-
Which expenses could be
reduced such as travel and
marketing?
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- Which expenses could be saved?
- Which could be the additional
expenses?
- Which operations/line of
operations can be temporarily
paused?
- Which assets may not be
purchased currently taking benefit
of reduced price?
- Focus on products that provide
more cash flow
- Have you considered reducing
your capex?
- Have you considered renting
less building space as per your
optimum needs?
|
- Important to analyse
how long the cash
resources will last and
consider availing financing
accordingly
|
- Would you like to take
a sensitivity analysis
or shock analysis to
help prepare better for
scenarios?
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- Analyse the impact of the loss of
a major customer or supplier or
the prospects of a drop in sales
by a significant margin of say
20%
- Prepare best and worst case
scenarios
- Consider the impact of COVID 19
returning again after a period of
time
- Consider the possibility of
developing new customers
- Consider the possibility of
developing new and lateral
products
|
- Consider worst case
scenario as well.
|
- Are you struggling
to meet the Delivery
Schedule in respect
of Government orders,
PSUs, Railways etc.
where Liquidated
Damages (LD) clause
may apply as per
contract terms?
|
- Are you in a contract where
Liquidated damage clause is
applicable? If Yes, have you
proposing to take benefit of
DPE, Railway Board and other
Ministries having PSUs to be
approached to allow relaxation
in applicability of LD clause for a
period of from the schedule date
of delivery/execution of order?
- Consider that liquidated damages
clause works both for and against
you
|
- LD clause waiver in cases
can help avoid impairment
|
- Are you suffering due
to delayed collection
for supplies made
to any Government
department/PSU
|
- Government is proposing that
DPE, Railway Board to be
approached for immediate
intervention and release of all
pending payments by CPSEs and
Railways to the MSME, even if
the related matter is pending with
MSEFC
|
|
- Are you worried about
meeting fixed costs
including on leases?
The most emerging
challenge during the
lockdown period as
well as in the post
COVID-19 period
|
- Negotiate rent agreements
applying the ‘Force Majeure
clause’ implying treating COVID
19 as an Act of God
- Consider that the ‘Force Majeure
clause’ works both for and
against you
|
- Keep bankers informed of
your efforts and look out
for reliefs offered by state
governments.
|
- would be meeting
fixed costs. While this
will be burdensome
in absence of regular
funds flow, the problem
will be more intensified
if Banks/NBFC create
pressure on MSMEs
for repayments of the
dues.
|
- Consider lease break options
- Explore payment deferrals
- Explore lean manufacturing
by sharing infrastructure like
packaging facilities
|
|
- Are you facing an
escalation of product
Prices? In the post
COVID-19 period
|
- Yes/NO. If yes, then need to
represent with CBIC for reduction
in GST Rate or search for
alternative vendor for continuity
in supply of products
|
- Consider sourcing locally
and reducing cost
excesses
|
|
- Use the optimal level of staff and
other resources like water, gas,
electricity, fuel etc.
- Switch to more local suppliers
- Identify inefficiencies
- Waste recycling to reduce costs
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