Skip to main content

An economic crisis can occur at any time and completely alter our business. This can come in the form of an external crisis, such as the COVID crisis, or an economic crisis, like 2008.

But a crisis can also come within your own business. All of a sudden you may have to close, or business, because of a decision, has reduced considerably.

At the moment, this post has been drafted during the 2020 COVID crisis. 

Since March 14th 2020, our physical shop has been closed due to the government lockdown imposed on our beautiful city. On the 13th we realised staying open with the alarmingly increasing threat of the COVID virus was too big a risk. And although, from the 14th the government allowed us to fulfil internet orders, we found that coming in and out of the shop, covering deliveries, etc… was simply too unsafe.

This has meant 16 days of hardly any income, bills that had to be paid, and a rush to apply for government help. We were able to pay all of our suppliers and florists. Currently, all we have left, is what’s in our bank accounts, and anything we get from any unpaid invoices that are owed to us. This what we have to live from, during the next weeks, maybe months.

And we ask ourselves the same question probably going through your own minds: How long must we wait to start up again?

In this post I want to tackle the most pressing problem for florists at the beginning of any crisis: cashflow (liquidity). This is the essence of any business and the most critical issue.

Plan your cashflow smartly

It may sound pretty obvious, but 60% of business that go bust don’t do so because they don’t have enough profits. They do so because they just don’t have the cash flow. And right now, that’s the problem everybody is facing.

To tackle this problem the most immediate step you can take for your business is to plan. A plan will provide you with the essential steps to forecast how to tackle your problems and make your runway much longer than your current one. To do this, you need to take into consideration both external and internal factors. These are essential in order to take any steps to meet your financial obligations until your cashflow restarts.

External factors affecting your business

Any crisis that affects large businesses results from a major public disruption. As a result we need to look at how any crisis, including the current one generated by COVID-19, impacts the political, economic, social and technological areas. All of these will impact our business. As a business we need to know how to respond to each hit as it impacts our bottom line. 

Politically, how is the political class responding to the crisis? How will their decisions impact our businesses now and after the crisis? What economic policies has the government put into place? What will any future ramifications from these economic and political decisions mean for our business? How will society react to the crisis? How are their daily lives impacted? How are their mindsets changing? How will these changes influence their perception of flowers and plants? Finally, what has the effect been on technology? Does technology play a similar, greater or smaller role on our business? How have current technologies been used during the crisis and will this continue or change after the crisis?

Understanding these important factors will allow us to recognise any threats and opportunities. It will also allow us to perform some risk assessment on how to react to every change, as well as towards any internal challenges generated in our business.

The internal factors 

Only you know your business’ weaknesses, strengths and the possible threats that will affect you and your financial obligations. In order to meet these obligations in a structured way, and in the long-term, it is important to assess what external (political, economic, social, technological) and internal (overdue payments, staff, current payments) threats affect your cashflow. 

From an internal point of view, look at your current weaknesses and decide how to manage these. These are all risks. Write them down and treat them as priorities. Ask yourself which to tackle first or which risk will be the first you will be confronted with.

Yet, it is not all about focusing on the weaknesses - even though in the current situation is best to deal with them first. We also need to look at your strengths and foresee the opportunities these can create when tackling risks. Your strengths could include having a have a good credit rating, or that you have enough cash flow that suppliers may be trusting and allow you to pay invoices in instalments. You may have great negotiation skills, or you have online products which you can sell without relying on a physical shop. 

It is also essential to look at what this crisis may provide in the form of tax-relief or financial-aids. 

Your focus must be on coming out of this crisis in a stronger position. Identifying your strengths and locating your most profitable opportunities will enable you to positively manage your risks, increasing the extra-long runway required for any subsequent liquidity crisis.

Stretch your cash runway

Your must now plan out your response to any liquidity issues. Look at all the external and internal risks. Create an action-plan, by putting the biggest risks as the first obstacles to tackle. Each problem must involve a solution that has you paying the least amount of cash as possible. Remember that no payment is not an option. Our industry and economy depends on cash flow. Additionally, your are legally bound to pay.

This process will enable you calculate how much cash goes out, and provide you with a payment strategy which will help you determine how long you can stretch-out payments. This will allow you to create a lot more certainty in your future. In the meantime, you also need to trim any non-essential costs and increase the effectiveness of your cost-structure, during this crisis and after.

Yet after wading this storm, you need to know how to come out stronger....


Did you know we have a course on how to manage the COVID crisis as a Florist? NO?! Well, what are you waiting for? Visit the course section of my website and click on The Florist's COVID Management Course.

Add new comment

Restricted HTML

  • You can align images (data-align="center"), but also videos, blockquotes, and so on.
  • You can caption images (data-caption="Text"), but also videos, blockquotes, and so on.