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Managing a cash crunch in the coronavirus era: flatten your own curve

One of the most prominent challenge small businesses are currently facing or will be facing in the coming weeks and months is managing a cash crunch. In the US, it was estimated that in 2015, the average small business had a sufficient amount of cash on hand to support 27 days of operations only. This falls further down to 16 days on average when considering restaurants (Farrell & Wheat, 2016). Staying afloat during these tough times will thus undoubtedly require a newly crafted strategy for generating cash before it is too late.

Even if your business has been put on hold by governmental decisions mandating a lockdown, you still have several options to generate revenues and pay your bills while your business can’t be run as usual. One of them is to spread revenues more equally throughout different time periods. Put differently, you can try to shift future revenues towards the present and generate part of them now in order to have a more stable revenue level across a couple of months or over the next year.

Flatten your own curve and spread revenues across time periods to match cash inflows and due dates

Let’s face it, it will be very difficult to get good results by the end of the year. Even though this should obviously not prevent you from putting all efforts towards this goal, you should definitely focus on the current period in order not to go under. Assuming you will not generate any revenues for the next two months and only have less than what it requires in available cash, you can implement solutions to sell now for future periods so that you can harvest the cash immediately and pay you current bills. This will not increase your sales – in fact it may even be necessary to decrease them – but it will allow you to match invoice due dates with cash inflows more easily and thereby solve at least partly liquidity challenges. Here are a couple of ideas you can implement in order to achieve that aim.

Pre-sale now

Pre-selling your products or services might not be that easy. But striving to do it will allow you not only to generate immediate cash for your business but also to foster customer loyalty. It first goes through effective online communication channels. Keep your customers posted on social media, keep them entertained and show them you are there. Foster customer relationships and let them know they might need to help their favorite restaurant – or whatever business you own – during these times. Offer them attractive bundles now; their favorite meals at a 10% discount, three entrances at your club for the price of two, a discount on the next exhibition if they book tickets for the first one within the next 10 days, and so on. Not only will it enable you to get quick cash, it will also enable you to ensure they have a foot in the door for when business as usual can resume.


Depending on your business, you might consider changing your pricing strategy and offer a membership model at a discount. Consider ski resorts for instance. Given the uncertainty in demand due to weather conditions and the important risk of disruptions, they strive to sell season passes at the beginning of the season to get stable inflows, even if day passes are proportionally much more expensive and profitable. While they use it to edge against natural risks, you can use the same idea as a response to the crisis, even if it is not usually observed in your sector. As a bar owner for example, you may want to consider that option.

Gift cards

Designing a range of gift cards is also an effective way to get cash early on. Use digital channels extensively to promote these products and put emphasis on them.


You could also decide to organize an online contest for a small fee. While many contests are now free, loyal customers might be willing to pay a small fee to participate if you manage to make them understand it can really help you go through this period. Creative contests can thus reveal to be a winning bet in order to get a little cash relief. A restaurant can for instance organize an online cooking contest and offer two free meals for the winner. Again, even though the small amounts you get might be significantly lower than the price you usually charge for the prize you offer, getting the cash now is what you care about.

These examples highlight that it is possible to flatten your revenue curve now in order not to run out of cash. Helping you doing that is among the free services we can offer for free at We match you with teams of talented students who are driven to showcase their skills and expertise to help you implement those solutions and go through this crisis as smoothly as possible. Don’t hesitate to contact us and request help; we are kind, skilled, and sometimes funny too.


Farrell, D., & Wheat, C. (2016). Cash is King: Flows, Balances, and Buffer Days Evidence from

600,000 Small Businesses. JPMorgan Chase & Co Institute.

Written by Alexis Raedemaecker, master student in management at Bocconi University and HEC Montréal.

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