By Marisa Rauchway and Lana Berman Israel
On March 23, the International Franchise Association (“IFA”) hosted a panel of franchise industry leaders to provide “in the trenches” advice for franchisees during the COVID-19 pandemic. Here are the key takeaways from the webinar:
1. Familiarize Yourself With Not Only The Federal Stimulus Package, But Local Options As Well: Go to your state, county, town and municipality website to see what funds may be specifically available for small businesses – including franchisees – during this time. Be on the look out for contact information of individuals who may be able to walk you through the process for the COVID-19-specific funding. It is critical for you to understand the different loan/grant provisions available and to pay particular attention to certain loan or forgiveness programs that are mutually exclusive or have qualifications (e.g. debt forgiveness available only if you haven’t furloughed employees, etc.)
2. Use This Period of Time to Review All Your Existing Obligations: If your business has slowed down – or shut down—due to the pandemic, use any additional time to your advantage to try to get a handle on your obligations under all existing contracts and your relationships with other parties.
3. Leverage your Relationships and Renegotiate these Obligations – Once you have reviewed all of your contracts and your obligations, start reaching out to all of the parties you have relationships with – franchisor, landlord, lender, suppliers, etc. What is in every party’s best interest? If funds are low and obligations may not be able to be met, are there creative business solutions to renegotiate contracts? Now is the time to think outside the box.
4. Create a Mode of Communication. Depending on your organization, consider giving your employees an open forum to communicate their concerns. Message boards, Zoom conferences, Google Teams, group texts or other modes of communication are all potential channels.
5. Get your paperwork in order – If you anticipate that you’re going to be applying for any aid package, now is a good time to get all your financial paperwork for the past year in order. While the application processes for many of these grants/loans are often relaxed in-light-of the circumstances you still will need to document your financial history as most loans are based upon this information.
6. Never Underestimate Power of Goodwill - Community Outreach – Developing goodwill within your community is a “win win”. Franchisees on the webinar spoke of donating unused supplies to local animal shelters or food pantries, allowing the outside of closed shops to be drop off locations for donated goods, providing hungry locals discounted excess food, or outreach to local elderly or infirm. Some restaurant franchisees also spoke of making sure that your employees and their families are fed at deep discounts.
7. Speak to your Team of Professionals. Even working remotely, accountants, attorneys, organizations such as the IFA, and government resources are all generally available to provide guidance and resources during this time.
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