Hello again. During this crisis, I am doing regular updates to keep small businesses and the self-employed informed of financial support, legislation, resources, and other help available to them.
Remember: I am doing a Facebook Live Monday to Thursday at 1pm EDT/10am PDT on Facebook to keep you updated and answer questions. And if someone forwarded you this newsletter, you can sign up here.
Most of these daily updates have dealt with loans and grants available to small businesses and the self-employed. But I’m here to help you keep your business afloat, alive, and to survive and thrive in all ways. You can find my previous daily updates here. And I will take questions about loans and grants during my Facebook Live session.
But right now…how about that stack of bills that are coming due now…
It’s the first of April, and that usually means a whole bunch of bills coming due—both for your business and for you personally. And right now, you might not have the money to pay them and any financial help you can get from the government won’t be here soon. So let’s talk about how to lower or delay some of these bills.
DO THIS SOON
It’s easier to get deferrals or reductions on bills if you contact vendors BEFORE you are in trouble. This is your job this week.
IDENTIFY YOUR BILLS: Collect the most recent statements of all accounts you pay regularly, not just monthly, but quarterly, semi-annually, and annually. These may be on your credit card bills—especially for services like website hosting and cloud-based applications. Contact the people you normally work with, such as a sales representative at a key vendor (for instance, in my business—a publishing company—it may be our book printer or distributor).
MAKE CALLS AND SEND EMAILS: For each account, call your sales representative, agent, or customer service, and do the following: Explain your situation: “my business is temporarily shut/reduced due to the coronavirus” (I’d use the term “temporarily” so as to indicate you’re going to be back in business) and ask to either or both lower your rate or defer payment.
UNDERSTAND YOUR VENDOR’S SITUATION: Some of your most important vendors are independent contractors and small businesses. They’re probably in the same boat as you. Try to pay their bills, meet their needs as much as possible. That big telecom company or website hosting company you use is in much better position to ride this out than they are.
BE COURTEOUS: Your vendor may be in the same situation you are—especially if they are a small business too.
NEGOTIATE: You don’t have to take the first “no” for an answer. Remember, a deferral or payment plan is also a good outcome for you now. Banks and big corporations have made public statements saying they’ll work with customers.
WHO’S MOST IMPORTANT: Identify who are your most important vendors and start talking to them NOW. This is especially true if you have independent contractors you depend on. Make sure you keep a good working relationship. And figure out which vendors you could do without if your business changes dramatically, and pay those last.
KEY FEDERAL LOAN/GRANT PROGRAMS FOR SMALL BUSINESS AND SELF-EMPLOYED
(I’ll take questions about these programs during my Facebook Live sessions, M-Th, 1pm EDT/10am PDT. Go here to join or to watch the recording later.)
A question I received in yesterday’s Facebook Live: Can I get a PPP loan (forgiveable) and another SBA loan at the same time—and the answer is YES. However, you cannot use the loan for the same expenses. For example, you could get a PPP loan and your forgiveable expenses are 8 weeks of your payroll costs, rent, and utilities. But you could also get an EIDL loan and use those funds for those same expenses outside of the 8-week period (such as payroll and rent) and to pay your other vendors and bills even during the 8-week forgiveness period.
Three of the most important ways to get Covid-19 relief funds for your business:
- Payroll Protection Plan (PPP): This loan may be FORGIVEABLE
- Economic Injury Disaster Loan: You may be able to get a $10,000 GRANT with this loan
- Unemployment Insurance: $600/week for up to four months for self-employed/independent contractors/gig workers
Find small business counseling in your area through the following organizations:
Copyright Rhonda Abrams, 2020