Starbucks Sign

How Businesses Have Reacted to Coronavirus

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Companies around the world are struggling to cope with the effects of coronavirus, with many forced to lay off staff due to closures as well as illness.

Like governments, the CEOs are trying to put together packages that will see not only the staff but also the business stay afloat. However the number of American citizens currently unemployed has hit numbers not seen before.

PayPal are one of the companies that have announced they will not be sacking any of their employees in relation to the pandemic. CEO Dan Schulman confirmed the move stating, “We don’t intend to do any layoffs as a result of covid-19. This is the right thing to step up, to make sure they know that we’ve got their back.” He continued, “If they’re sick, we pay them. If an office closes, we pay them. We really need to be sure that we have their health and their finances at heart as we deal with this crisis right now.”

Matt Murphy, CEO of Marvell Technology, has also confirmed there are currently ‘no plans’ for staff to lose their positions due to the pandemic. “I want the team to be totally focused on the mission at hand, which includes taking care of customers and their own families.”

Both companies join a list of organizations that have offered assurances to staff about job safety. Morgan Stanley, Bank of America and Starbucks have also tried to ease their staffs fears during the economic crisis that covid-19 has created throughout the world.

Brian Moynihan is CEO of BofA and backed his company’s stance saying “we don’t want our teammates to worry about their jobs during a time like this. We told them all, there’s no issue, you’re all going to be working now through year-end. No layoffs, no nothing.”

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Meanwhile James Gorman, Morgan Stanley’s CEO, sent his staff a memo announcing the company’s workforce will not be reduced as a result of coronavirus during 2020. And Starbucks’ CEO Kevin Johnson confirmed his company would continue to pay their staff for the next 30 days as America’s ‘stay-at-home’ orders have impacted their stores.

Alongside PayPal’s vow to retain their staff, the company has also pulled a plan together to help the business customers who use their service and have already seen their businesses struggle.

As well increasing the length of time merchants are allowed to respond to customer disputes and waiving the instant withdrawal fees on business accounts, they have also made a provision for all business customers to delay any repayments on cash advances or business loans – at no extra cost.

Schulman explains, “We’re basically trying to give small businesses the flexibility to deal with the issues they have right now. We’re one of the largest providers of working capital to small businesses, and we’re going to continue to provide that where we can.”

Schulman has also stated that he believes “companies that have a degree of financial strength” should be doing what they can to help employees and customers, enabling them to push through the global pandemic as painlessly as possible.

“We need to obviously take care of our shareholders, but I think the way we do that best is by taking care of our employees, taking care of our customers and stepping up and doing the right thing. That’s, I think, at least how we build businesses that are enduring and an economy that can be strong. And a strong economy is helpful for everybody.”

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Not all businesses have been so generous to their staff. An Amazon employee led a strike over the alleged conditions the company had been forcing their staff to work in during the outbreak, leading to the company firing him.

Assistant manager and organizer Clive Smalls led a walk out over protective equipment and salary demands however he discovered his contract had been terminated. “It’s a shame on them. To fire someone after five years for sticking up for people and trying to give them a voice.”

However Amazon dispute not only the reasons for Smalls’ termination but also his version of the walk out – Smalls’ claim 60 workers joined him while Amazon says only 15 did. They have even disputed his title amongst other things.

According to Amazon, Smalls failed to comply with company policy after coming into contact with an infected colleague. Something that Smalls also disputes. His termination is now being investigated by New York City’s human rights commissioner, as per the orders of New York’s mayor Bill de Blasio.

It is not just in America that companies are seeing their reputations improve – or become tarnished – over the way they have handled the situation. British tycoon billionaire Richard Branson has also been called into question. Following the grounding of all non-essential air travel Branson forced his staff to take an eight-week leave of absence, unpaid, leading to calls of boycotting the company when the sanctions are lifted.

However many retailers have been vocal of their support of their staff, particularly in countries that are in lockdown. Grocery store staff are seen as ‘key workers’ and as such are required to stay at work. Stores across the United Kingdom have been thanking their workers with bonuses, free lunches and vouchers.

Debenhams

UK Department Store Debenhams Enters Bankruptcy Due To Coronavirus

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The retail sector has been devastated by the impact of coronavirus and it appears that much loved UK department store Debenhams has become its latest victim as news circulates of possible bankruptcy.

