For employers, we are getting more detail on the payroll subsidy:https://www.singleton.com/2020/03/covid-19-the-canada-emergency-wage-subsidy/
- $847 per employee per week or 75% of up to $58,700 salary, whichever is less
- Still retroactive to March 15 (so far)
- Expectation is that you don’t cut employee wages
- Business must demonstrate/prove a minimum revenue loss of 30%
- Federal government will be introducing severe penalties for abuse of the program
- Application process expected to be announced within the next 2 weeks
- No limit on business size
For those who were considering using the job-sharing option, this is now, for most businesses, a better option.
Next Steps: I have started building detailed 90-day business financial plans for some of you. This provides a specific list of actions based on your own financial P&L statements that includes estimating the impact of using the government programs and includes a list of other actions you can do to help your business weather the storm. If any of you are interested in having this done for your business, contact me.
If any of you will need a business loan to survive a prolonged event, but would not otherwise qualify for a loan, there is money available from the government. https://www.bdc.ca/en/pages/special-support.aspx.
Small businesses with a payroll between $50K to $1M should look to the Canada Emergency Business Account https://www.canada.ca/en/department-finance/news/2020/03/additional-support-for-canadian-businesses-from-the-economic-impact-of-covid-19.html As described in my emails last week, this if interest-free, $40,000 where you can be forgiven up to $10,000 if you pay it back before the end of 2022.
Here is a description of the application process and the questions you will likely be asked https://www.krp.ca/lending-rules-for-bdc-covid-19-relief-program-take-shape
This is the last week you have to re-plan your businesses for the next 2-3 months to stay in front of the situation. If you don’t know what you need to be doing and how much of it you need to be doing, please contact me. I want to see you all survive this event as best as possible!
Next 2 weeks, the focus will need to shift to full-implementation of that plan and start looking for short-term business opportunities with customers who are less impacted by COVID-19. This is a very tactical that looks a lot like war-time situation management. Even with a plan, the situation going forward will be fluid (some good, some bad).
Later in April, your planning will need to focus on re-positioning your businesses to be ready to sling-shot out of this event!
Please continue to pay strict attention to all of the hygiene/safety recommendations and emotional/mental health issues discussed here over the past two weeks! Let’s do everything we can to keep our employees, customers, suppliers an colleagues healthy so we can all get back to work faster!
Pete Baran | 403-973-3531
Chief Business Mechanic | Blueneck Consulting Inc.
www.blueneck.ca
