize and draw on historical experience, and avoid the unnecessary impact of irrational emotions on the financial market.

We cannot accurately predict the future trend of this epidemic, but we are confident and capable of dealing with the possible impact of the epidemic, achieving victory in epidemic prevention and control, and maintaining a good trend of long-term stable economic development.

For business operators carrying heavy burdens, what they need to do now is to take their respective positions and focus on their own responsibilitiesActively participate in the self rescue of enterprises, protect their own businesses, and quickly resume operations after the epidemic is over, stepping onto the right track, and helping the entire social system to achieve orderly operation at the fastest speed.