Debenhams has been a familiar face on the UK high street for over 200 years, having originally launched in 1813 as a single store in London. However, they have been facing difficulties in recent years as the retail sector has evolved and competition has intensified. Last year, the company fell into administrations before it was rescued by its lenders and continued to trade, albeit at a reduced capacity. Currently, the business employs around 22,000 staff but it appears that coronavirus has delivered the final blow and it now seems that bankruptcy is inevitable.

Although the decision has not been finalised just yet, it has been reported that they are considering filing a formal notice of intention to appoint administrators next week. This is the first stage in the process and provides a brief window of opportunity for around 10 days, where creditors are not legally allowed to call in debts and is designed to provide time to find an appropriate rescue deal which could allow the company to continue trading.

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It is expected that the administration task will be handled by one of the ‘big four’ accounting firms, KPMG, who were involved in the highly publicised restructure of the company last year. It was taken over by a collective of financial backers including US hedge funds Silver Point and GoldenTree. Rents were then cut and unprofitable stores were closed as part of a company voluntary arrangement (CVA). In total around 22 stores were cut after the previous restructure with a further 28 planned to close in the coming months. This would have left around 113 stores still in operation.

A spokesperson for Debenhams was quoted as saying that all of those involved were ‘highly supportive’ of actions to help preserve the business, but it’s long term future remains unknown at this stage. For the meantime, the Debenhams website is fully operational and people can still place orders, submit product returns and spend gift vouchers. However, as with all precarious positions, it would be advisable to spend any vouchers or request returns as soon as possible to ensure that these can be processed as usual. Often, the final decision to cease business is made swiftly and without notice, so it is advisable not to leave and risk being left out of pocket.

Many experts are predicting that other retailers are likely to follow suit in the coming months as the uncertainty of coronavirus continues to impact the entire economy for at least the next few months. Very few retailers are likely to have sufficient funds to survive extended periods of store closures, and the government’s business interruption loans and staff retention schemes are unlikely to be enough to keep many above water. Another big name from the UK high street John Lewis has also said that it may keep a number of its stores permanently closed after lockdown after reports suggested that they lost around 65% of profits. House of Fraser also shut seven of its 59 branches prior to the lockdown announcement, so there are also fears that they too will fail to emerge on the other side of the crisis.

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Many retailers with strong online offerings are hoping that the continued postal and delivery services will help to retain sales during lockdown, but it is inevitable that the high street will be experiencing significant pain at this time. It was already a difficult sector to be in with rising rents and falling footfalls placing greater pressure on retailers to find ways to remain profitable. I think it is highly likely that the world we re-enter at the end of this outbreak is going to be very different to the one we left behind in March, in many ways.

Sadly, we probably need to accept that some of our much loved retailers, cafes, bars and restaurants simply aren’t going to be able to survive and we’ll need to bid our farewells. That said, the market will recover once the virus has run its course and there will be new and exciting opportunities for emerging brands and businesses to take their place. Whilst the retail market is unforgiving, it remains a strong and thriving sector with much opportunity. Smaller, more flexible retailers may well emerge and there is likely to be a significant national effort to support the regrowth of all sectors. Whether the big names will play a part in this remains to be seen, but there is little we can do at the moment but to sit and wait as the coronavirus continues to work its way mercilessly through our society.

Scholarship

Grad Who Earned $200K in Scholarships Starts Business To Help Others

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Justin Black and Alexis Lenderman officially launched The Scholarship Expert in December 2019 with the hope of helping all high school students in the U.S. find scholarships for college.

FLINT, MI– Flint native Alexis Lenderman earned more than $200,000 in scholarships as an undergraduate at Western Michigan University.

Growing up in foster care, Lenderman knew she wanted to go to college but had no idea how she was going to pay for it. After a lot of research and applications, she received 10 scholarships her freshman year, with a $10,000 refund.

Lenderman then went on to fund the rest of her college career, including eight study abroad programs, completely with scholarship money, earning more every year. Now as an alumna, she’s teaching others how to find scholarships and funding for college with her business, The Scholarship Expert.

 

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Coronavirus Symptoms

Amazon Stockpiling Inventory Because Of Coronavirus Risk

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Amazon reached out to a number of suppliers last week, placing last-minute orders to increase its inventory of products made in China, Business Insider has learned.

