In today’s time liquidity is the lifeline. MSMEs need to conserve cash and reduce capex and wastage over wanted or excessive costs. It is time to separate the wheat from the chaff and go lean.

Task	Points to ponder	Comments / Next Steps
Which expenses could be reduced such as travel and marketing?	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?	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	Follow up where required
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
Go lean?	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