At Kinloch Anderson in over 150 years of trading, we’ve seen two world wars, rationing and countless economic cycles. Each generation of the Kinloch Anderson family has had their own challenges to overcome and the coronavirus pandemic is the most testing challenge we have faced in my lifetime. Lockdown restrictions combined with Brexit have added to the complexities of the situation and many SMEs are finding themselves in financial difficulty, particularly those that cannot open or quickly pivot to digital offerings. In the current economic downturn even the most well run businesses are facing unprecedented uncertainty. As opposed to discussing the tough realities of the situation, I would rather paint a picture of hope for the future and offer tangible advice.
Firstly, it’s important to recognise the pandemic is not a marathon, nor a sprint. It’s an ultra marathon. SMEs have to think laterally and be prepared to adapt to the times. Thus my advice is threefold…
Adapt The Business To The World It Finds Itself In
Businesses should not be afraid to explore new products and services to survive in the short term. The Kinloch Anderson brand is synonymous with Kilt making, Tartans and all aspects of Highland Dress. However, with the vast majority of formal occasions, weddings and graduations being cancelled, the demand for our most notable products simply isn’t what it was. As such, we’ve needed to think laterally and launch new products and have diversified into face masks and are currently exploring other interesting products utilising the skill sets we hold and USP’s we are known for.
Embrace Financial Management Best Practices & Support
The best practice for managing finances through economic downturns is no different for individuals and businesses alike. If at all possible, businesses should strive to always keep a fund for unforeseen circumstances. If the business was founded or built upon substantial debt, or if the profits have been fully extracted by shareholders when available, it should be no surprise that at some point the business runs into financial difficulty. That being said, I’m well aware that we are approaching the one year mark of lockdown restrictions and even businesses that have been managed responsibly are likely to be facing cash flow challenges. Whilst the government furlough scheme and grants have been most welcome, for many businesses the support does not cover all or even the majority of their overheads. Thus, it’s worth exploring other avenues to control costs and also financing options to bridge the gap in the short term.
Remember What Made Your Business Special
It can be easy to lose sight of what made your business special in the rush to do things differently and the situation we all find ourselves in. But humans are very adaptable and there is positive news with vaccines etc. and one day the world will revert back to something closer to what it was and at that time businesses need to be able to capitalise upon the opportunities that present themselves. Until then, we all need to keep going.
John Kinloch Anderson, CEO of Kinloch Anderson