Pour yourself an adult beverage and take a seat. Let’s have a little vent sesh about small business rent.
As you know, 2020 is that one friend you really want to like, but honestly, they are bad vibes all around. This friendship needs to be canceled immediately. COVID has ravaged many small businesses, from hot vintage boutiques in Toronto to the local lemonade stand in Dyersville, Iowa.
With that in mind, many small businesses can no longer pay rent. With curfews, lockdowns, and fear of infection, most small business owners have faced financial strain. People have simply been unable to operate as usual. Tough finances and unemployment mean less consumer spending, and small businesses are no stranger to this circle of life. It’s been a rollercoaster, man—an endless journey of sleepless nights and hiding red-rimmed eyes with our shadiest of sunglasses. But don’t worry, boo, we’ll get through this together (pinky promise).
THE HOME TRUTH
Small businesses who are unable to pay rent may experience consequences that make us shudder at the thought. These are things we don’t ever want to think about—but here we are, in a very compromising situation. Perhaps your landlord has sent you a notice to terminate your lease, yikes! Once that happens, you’ll be asked to remove your things and vacate the premises, double yikes!
However, before you make any moves, be sure to read your lease agreement on whether you’ll be responsible for any personal guarantees, property damage, cleanup costs, among others, because honey, knowledge is power.
Listen, everyone is human, including your landlord. Try talking it out with them to see if there’s any possibility of working something out. Given the times we’re in, they may be understanding and allow you to stay longer or pay your rent at a later time. You never know, your landlord may have a heart of gold. Explore the option to slash your rent by a certain percentage while we are still in a pandemic. Unfortunately, if they’re aggressive and have questionable moral character, they can take legal action against your business.
Don’t start packing up just yet! Let’s not forget about government aid. The Canada Energy Rent Subsidy (CERS) provides rent and mortgage subsidies of up to 65% of eligible expenses, covering part commercial rent or property expenses for qualifying businesses. There is also the Business Credit Availability Program (BCAP), which works with Export Development Canada (EDC) and financial institutions to help all businesses. BCAP provides a flow of cash to cover business operating costs. Canada also has other means of support that are tailored to specific sectors, individuals, and situations. It’s worth taking a look to see how the economic response plan can best serve you.
THE REMOTE REVOLUTION
In what looks like another wave, we have reason to hold our breaths from the ghost of corona present. We wish we were talking about a wild night filled with Corona beers. Alas, we are not. The world is adjusting, and we’ve entered a remote workplace revolution, and there are upsides. Considering the fact that small business owners cannot pay rent, many have had to make moves in the right direction. There are really great things about working from home— from small things like sipping a cup of tea while basking in the sunshine from your comfy chair to big things like saving time and money. There are benefits to think about, and we’re going to walk you through them. This way, dearie.
This is one of the most obvious benefits. With no small business rent, there are no rent-related problems. Crazy logic, huh? Or let’s say the office is open half the week—this still means cutting down on utilities, cleaning services, food, supplies, and Taco Tuesday. No more servicing paper cups in the water cooler or buying printer paper.
Working from home is also a factor in determining a company’s tax burden. In addition to payroll and sales, we pay property tax. During this time, Canadians can claim the “work-space-in-the-home” deduction if they work at home for more than 50% of the time or have a home office to meet clients. This can include rent, utilities, and supplies. Look on the bright side, there are some silver linings.
As small business owners work from home, we can get as comfortable as we like. It’s like having a private office rather than sitting in a cubicle where someone always borrows your stapler and never gives it back (Dammit, Irene! You are the worst). There’s also an increased productivity level, considering unnecessary busywork or meetings that no longer take precedence.
It has been estimated that remote employees show an increase in productivity by 35-40% compared to office goers. Research finds that remote employees take more breaks during their workday but are more dedicated during their work. There is extraordinary freedom to being able to plan out your day and have flexibility. By creating a routine that works for you, it can contribute to a healthy work-life balance. And we are down for that.
