The economic ramifications of the very recent coronavirus (COVID-19) outbreak has led to huge financial concerns for businesses large and small. With some states forcing business closures to only keep essentials open, this is a scary time. If you are a business owner or manager faced with this tough situation, do not give up hope. There is a solution you can take.
Responding to the coronavirus: stop the bleeding
If your organization isn’t able to earn revenue due to a forced closure or is seeing decreases in revenue, there is one simple solution: cut costs. Your business likely still needs to remain operational to a degree so some costs will be completely unavailable as you’re being faced with the threat of making little to no revenue. However, by cutting costs, you can stop the bleeding caused by the COVID-19 outbreak and pave a path to weather the storm until the economy recovers.
How can you cut costs? Well, there are a variety of options available to you. I’ll share a few with you here.
1. Keep operations lean
If your company will be running its facilities during this time, try being more conservative with your electric use. Turn off lights that don’t need to be on or unplug computers that aren’t being used. You would be surprised how much it actually costs to run appliances and electronic devices that remain plugged in, even if they aren’t being used; by lowering or eliminating charges for running these, called phantom loads, you will lower your electric costs. For more on that, check out this article on phantom loads.
2. Consider upgrading your energy systems
On the surface, you may be thinking: I’m in a financial crisis, how can I possibly afford to upgrade my HVAC system? The answer is through leveraging creative financing methods and taking advantage of readily available tax incentives. There are even plenty of options out there to complete projects with no money down. Some options you could look at are:
- PACE Funding
- Federal Tax Credit
- State Tax Credit
- USDA REAP grants and loans
It’s easy to think funding might not be possible for your company. But, with options such as the USDA Rural Development Office that offers up to 25% of total project costs and loan of up to 75% of total project costs — upgrading energy systems can be attainable. Check out our website to discover more financing options.
3. Cut Overhead Costs
With the fast spread of the coronavirus paired with the CDC’s recommendation of social distancing, there is a worldwide slowdown in spending. According to a flash survey of the CNBC Global CFO Council, big companies have already taken a hit in 2020 from the coronavirus with a “major decrease” in demand from China cited by 40% of chief financial officers.
With less demand, companies must cut overhead costs where possible. Recommended areas to cut back on would be hiring new staff and external consultants, delaying new IT projects, and minimizes travel expenses. If resources need to be allocated to virtual work, cutting costs such as a less expensive router for WiFi could be considered, especially if employees aren’t working in the office.
For More Information
For more information on how to cut costs and how to finance an energy system upgrade during this time, contact us! At EnergyLink, we are committed to helping our clients find energy-saving solutions even in this challenging time.