By Katherine Zobre
Alabama Small Business Development Center Network | 201-503-5927 

Managing finances at the best of times can be stressful. During a crisis, things get even more complicated. We are all feeling the crunch of COVID-19 – at home and business. However, crises are opportunities for us to take a hard look at our finances. Take a breath and prepare to face some hard truths.  

Step 1: Perform an asset analysis.

During this crisis, take a broad view of your personal and professional assets: your skills, attitudes, habits, education, credit, social and professional network, home, car, inventory, cash on hand, and retirement savings, etc. Now you know what you can rely on and potentially turn into cash. The key to weathering crises is to conserve your cash on hand and take advantage of opportunities. You can only take advantage of opportunities if you’re prepared to see them as opportunities.  

Step 2: Categorize expenses.

Start with your February bank and credit card statements. Review and categorize each expense item into one of the following categories: Essential (E), Non-Essential (NE), Reduce (R). Your Essentials (E) should include things like your mortgage payments, loan payments, insurance, etc. Non-Essential items should include unnecessary expenses such as Netflix subscription. Items that fall into the Reduce (R) category are items like grocery and utilities – essential items that you have some control over 

Once you’ve gone through February, go through the 12 months. Take note of when annual payments are due and seasonal spending habits. Going through your monthly and annual statements will allow you to see your ‘cash cycle’ of your home or business. 


Managing Your Small Business in Times of Disaster

3/26/2020 | 4:00 PM – 5:30 PM (CDT)
Presented by ASBDC in partnership with REV Birmingham

Using the framework Alabama Small Business Development Center’s Disaster Recovery Toolkit we will explore 10 actions you can take to improve your cash position during a time of disaster like COVID-19. A panel discussion and Q & A with REV’s Director of Business Growth, Katherine Zobre of SBDC and Damian Carson of Operation Hope will follow the presentation.

Register Now

Step 3: Communicate, communicate, communicate.

You started your business and run your household with a set of core values and goals. Take a minute to articulate your family or business’s mission statement and core values. Now is when you’ll need them the most. Your mission and core values are conversation starters.  

Start by getting in touch with all the goods/service providers you marked as Essential on your expenses. Ask for extensions without penalties. Some lenders/creditors will allow you to postpone payments without penalty for 60, 90 or even 120 days. Next, look at the Reduce category and work down the list to reduce these expenses. Finally, (and this is the most emotionally difficult) start eliminating non-essential expenses.  

Don’t hide your financial concerns or difficulty from your banker, creditors, vendors, family, or your employees. Talk to your customers about ways you’re doing your part in the community and how they can reciprocate. Talk to other business owners in your industry about how they’re coping and neighbors on your block. Discuss your needs with your local Chamber of Commerce, local government, and representatives.  

Step 4: Stay healthy. 

Health insurance is one of the biggest expenses for small businesses and households alike. Take this social distancing opportunity to build better habits related to your health. Drink more water. Get more sleep. Exercise and stretch.


Contact your banker, your insurance agent, and chamber of commerce for additional resources.  

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