The move is intended to stockpile on certain products shipped from China, in anticipation of potential supply chain slowdowns caused by the coronavirus outbreak in the region, according to Amazon suppliers who spoke to Business Insider. The virus that originated in Wuhan, China, has killed more than 900 people and infected over 40,000, causing work stoppages and factory closures in the country.

“Amazon issued off-cycle orders to you last night in order to prepare for possible supply chain disruptions due to recent global events originating in China,” Amazon said in one of the emails viewed by Business Insider.

Amazon told these suppliers that the new orders are for products sold in the US but made in China, and that the change is in response to the coronavirus outbreak. In one of the emails viewed by Business Insider, Amazon said it’s placing “stock-up purchase orders for several weeks of supply,” and that it’s giving the suppliers 5 extra days to ship the products to Amazon’s warehouse. Amazon is also “proactively waiving” certain late shipment fees, the emails said.

The move reflects the urgency Amazon is working with to mitigate the impact of the coronavirus on its supply chain. About 40% of Amazon’s sales volume come from these first-party wholesale suppliers, with many of them depending on Chinese factories to source their products. Amazon previously told Reuters that the coronavirus is causing “no interruptions” to its operations.

In an email statement to Business Insider, Amazon’s representative confirmed the order increase, saying it’s a cautionary move.

“Out of an abundance of caution, we are working with suppliers to secure additional inventory to ensure we maintain our selection for customers,” it said.

It’s not the only change Amazon has made in response to the coronavirus outbreak.

Amazon notified its third-party sellers last week that it is aware of the virus and how it’s “impacting millions of individuals around the world,” according to a message to sellers seen by Business Insider. It said sellers should take precautions to make sure their sales performance is not impacted by the virus. The recommended precautions include cancelling previous orders that sellers are no longer able to deliver, placing their accounts in vacation status, or taking additional steps to manage inventory, the message said.

“We will consider this unforeseen event when we evaluate your account’s recent performance,” it said.

Amazon has also decided to pull out of this month’s Mobile World Congress in Barcelona due to concerns over the spread of the virus, Reuters reported Sunday. Amazon has made certain travel bans for employees going to China as well, Amazon’s CFO Brian Olsavsky said during a call with reporters last month.

“We’re watching it very carefully,” Olsavsky said during the call, referring to the coronavirus outbreak.

Amazon isn’t the only company affected by the outbreak. Apple warned investors in January about potential losses due to Chinese suppliers shutting down, while Disney said theme park closures in Shanghai and Hong Kong could reduce its profitability. Factories run by Tesla, Ford, and Nissan have also faced work stoppages due to the virus, according to the New York Times.

 

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Business Facebook

How to Rock Facebook For Businesses in 2020

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There are all sorts of social media platforms for brands and companies to incorporate into their marketing strategy, such as Twitter, TikTok and Instagram. However, one social media giant has kept its place at the top, and year after year acquires more and more users: Facebook.

According to Oberlo, there are 2.7 billion monthly users on Facebook and 74 percent of them log on daily. When using Facebook for business to its fullest potential, companies can create results that influence customer relations, brand awareness and increase sales. With this in mind, companies should definitely use this social media platform as part of their digital marketing strategy.

With the average Facebook user checking in several times each day, businesses need to make sure their page is appealing, organized and showcases the brand and its products or services in the best possible manner. What companies want to avoid is leaving the user confused and clicking away from their Facebook page.

To start, learn all about the features of a Facebook Business page and the free tools that assist with connecting to your audience. Take the time to understand how page sections help create a buzz about your business. As an example, if your company has regular social events, such as live music or meet the author nights, use the events page to share all the details about the event and invite followers. In the details section, don’t be vague or assume the reader knows why a band or an author is special. Tell them all they need to know (albeit briefly) to help them make a decision.

Tabs, which appear on the left-hand side of a Facebook business page, are extremely helpful with organizing. Pick and choose which tabs apply best to your business, like an About tab, Email tab, Shop tab, Services tab and Review tab. Also, share your brand’s other social media channels within these tabs (as long as they’re active). Doing so makes it super easy for users to be one click away from viewing your feed on their additional favorite social media accounts like Instagram, Twitter or Pinterest.

