4 tips to manage top business concerns in 2021

Tip: Get help understanding the short- and long-term impact on your business 

When the pandemic began to affect U.S. businesses in March 2020, it was difficult for any business or organization to understand the long-term impact – many scrambled to transition to remote work, implement new safety protocols, and manage the day-to-day disruptions. In spring 2020, our survey found 75% of businesses expected a moderate to severe decrease in profits. In the summer, that number dropped to 68%, and then to 55% by the fall. However, the spring survey also found about 41% of businesses expected the impact of the pandemic to lessen by Q3 or Q4 of 2020 – but that optimism dropped dramatically moving into the summer. 

In the public sector, forecasting looked a little different. While many private sector businesses spent the spring planning for the worst-case scenario, the public sector was faced with meeting specific community needs, from education to transit to healthcare.

“So much of public sector revenues are already allocated for the year, and most state constitutions do not allow them to operate at a deficit,” says Kevin Smith, managing partner of public sector services at Crowe. “Without federal help, many organizations are about to experience significant problems and reductions in services. Unfortunately, that decrease will come at a time when people need those services the most.”

Regardless of your industry, the ability to forecast is critical to 2021 planning. Whether you’re public or private sector, you might see value in getting an outside perspective on how to best plan for 2021 – and beyond. Our post-election tax policy coverage can help you understand the changes your business might see during a Biden presidency – and develop tax-planning strategies accordingly.

Tip: Focus on your core business areas   

While our survey showed significantly more optimism in the economy as the year progressed – and in fact, many businesses found their revenue was at or better than anticipated – that data reflects only a piece of the whole economy.

“We can’t forget that this survey went to employed, executive-level professionals,” says Lathrop. “The stark reality is that this crisis feels very different to different people.”

For businesses facing decreasing revenue, this year has forced a level of focus. Many didn’t have the luxury of supporting every area they had in the past and had to review areas that were not growing or contributing significantly to the bottom line. Cutting out underperforming products or services can help stem declining revenue, as well as offer businesses the ability to get back to the roots of their initial successes. 

Most organizations also pivoted to finding – and keeping – liquidity in every area of their business. Our liquidity series walks you through the key steps to creating a resilient business model as you move into the new year. 

The impacts of 2020 are still with us, but we’ve also gained knowledge that can help you in 2021 and in years to come. Use these tips as a starting point as you decide how to move forward.