Many of the curve balls thrown the way of business owners in 2020 were not possible to anticipate. And for many business owners, it was all they could do to try and survive this turbulent year. And as the year winds to an end, there are a few steps franchise owners can take to ensure their business makes it to see 2021.
You will find many of the entities with which you do business willing to show a bit of flexibility during these trying economic times. Professionals like accountants and attorneys might adjust the payment schedule for any retainer fees you pay to them. Another idea is calling your landlord and discussing rent relief alternatives until the economic times are better. It is important to remember that the pandemic is affecting everyone, and helping your franchise survive until the new year benefits everyone with whom you do business.
Creative franchise owners will discover new ways to address customer needs despite the obstacles. One example of this creativity includes gas stations that now offer full-service so that customers possess no worries about touching gas pumps. A second example is a supermarket that sprays down grocery baskets after each use. Business owners should remain on the lookout for solutions particular to their industry that will make customers more comfortable when spending money in their establishment.
Get Help from Franchise
Franchise owners should not underestimate the value their franchisor can be when tough times strike their business. Your franchisor is the unchallenged expert regarding the business model you are using. A franchisor will likely be able to counsel you on any adjustments you can make that will facilitate the survival of your business.
Take Advantage of Government Support
Small business relief programs provided by the federal government are well-publicized. But not as many franchise operators understand the support that may await them from their local government. Most areas have one or more business task forces dedicated to the fate of small business owners in their area. Franchisors can also speak with local legislators to inquire about local business aid. Some franchisors have been able to convince legislators in their local area to adopt aid programs offered to business owners in other cities. Franchises and other small businesses are the lifeblood of many local municipalities, and local governments have a vested industry in the success of these business operations.
Empathize with Customers
Franchisees should not forget that their customers are living through the same hardships that presently affect everyone else. Business owners can secure the trust of customers by demonstrating their understanding and compassion for the people that patronize their business. Make sure you reach out to customers with updates that concern them and do your best to limit their exposure to the problems you face.
Increase Tax Savviness
Employers who are unaware of the tax relief available to them should spend the time necessary to familiarize themselves with potentially helpful tax codes. The Employer Retention Tax Credit is one tax code with which employers should familiarize themselves and provides franchisees with a 50 percent tax credit toward the compensation costs of qualified workers. Other considerations include:
- Deferred payment for payroll taxes
- Extended tax filing periods for companies that experience net operating losses
- Immediate receipt of 2021 alternative minimum tax credits
- Increased deductions for business expenses
- Tax write-offs for building improvements
The Bottom Line
Maintaining a franchise is a tough chore for a business owner in the best of times. But this task becomes much more difficult when financial environments become more challenging. Franchise owners who want to ensure the survival of their business through the new year and beyond can set a solid foundation for themselves by remaining mindful of the six tips profiled above.