When using Facebook for business, many companies often neglect the Our Story section. Whether you are a small or large company, consumers want to know the story behind your business and why they should invest their time and money with you. While the About section has all the pertinent details like the business address, hours of operation, email, web address and mission statement, Our Story is the prime spot to share a more personalized version of ‘the why’ or the ‘core values’ behind your business.

No brand story is alike and it is in the Our Story section you can share exciting highlights of what makes your business stand out. Feel free to add a personal touch, such as communicating why your expertise or experience adds value to the company or the products or services it offers.

As an example, a business that creates handmade skincare and household products might have started because the owner’s child was allergic to store-bought brands and spent years perfecting its line.

Or, a company may use this section to explain the motivations behind a mission, such as a nonprofit who wants to share how their efforts have made an impact on them personally as well as for their cause.

Companies that might not have an interesting back story to share can use the Our Story page to highlight other aspects of the business, such as a positive company culture, the quality of product and top-notch customer service.

 

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The National Digest

Beyond The Brand: How These Two Women Help Small Food Businesses Stand Out

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There is no typical day for Amy Pastre and Country Rowson. The founders of SDCO Partners are the women behind the branding for countless independent food businesses around the country. Their roles fall into the category of “dream jobs” for anyone food-obsessed. Not only do they get to try tons of new products but they get visit pecan orchards in Georgia, CBD farms in California and more, all the while helping small food businesses stand out and scale.

“Oftentimes, farm-based businesses struggle with both educating the consumer and selling the product at the same time,” says Rowson. “It’s our job to help visually distill the information so that it’s easily digestible.”

Pastre and Rowson help small businesses, like Brightland, stand out and scale.

While the two have been business for more than a decade, not much about their process has changed since the day they founded SDCO. They still share an office and sit side-by-side, working and re-working a design solution until it’s just right. They two spend a lot of time talking to clients to identify challenges and opportunities before getting started.

“We ask our clients to participate in the process,” says Rowson. “Being open-minded at the start of every project allows us to conceptualize unique and relevant solutions.”

Both originally from the South (Pastre hails from Mississippi and Rowson from North Carolina), the two worked at various creative studios around the country before they each moved to Charleston in 2009, and opened Stitch Design Co. — now SDCO Partners.

Off Track Creamery is one of Pastre’s and Rowson’s many food clients.

“We were both living in Charleston at the time and met while working at other agencies. We enjoyed collaborating together and became fast friends,” says Pastre. “Our interests overlapped not just professionally, but also because of where we were in our respective lives. Several years went by, where we were having these conversations and enjoyed bouncing ideas off of one another. We started to realize that we both have a collaborative spirit and that working together might be a great idea. In 2009, we decided to launch our company.”

Today, their company employs a full team of designers and developers. It serves hundreds of clients around the world, including brands like Brightland, Rosebud CBD, Schermer Pecans, American Spoon, and more.

Pastre and Rowson are the storytellers behind brands like Edwards Virginia Smokehouse

The two women see themselves as both brand problem solvers and storytellers. They enjoy learning about the people behind the products, traveling to meet their clients at their farms or businesses to learn about their process, the company, products, and families on a personal level.

 

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Money

How To Make Money By Starting A Business

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Unfortunately, there is not a 100 percent, foolproof, guaranteed process that will ensure profitability for every business. However, there are several general concepts that most successful business owners follow to expedite turning their business into a profitable entity.

In the information below, we’ll outline five steps that any business owner can follow to improve their chances of making money. As a general business practice, it could be useful to purchase business insurance.

Step 1 – Sell Your Product or Service on Freelancing Sites

These websites are quickly growing in popularity with larger businesses as it’s easier for them to find speciality service contractors who are experts in their field and can provide exceptional services – without having to hire them as an employee. They require very little training and are typically hired on a per-project basis. For the contractor, it’s a great way to build a client base, provide a solid online reputation, and eventually outsource your business to others.

Step 2 – Fund Your Idea from Small Business Loans and Grants

Many of the largest and most successful businesses were started or expanded with investment capital – such as small business loans and grants. If you read most expert business start-up books, they’ll typically suggest that risking your own money or life’s savings into your business typically leads to poor decision making and negative results. While you’ll have to pay back small business loans, you can do so with minimal monthly payments.

