From One Indie Beauty Entrepreneur, A Rallying Cry For The Indie Beauty Community Coping With The COVID-19 Crisis
We are a week into having closed The Sunscreen Company’s offices in Ottawa due to the coronavirus guidelines issued by the Public Health Agency of Canada. The province where we are, Ontario, has declared a state of emergency. Our border with the United States has been sealed for anything other than essential crossings, a designation that includes trade. Scores of our retail accounts have shuttered their doors.
While there are moments I feel optimistic that we’re getting things done, I then project cash flow for the next few weeks and a rising feeling of worry settles in. Most of the company’s sources of income have dried up almost to nothing overnight. That’s thousands and thousands of dollars gone per day.
Indie beauty entrepreneurs know that growth is expensive. It’s a delicate balance between funding growth and sustaining a cushion of savings. How could we expect that suddenly our customers and staff would be not only housebound, but rightfully anxious about their own personal finances? I’m not sure if it’s a positive development that we are in this crisis together, but we are. Let’s make the most of our shared experience. Let’s rally our community of independent beauty companies to help each other out.
#KeepTheCashFlowing. That’s the idea. How do we retain any amount of cash flow between brands and their partners? None of us want to default on obligations. Can we help protect each other? We can if we outlay less by opting for payment installments or partial payments to smooth out the current cash crunch. Can we have frank discussions with routine suppliers and vendors that we typically pre-pay and prorate payments over the short term instead? For instance, would a brand consultant accept the division of a monthly fee into four to five smaller chunks spread throughout the month? Can we go to our landlords and ask to pay rent weekly so the big monthly bill isn’t as treacherous? We need to buy time.
I’m thinking of how I’m collecting cash from distribution partners, too. Can we afford to extend to our retailers, the ones in the thick of things, a little leeway? I would prefer to accept fractional payments on a schedule rather than moving to consignment ordering or credit term extensions to 90 or 120 days. We need to have just enough cash to maintain the proverbial lights on without shifting the burden to supply chain providers with punishing terms. We must get creative.
How do we retain any amount of cash flow between brands and their partners?
I’m taking this week to assess the state of our e-commerce sales. How much consumers are willing and able to buy is a big question mark. So far, we’ve had loyal customers shop from us online, especially locals who miss frequenting stores to replenish. After the week is out, my first round of calls will be to our landlord. Commercial real estate companies are going to be looking at office building and retail space vacancies exploding unless they do something. We’ve had initial conversations with retailers attempting to suss out the supply disruptions they can expect. They’re asking if our launches will be released as planned. Hopefully, they will be. Are we anticipating price changes? Maybe. Is there digital marketing support we can provide? I’m definitely evaluating what I can swing with the spring launches.
To date, there’s been no mention of pushing back orders. Everyone is waiting to get a sense of how protracted the coronavirus outbreak will be. Many of us are doing our best to compensate our staff for as long as possible. Payroll is a large expense, but we’re fighting hard to cover it. I’m hoping for government intervention from the government, but the extent of it and the pace of implementation is uncertain. We have to hang on to see how it will shake out.
I don’t pretend to have the answers. I know my fellow indie beauty entrepreneurs may have better solutions. Please speak up and share. Let’s not stay quiet in imposed isolation. Let’s focus on what we can do and realize that our success in this delicate ecosystem is tied to each other.
I’ve had to battle my own instincts to do the very opposite these past few days. I’ve been terse one minute and complete kindness the next. I’ve been excited about our upcoming launches and working diligently to push production full steam ahead, but then overwhelmed with concern that no one will purchase them when they’re ready. I’ve tried to be present for my kids who are at home with me as I try to squeeze in work. I’ve hugged them tighter while keeping socially distant from everyone else. I tell myself to concentrate on putting one foot in front of the other. We’ll all be stronger if the indie beauty community did that in lock step together.
So #KeepTheCashFlowing. Share your thoughts in the comments and on your own social media platforms. Stay safe and be well friends, and we’re all going to be standing on the flip side of this curve.