The Private Sector Organisation of Jamaica (PSOJ) in its continued effort to support small- and medium-sized enterprises (SMEs) and help them to navigate the challenges of the novel coronavirus disease (COVID-19), has advised the sector to preserve cash where possible in order to deal with any unforeseen circumstances that may arise during this period of uncertainty.

In an extended list of measures recently put forward by the entity, SMEs were advised to convert as much of their outstanding receivables and inventory to cash in the soonest time possible.

“Collect monies owed and sell out as much inventory as you can; having available cash will be critical in upcoming months — hence preserve your cash for the unforeseen,” the entity said.

With the deadly pandemic wreaking havoc on many economies across the globe, the PSOJ, through its access to finance panel, has remained committed to propelling the growth of the sector. They said that as COVID-19 continues to develop, it will restrict the supply chain of SMEs and also limit their business operations and erode cash flow, therefore SMEs are advised to secure liquidity.

The organisation warned that with the threat of indefinite closure becoming a harsh reality for many business owners, it becomes very crucial that small businesses, in drafting their contingency plans, to seek to ensure that proper measures are put in place to help them recover from fallouts that may ensue.

“Examine your monthly expenses with a fine-tooth comb; where there might be any unnecessary expense, cut it. Consider reducing your product or service offerings — where there are hidden costs to running a complex organisation, for instance having a restaurant menu with 20 items, consider reducing it to your top eight most popular items,” the PSOJ advised.

“Negotiate with your bigger suppliers for some more flexible payment terms in the near term [3-6 months], even if it accrues interest.

“If you are considering layoffs but not closing completely, consider the possibility of keeping more people on at a reduced salary, as well as redefining the scope of work for some staff members,” the entity also advised.

The PSOJ is one of the bodies that has been leading the charge for growth and inclusion of the SME sector, based on the significant value that they add to the economy. Through the recent addition of a live business podcast, the organisation has strengthened its position on seeking to support the growth of the sector, facilitate collaboration of players in the local ecosystem, and helping the sector to overcome possible challenges, especially now, as the impact of the virus threaten to decelerate the journey to an SME-inclusive economy.