This not only helps to off-set your monthly capital expense, but also helps your business build credit, which is needed in today’s financial world. Grants from government agencies or private non-profits also can provide you with less risky financial strength, giving you the peace of mind to push forward in launching that new idea or product into the market.

Step 3 – Make Your Business a Side Hustle

For those not familiar with the term, a side hustle is a part-time ‘gig’ or job that you can start with very little capital investment, and quickly begin to make money. Some examples of this include freelancing (like we mentioned in step 1), rideshare (such as driving for Uber or Lyft), or delivering food (through online delivery apps or with brick and mortar retail operations). If you’re looking to make money with a business, and don’t want to invest a lot of time or money into building it, then think about making that business something flexible and convenient.

Step 4 – Wait till You Are Ready

Sometimes when you start a business, it’s tempting to take a leap of faith, simply to make it profitable as soon as possible. However, this can backfire if you don’t have the bandwidth or flexibility to ensure it happens with reduced mistakes. Instead of rushing into expanding a business, make sure you have the capacity, the financial backing, and support from others to handle the increase in business.

This mistake happens quite often with contractors who work with multiple clients, take on too much work, and begin to have issues delivering projects on time. Even worse, they complete jobs with reduced quality. When this situation occurs, it causes clients to post negative reviews, which may cause more harm to the new business than the additional revenue. As a result, always wait to expand your services until you are ready and able to complete work with the quality you’re know to produce.

Step 5 – Attend Focus Groups and Networking Events

Arguably the best way to expand your business to optimize profitability is to network with higher-paying clients. When you’ve established yourself as an expert in your industry, you can begin to network with larger companies or decision makers directly, by attending networking events. One great tool to consider using is LinkedIn, where you can connect with local business owners and search for networking events in your area.

 

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Boeing 737

Skills Inc. Lays Off Workers As Supplier For Boeing 737 Max

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Numerous employees at Skills Inc, an Auburn, Washington-based supplier for Boeing, have been laid off, furloughed, or had hours cut, current and former employees told Business Insider. It’s the latest in the fallout from Boeing’s decision to suspend production of the troubled 737 Max airplane.

Skills, Inc is an aerospace manufacturer and supplier, and is among about 600 companies that builds components for the Boeing 737 Max. Unlike similar companies, however, Skills is a nonprofit.

The company, which describes itself as a “business with a social mission,” is a “self-supporting nonprofit social enterprise” that offers training and employment for people with disabilities.

Skills has about 600 employees, according to its website, and says that 60% of workers have a self-identified disability. The company describes itself as “a fully integrated work environment where individuals with and without disabilities work side-by-side throughout our four lines of business.”

In a termination letter sent to some affected employees, and seen by Business Insider, Skills Inc.’s CEO Todd Dunnington said that the company’s staffing imbalance, which was caused by “reduced production rates at our largest customer,” was initially expected to be short-term but is now “forecasted to last for an unknown amount of time.”

Several employees confirmed to Business Insider that they had been told the layoffs were due to reduced demand by Boeing.

The recent layoffs and work reductions are the latest rounds, following earlier reductions in 2019 due to reduced 737 Max production, a current employee, who asked to remain nameless, told Business Insider.

Workers at the company were left blindsided and scrambling, but while they were unhappy about the situation, most of the employees Business Insider spoke with had only positive things to say about Skills.

“I simply hope to hear from my Skills supervisor before my savings and food run out,” one employee, who had been laid off, told Business Insider. “I am more fortunate than many in that I have family and friends in Seattle who will make sure I do not end up homeless.” The employee, who suffers from a chronic illness affecting their vision, dexterity, and cognitive and memory abilities, asked to not be named in this story.

“I’m so sad,” another employee, who was near retirement age and was laid off, told Business Insider. “I wasn’t ready to be put out to pasture.”

Representatives at Skills Inc. did not reply to repeated requests for comment and attempts to connect. Boeing did not respond to a request for comment.

The total number of affected employees was not immediately clear.

Boeing announced in December that it would temporarily suspend 737 Max assembly and acceptance of supplier components starting this month. The 737 Max has been grounded worldwide since the March, 2019 crash of Ethiopian Airlines Flight 302, the second fatal crash within five months. A total of 346 people were killed between the two crashes of the jet, the latest model of Boeing’s workhorse 737 narrow-body.

