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Dear business owner, this post is for you.  It is no news that Corona Virus (Covid-19) has adversely impacted businesses and economies around the world presenting many unprecedented challenges and your business is most likely feeling the brunt. Desperate times they say call for desperate measures, so, your business should be able to adjust to new and unique circumstances brought about by the pandemic.

While the Federal Government is doing its best and we still expect more intervention programmes and reliefs from them which may be in form of income tax waivers, customs and import duties deferment, tax credit, credit availability scheme etc., you are faced with the task of making decisions with far reaching consequence for your business at this critical time. 

Covid-19 presents a critical threat to the existence of your business, therefore, you should develop a tactful survival response and a business continuity plan to enable your business survive and to relaunch activities even after the end of the pandemic.

We will be considering some of the issues faced by businesses in the wake of the pandemic and the legal options available for mitigating its effects on the operation of your business.

CLIENT AND SUPPLIER

Most businesses particularly those in the manufacturing and retail sector have faced disruptions in their business activities even before the implementation of the total lockdown in Nigeria. This is because there has been a decrease in supply of materials for production from China (and other relevant countries affected by COVID-19) particularly to your business that rely on imported materials and goods. If your business is in the manufacturing and retail sector, I know this is a major challenge.

Unfortunately, after the pandemic, the risk of supply chain disruptions for you will still persist as there will be shortage of raw materials, increased costs and reduced orders. In essence, you may not be able to fulfill your obligations to your customers, investors and other stakeholders. There is therefore a need for you to do the following in order to deal with your supply challenges

Maintain Effective Communication Channels

You should maintain an effective communication channel with key business partners as well as your suppliers and clients. Maintaining a strong relationship with them will ensure that you and your suppliers or clients establish a short- or medium-term plan beneficial to all parties 

Provide Regular Updates to your Key Business Partners

You also need to provide regular updates and maintain transparency with regards to your business’s financial position and other challenges as this would make it easier for key partners to reach an agreement with respect to the business.

Have a Back Up Supplier

In addition to the above, it is also advisable for you to have a backup thereby seeking alternative means to get valuable materials or resources to your business, this could mean seeking other suppliers or partners as alternatives.

LABOUR

Labour is often the most valuable asset of small businesses, especially in the service sector, and we should not underestimate the impact of Covid-19 on labour for your business. 

As a business owner, you should determine the legal implications of the following:

  • Would I be liable to pay salaries where my employees are unable to perform their duties; especially where they need to be physically present to perform their duties?
  • Can I terminate employment in these current circumstances? and 
  • Can I unilaterally reduce or suspend the salary of my workers?

Despite these legal issues, you are most likely concerned about seeking a means to protecting your most valuable asset even though the pandemic has made this difficult. You as a business owner may have to make difficult business decisions at this point. You may consider doing the following:

  • Consider paid and unpaid leave as an option for your employees;
  • Assess your human capital structure during this period in order to avoid liability that may arise as a result of layoffs. 

In our next post will be considering other issues faced by businesses this season and the possible ways of mitigating these issues.

 

By: Abimbola Adekoya

See also: Five Ways to Ensure That Business is Not Disrupted by Coronavirus

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