Around the globe, COVID-19 has upended economic and social norms and expectations – and small businesses are paying a heavy price. Temporarily closed storefronts, reduced consumer demand for many goods and services, and widespread financial anxiety have generated the perfect storm to drive down the revenues of companies with limited cash reserves.
Resources are available, of course, and many U.S. small businesses have been able to take advantage of emergency loans and advances from the federal government. But the fact is, even with government intervention, more than 100,000 small businesses have been forced to close permanently since March. And, while most cities and states have reopened, much uncertainty remains about the future course of the pandemic — and the future strength of the American economy.
For businesses engaged in international trade, including small companies that export goods or rely on materials from abroad, the challenges have been amplified by diverging national shutdown rules and significant interruptions in global supply chains. These obstacles, and the overall uncertainty about the world economy, have dampened trade plans for many organizations. According to a recent DHL survey of more than 2,000 small and medium-sized enterprises, trade strategies are being widely adjusted. Almost half of all respondents say the coronavirus has prompted a more conservative approach.
However, many organizations and government agencies have stepped forward with financial relief, guidance and support programs for traders — and there is a widespread recognition that global commerce could spark an eventual economic resurgence. But consumers have become increasingly reliant on e-commerce to obtain needed products. This presents certain opportunities for U.S. exporters who sell their goods online. And although consumer spending overall is certainly down due to the pandemic, retail traffic (which pre-pandemic was already migrating towards online sales) has turned digital at lightspeed. Consumers are actively making online purchases and their perspectives on what can be purchased remotely has changed dramatically.
So, how can your small business navigate the global COVID-19 storm, and how can you determine if it makes sense to consider changing conservative trade plans into more aggressive strategies? Here are some resources that can help:
International Trade Administration (ITA)
To encourage the export of U.S. goods and provide relief for traders, the ITA’s U.S. & Foreign Commercial Service (USFCS) has temporarily reduced, and in some cases eliminated, the costs of certain export and investment services. The services offered by the USFCS can connect your company with potential buyers overseas; assist with the promotion of your products and services; and provide important market research assistance. To learn more, visit Trade.gov.
Export-Import Bank of the United States (EXIM)
EXIM has implemented relief measures for traders through August 2020. These relief efforts are designed to help EXIM customers (especially small businesses) who need access to working capital and export insurance policies, but are currently facing financial challenges. See this fact sheet to learn more.
DHL Resilience360 COVID-19 Supply Chain Resources
To help businesses better understand the impact of the coronavirus on world markets, DHL offers early warning intelligence based on business contingency planning that supports best-in-class supply chain risk management practices. To see COVID-19 special reports and daily updates, and to learn more about DHL’s full risk management software platform, visit DHL Resilience360.
U.S. Small Business Administration (SBA)
For companies in need of assistance, the SBA offers comprehensive guidance for small businesses on the road to recovery, as well as special coronavirus funding options under the CARES Act. While the CARES Act loans are well-known to small businesses, it is important to remember that the SBA offers broader support and specific recommendations to comply with CDC guidelines. While most SBA-network offices have reopened, some advisers continue to work remotely. Check here to see the status of local offices.
America’s Small Business Development Centers (SBDC)
General resources and tips for small businesses dealing with the pandemic’s impact are available from the SBDC. The SBDC, in partnership with the SBA, catalogues and compares available loans for your company and offers a variety of webinars to help guide you forward.
In addition to the resources provided by the organizations listed above, a consolidation of all available federal funds and support services can be found at covid-sb.org, a website dedicated to U.S. small businesses.
As companies reevaluate their global trade plans in the wake of COVID-19, it is critical to retain clarity, understand the facts, and remain hopeful. After all, governments around the globe are taking strong steps to strengthen and support trade, and new trade agreements are part of the picture. For example, the U.S.-Mexico-Canada Agreement (USMCA), which was implemented on July 1, will usher in a new era for American companies planning cross-border business with Canada and/or Mexico.
What is your business doing to meet ongoing coronavirus challenges? Let us know on Twitter @DHLUS.