Boeing reduced production of the Max from 52 to 42 units per month as of April 2019, but it had otherwise maintained production throughout the grounding. However, it has been unable to deliver completed planes to customers during the grounding, leading to a pileup of about 400 completed planes at its facilities, stretching its storage capabilities.

While announcing the production suspension, Boeing said that it had no plans to lay off or furlough any of the 12,000 employees at the facility that assembles the 737 Max, instead temporarily reassigning workers to other tasks or teams.

 

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Australias Fire

Disasters Like the Australia Fires Happen When Businesses Ignore the Climate

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Marco Lambertini is CEO at WWF International. Eva Zabey is executive director at Business for Nature. The opinions expressed in this commentary are their own.

The devastation caused by the Australian wildfires in recent weeks is a poignant illustration of what can happen when businesses and governments ignore the risks they pose to nature and people.

Scores of people and millions of animals are known to have died in bushfires that have raged across Australia for months. On top of this tragic cost to human life and nature, the cost to the Australian economy could reach as much as $70 billion, once the impact on private property, public infrastructure and tourism is taken into account.

So much of this could have been averted.

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Financial Risk

How To Manage Financial Risk When Starting A Business In Retirement

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Modern retirement is no longer a career-ending event, but instead, often a professional reinvention. “For many people, retirement is a time to take on an encore career or start a new business,” says Jamie Hopkins, director of retirement research at Carson Group.

Just because retirement can be a great time to start a business, that doesn’t mean entrepreneurship at that time of life comes without its risks. One of the biggest: time.

“The risk of starting a business in retirement is that you don’t have time to recover from large financial hits,” says David Deeds, Schulze professor of entrepreneurship at the University of St. Thomas and executive editor of the EIX — Entrepreneurship and Innovation Board. So, while in the planning stages of your part-time retirement business, start thinking about how you will manage the risks.

“To be in the right financial condition to start a business, make sure you have enough liquidity [the ease of getting cash],” says Brandon Renfro, a financial adviser and assistant professor of finance at East Texas Baptist University, in Marshall, Texas. “This means considering not just the money you invest, but the financial commitments, like loans and equipment leases that you’ll take on.

To mitigate financial risk, it’s wise to consider starting a business that’s not very capital-intensive, like consulting or digital services. “You can do part-time consulting in your industry and selectively take on projects that appeal to you,” says Mike Hennessy, CEO of Harbor Crest Wealth Advisers in Fort Lauderdale, Fla.

While some financial risk is unavoidable as a retiree starting a business, the following five strategies can give you the best chance of succeeding:

1. Get smart about startup capital. Morgan Taylor, chief marketing officer for LetMeBank, a tool to find a bank or credit union, advises that you “set aside the amount you’re prepared to lose. Treat this as a non-available income. If you lose it, you lose it.”

2. Minimize your startup costs. Start small, test ideas on a digital audience or professional connections, if possible, and then scale if successful. Your goal should be to keep initial expenses and operations lean.

For example, look for low-cost marketing opportunities like networking events; don’t invest in expensive equipment you can borrow, like a printer or scanner and use what you have — like turning a corner of your living room into an office rather than renting space.

3. Avoid withdrawals from your retirement accounts. Says Renfro: “You’ll need money to acquire the productive assets for your business. If you withdraw that money from your retirement accounts, which is most likely where it is, then you’ll owe taxes on that distribution.”

And then, if you are already near the top of your tax bracket, the withdrawal could push you into the next higher bracket, he adds.

If you must tap your retirement account to start the business, Renfro suggests spreading the withdrawal over the course of two years, to help avoid tax-bracket creep. “You can do this fairly easily by withdrawing in the last month or two of the first year and then taking the rest out in the beginning of the next,” he says.

4. Consult a pro regarding your income taxes. If you’ve never run a business, you may not realize that taxes will become more complicated. “Your employer won’t be automatically taking taxes out of your [paycheck],” says Taylor.

You are the employer, which means you’ll need to set aside the proper amount of income from your business to pay the Internal Revenue Service. This means you’ll have less in liquid cash, because you’re essentially paying taxes in advance.

 

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