Steps to Post Lockdown Recovery

(About a 6 Min Read)

Urgent Steps to Post Lockdown Recovery.

It is the smart operator who moves now that will come out the coronavirus issue the best.  Survival will go to the smartest.

I will go through the steps to get your business back up and running quickly.

The basic assumptions are:

  • you had a business with at least six months of sales data
  • you had a system (debtors or POS) that enable you to identify most of your clients

If you did not have these and you are going to reopen, think seriously about:

  • putting in a proper cloud accounting system
  • starting a loyalty system and getting to know your clients.

(Just jump onto the internet and see what is available. Look for industry and cloud accounting specific systems would work with your procedures and fit your budget.)

I would also recommend that you should have a "three month" cash reserve. That means you have the cash to survive three months without making one sale.  You have to be able to make provision for (the titles differ depending on your location) GST/VAT/Sales Tax, superannuation/pension, income tax AND your living expenses. The sales that you do make are a bonus.  You are buying time to collect data.

To be blunt, things will be tough as businesses try to get back on their feet.  Before lockdown, 80% of business did not survive five years; the figure will be a lot higher after coronavirus.

OK, you have made the decision to fight.  You have the data so you have the weapons.

If you are using Intuit QuickBooks Online, Xero or MYOB, hook in to right away.  By default, wants to give you Insights for the last three months - forget them.  You weren't trading.

But learn to use the Slack interface.  Smart operators are going to want to use every devise they can to reach clients who are still isolated.  Hook in with your bookkeeper, your business coach and all the clients you can.  They will want to place orders, have questions, provide advice and want to stay in touch.  It is your job to help them do so.

Remove all impediments to making sales.

Review your data in in the Growth section:

  • What was your average sales value before the shutdown?
  • How many active clients did you have in a week?
  • How often were these clients buying from you?

These are the starting goals that you want to aim to achieve.

Stay focused.

What is it going to take to achieve these goals?

Move to Focus section.  

The three Cohorts segment by how much they spent with you in any period.

20% of your clients will generate 80% of income. 20% of 20% will generate 80% of 80% thus:

  • "Great Customers" were the top 4% of the spenders.  They generated 64% of your income.
  • "Average Customers" were the 16% of spenders who generated 16% of your income.
  • "Poor Customers" were the 80% of customers who generated 20% of your income.

Find out everything you can about the "Great Customers" and "Average Customers".  Look at multiple time periods to see who has not yet shown up. They will get your business back up and running in the fastest time.

"Poor customers" will happen no matter what.  They are the one-off, the tyre kickers, the occasional passer-by who may never be this way again.  You have little or no control or input over them so do not go begging for their custom.

20% of your clients generate 80% of your income.

This is what kills most businesses off as they spend 80% of their expense money generating 20% of income.

And ignore the 20% of clients that generated 80% of their income.


So when things are tough, the smart ones get going.

You are starting to see the gaps in your sales information.  Start fixing them.  This is a slow time for you.  Do not waste it by cleaning the floors and washing the windows waiting for the possible return of clients.

Think about a system identifying your clients.  Most people will know a few clients with the bulk of them referred to as "Cash".  You want to reduce that volume as much as possible.

Think about putting in an effective Loyalty System right away.  Know your clientele. Encourage them to buy from you quicker than they otherwise might have.

You may know who your "Great Customers" and "Average Customers" are.

But do they know you have re-opened?

Do you know that they are back?

What opportunities have arisen?  They may be working from home and would be keen to have deliveries from your business.

The 4% "Great Customers" will let you know what to do.  They love you.  They are thrilled that you are noticing them. They proved it by spending all that money with you before.

THe 16% "Average Customers" are good at letting you know.  They want the relationship to get better.  This may be an opportunity to move them to "Great Customers".  

Who knows?  You will never, never know if you never, never try. shows you how much customers have spent with you.  Your Profit and Loss statement can tell you what your gross margin is.  Gross Margin is Income less Cost of Goods Sold.  

As an example, yours may be 50% (typical in a lot of industries).  So if someone spent $2,500 with you, they gave you $1,250 profit. They are worth $1,250.  

Isn't that worth the effort?  Maybe even an inexpensive, little gift (not "30% off their first purchase". Everybody does that and it is so insincere. Put a little effort into the "Thank You".)

Just let them know that they are appreciated.  

Especially now!! 

Thus when you first open up again, it will be quiet and slow.

Do not just clean your place and think it will all happen by itself.  

It will not!

Get into creating revenue by:

  • Strengthening your database.
  • Contact the people who you have details for.
  • Think about reducing the number of unknown "Cash" transactions.
  • Build relationships.  Have fun.
  • Understand
  • Set up stepped Targets in Growth.  You won't recover overnight but you will recover.
  • Talk to someone who will keep you on track.

Doing the same old thing you did before coronavirus lockdown just will not cut it!!

Good luck!!

David Seamans

Co-Founder at Elements, Retired CPA and Company Coach with 35 years of experience building better businesses.

Posted Jun 30, 2020