As the coronavirus crisis has developed over the past few weeks and months, it has become increasingly clear to everyone that this situation is unlikely to be brief in duration.                      

For this reason, it is important for businesses to start thinking about putting into place a coronavirus business contingency plan – to protect your interests and ensure that you still have a business when lockdown ends.

Why Is A Contingency Plan Necessary?

It doesn’t matter what type of business you have, or what industry you are a part of – coronavirus is going to hit everyone hard over the coming months. Keeping your business up and running throughout will require forward planning, and a better understanding of how this crisis is likely to play out.

The reason that lockdowns have been implemented globally is in order to ‘flatten the curve’ of virus infections, to stop hospitals becoming overwhelmed with patients. Most countries are considering their options for exiting lockdown now, but it is generally understood that to avoid a second wave of infections, further lockdowns will need to be implemented in the future to slow the spread.

Scientists working on managing the virus estimate that social distancing measures will need to be in place for a year or even 18 months until the virus is under control or a vaccine is available. This means that the likelihood is that there will be periods of relative freedom, followed by strict lockdown measures, intermittently for this period.

Companies of all types will see fluctuation in business throughout this time and must plan ahead for disruption in order to stay afloat.

What Are Experts Saying?

In March, the government published its own coronavirus action plan, which includes a scenario which assumes that 20% of your entire workforce could be off at any one time.

Meanwhile, estimates from leading city expertsbelieve that, in this quarter, the economy could contract from anywhere between 7% to 24%, which are huge numbers given that quarter to quarter differences are usually measured in fractions of one percent.


Points To Consider

Lockdown having gone on for more than a month already, you are probably already somewhat sure of what you are doing for the moment. But what do you need to think about going forward?


Your business needs to protect its staff throughout the crisis in order to keep people happy and ensure that you have staff left to run the business at the end of the pandemic.

Protecting staff can mean looking after their health and giving them as much of their pay as possible during furlough, but it also means supporting them during this time.

What can you offer to make this period easier on your staff? Can you provide equipment and software for them to work from home? If you are re-opening your premises, how can you promise staff that they are safe and protected if they come in?


The pandemic means that there is no way around it – your operations are going to have to change. It is now up to you to work out how you can do this and what factors you need to consider. Think about what you can do if your premises have to close for a period, and how you are going to manufacture and deliver products during this time.

Supply Chains

This is an area that is affected for businesses all over the world, thanks to borders closing and new safety regulations making it harder to source and create certain things. Think about how you can manage your existing supply chains, and support suppliers who might be facing cash difficulties in the short term.


Your customers are where you make your money so it is critical that you consider them in your contingency plan. Think about how customers are likely to be affected economically and how you can change your business to suit their current needs better.

Look at different ways of offering credit to your customer. You could also consider invoice factoring to give yourself assurances of being paid on your invoices.


Your cash flow is going to fluctuate for a while, so think about various scenarios, both best and worst-case, and develop a series of actions you can take in various situations.

Creating Your Coronavirus Business Contingency Plan

Focus On Improving Cash Flow

Imagine a worst-case scenario where there is no money at all coming into the business for several weeks. It is your job now to work out how you are going to keep your company thriving during this time, in such a way that you can still come back from it afterwards.

The key here is to take advantage of every grant, benefit and loan you are entitled to. The government has announced a package of business benefits including the Coronavirus Job Retention Scheme, which allows you to keep your staff, and the Coronavirus Business Interruption Loan Scheme, to keep your cash flow steady.

At the time of writing the Government has also announced the “coronavirus Bounce Back Loan”.  This will allow you to borrow up to £50,000 on very attractive terms, where the government itself will guarantee 100% of the loan, which should make nervous banks more amenable to approving the loan.

You should also get on top of credit control and call in money that you are owed as soon as you can, before the situation gets worse. Do try to bear in mind, though, that customers may be going through financial hardship themselves, and it is better to retain a customer than to get a small amount of money owed but then lose that person forever because of harsh credit control procedures.

Prepare For Reduced Capacity

No one can be certain how the coronavirus crisis is going to play out in the long run, meaning that businesses will have to create several contingency plans to deal with a number of different scenarios.

One of these areas is in what capacity you will be able to run at. During lockdown is one thing, but as things open up again slowly but surely, you can start thinking about how to manage staff, sales and cash at various capacities.

As a jumping off point, think about working at 25%, 50% and 75% of your usual rate, plan for how your usual business processes may have to change, and try and build in flexibility in terms of different personnel being able to cover for one another in case of absences.

Branch Out

It may sound completely counterproductive to think about expanding your business at this time, but some businesses are finding that being flexible and making changes to their company is what is saving them at the moment.

The business you have been running may simply make no sense during a global pandemic, but this doesn’t mean you can’t keep running.

A good example of companies who have taken advantage of this are pubs and restaurants who are now doing delivery food and alcohol services, putting on pub quiz nights online and so on, allowing them to stay operating and busy, and conveniently keeping them fresh in the minds of customers ready for when they can reopen

Work out how your business can be valuable during the current situation and add this to your contingency plan.

Risk Management & Business Continuity

In the end, some businesses will have to make the decision that they cannot run during the current situation. You need to add to your contingency plan some thoughts about what would have to happen for you to make this decision, and how you would cease trading if this did become the case.

Work out what risks your business faces, as well as yourself as a business owner. Identify any contracts or agreements which you may have personally guaranteed and get professional advice on what your exposure would be if the company cannot continue.

Look at things of value with the business, including intangible items such as your customer book, and try and estimate as accurately as possible the latent worth of the business, just in case you need to raise cash in a hurry.

Now would also be a good time to familiarise yourself with the processes that are used when closing a business. Research terms such as “creditors voluntary liquidation” and “going into administration”. Keep in mind that you have to be very careful about extracting money from your business if you have creditors who are still owed money, as this could come back to haunt you if it is not done correctly.

Have an exit strategy that is just as strong as your business continuity strategy, as a positive end to your business will hold you in good stead in the future.

In Conclusion

Donald Rumsfeld, a controversial US politician, made quite a famous speech an excerpt of which is below

“there are known knowns; there are things we know we know. We also know there are known unknowns; that is to say we know there are some things we do not know. But there are also unknown unknowns—the ones we don't know we don't know“

Cryptic yes, but the general message that no one knows what is going to happen next is certainly true now for business owners in the UK and beyond. Try and plan for as many eventualities as you can and be proactive in planning for your company’s future.

If you need help or guidance, then please drop us a line here at TFMC. Our experts are here ready to take your call and discuss the ways we can be of assistance in these difficult times.

Call us on 0800 470 4820 or send us anemail at – we look forward to speaking with you.

Kass Verjee
Kass Verjee

Kass is not only a qualified bookkeeper/accountant but he is also a Fellow of The Institute of Chartered Accountants in England and Wales and has a full practising certificate.