Skip Rush Hour
For those of us living that city life, we are no longer commuting to the office. That means there’s less stress on the streets. No more getting caught in traffic, dealing with road rage, and swearing up a storm. No more missed breakfast because you hit snooze 5 extra times. That time goes to catching extra z’s, eating a well-rounded breakfast, meditating, and reclaiming your time. They say time is money, and that is truth. Without all of that rush hour stress, you get to enjoy your sweet cat nuzzling your face as you eat Oreos and type away.
Hiring the Best of the Bunch
Let’s revisit those memories of getting chosen on teams for dodgeball during PE class.
All it takes is a quick look to assess who was good at what. Similarly, you can choose who’s on your team, and that’s a good thing! Maybe the missing piece in your business just happens to live in Antarctica. Hiring remotely opens up so many doors to growing your team in a whole new way and can save you big bucks. Perhaps your new employee will even teach you a fun fact or two about snowshoeing.
TOOLS OF THE WORKPLACE EVOLUTION
Working from home has never been more accommodating than it is today. There are so many resources for small business owners to use. Here are some of our recommendations to keep your small business and colleagues more organized and connected than ever.
Asana is a handy tool. You can set goals, put plans into action, create tasks, and add files. Although this may be similar to other team-oriented software, it’s beneficial in that it understands everyone processes information differently. With Asana, you can bounce between lists view, timeline, and boards to get the big picture. Asana helps your team strategize together, and feeling connected is essential these days.
Instead of hanging out in the break room, hang out in Slack. Slack is a popular team chat software that uses channels to create groups for everyone or a select few. The search function comes in clutch when looking for important documents or attachments at odd hours of the day.
Stay organized with Trello. Not only can your team use it to chat, but it’s also an excellent workflow management system where everyone can stay on top of things. Trello uses boards to categorize each project, and within those boards, there are cards with task lists and deadlines. What’s convenient about Trello is the cards can move from one section to another so everyone can get an idea of what’s going on. It’s sure to clear up miscommunication with how efficient it is.
The ever-popular and expanding Google offers G Suite, also known as Google Workplace. It’s integrated with all Google apps, which is great news considering how often they are used, and best of all, everything is in one place. A few notable mentions include Gmail, Calendar, Docs, Meet, Chat, and Drive. The world is your oyster with G-Suite.
Everyone wishes they had 20/20 vision and had bought up Zoom stocks, and there’s a reason they’re doing so well. Zoom, the cloud-based communication app, has taken businesses and schools to the next level of collaborative interaction. From one on one meetings to group video conferences that can host up to 500 participants if you ever need, it’s a great way to keep in touch with big and small teams alike. And who knows? You can use it for a COVID safe virtual date.
Ah, our favorite and very relevant tool. We can’t stress enough that automated accounting makes life easier and who doesn’t want that. Save time and analyze and plan instead of doing busy work. There is so much software to choose from to suit every need. Why not check some out? For starters, we recommend looking into Quickbooks, Wave, or Blackline.
Small businesses all over can’t pay rent due to COVID-19.
Yes, the world’s a weirder place than ever. No, your small business/ life isn’t over. Actually, things have become both beautiful and ugly at the same time. You know those videos of people in Italy singing on their balconies together? I mean, come on, what a moment (tears). Those Gen Zers are delivering groceries to the elderly, so they did not have to leave their homes. People sewed thousands of masks for essential workers and donated them. Among all that beauty is a little bit of ugliness—like paying for rent for your small business when times are tough. That might mean having to let go of your office space or send your landlord a few dozen of your peanut butter ganache morsels to really butter ‘em up.
As we deal with these issues, let’s remain classy. Classy as in dab your mouth with a handkerchief after dinner, not wiping your Cheeto crumbs on your hoodie. As we look for ways to support our businesses, remember to stay mindful of how we approach our finances… that means keeping your books in order, especially if your rent sitch has changed. Look into the automated accounting tools we’re head over heels with.
If you’re not into that, everyone at Alchemy Accounting is here to lend a helping hand. Just give us a ring, ding, or ping on that mobile thing you carry, and we’ll be sure to answer. Times are tough, but this is a revolution. You ready?