How to Minimize the Effects of COVID-19 on Your Business [+Infographic]
The spread of Coronavirus brought a wealth of challenges for the leisure industry.
The uncertainty around travel regulations makes it hard to plan any sort of trips or leisure activities, with businesses like tour operators and restaurants taking the hardest hits.
We recently ran a survey with 100s of tour and activity providers. Unsurprisingly, our respondents reported significant declines in both bookings and website traffic. In addition, cancellations are on the rise with revenue from previous months being wiped away.
So what can you do in the face of declining bookings and increasing cancellations?
We prepared a list of best-practice ideas to help you handle the Coronavirus situation.
We all know the preventive measures to contain the virus on a personal level. Think of the actions below as similar guidelines but for your business.
Let’s get to it:
Promote Gift Vouchers
While we’ve seen a big decline in overall bookings, gift voucher sales remain relatively stable. They can be redeemed at a later point so it’s less risky for consumers to make that decision.
If you’re looking for a quick way to boost cash flow, consider promoting gift vouchers on central places on your website and other channels. This will increase the likelihood of people making a purchase so you can make it through these difficult few weeks.
With Regiondo, you can activate gift vouchers and highlight them on your website so it’s the first thing your customers see. Click here for a step-by-step walkthrough.
Use Value Vouchers as refunds
As cancellation requests mount up, consider offering value vouchers instead of cash refunds.
Value vouchers have a monetary value (that you set) and they can be used at a future date. Think of it as credits for buying your services in the future.
So if you receive a cancellation request, ask the customer if they would like to receive the refund via a value voucher. Consider increasing its value so there is an extra incentive for customers to accept this form of refund. For example, if they spent 100 EUR initially, you can offer them a value voucher worth 120 EUR.
Yes, it could eat into your profitability in the future but it can help you in the short term so this crisis goes by without long-lasting consequences.
You can choose the value voucher option when you cancel a booking in Regiondo. Click here for more details about value vouchers.
Alter bookings to a different date
Another way to turn around a cancellation request is by altering the booking to a future date.
This might be a viable option for locals or people who changed their flight tickets.
In order to make this a more attractive choice for customers, consider upgrading their booking where possible.
Do you need help with any of these features? Book a free consultation with a Regiondo expert here.
Utilize employees in other roles
If unpaid leave isn’t an option, think of ways to improve neglected areas of your business with help from your current employees.
As fewer and fewer bookings come in, retraining your staff in new skills can prove useful during the crisis and later down the road.
This is a good time to review things like Standard Operating Procedures (SOPs), sales and marketing activities so you are ready for a strong start once the crisis is over.
And if you’re paying salaries anyway, you might as well use the opportunity to improve areas of your business that don’t require customer interaction.
Negotiate your rent terms and supplier payments
If you’re renting an office, this might be one of the biggest expenses putting a strain on your budget during the next 1-2 months.
Try to negotiate a future payment with your landlord in a bid to reduce immediate expenses.
And this is also in their best interest. After all, if you leave or go out of business, they will lose their tenant and might have a hard time finding someone else.
It’s a similar situation when it comes to other suppliers – try to negotiate payment terms so you minimize current expenses. They might be willing to postpone payments to a future date or at least give you a discounted rate for the time being.
Review your financing options
While you don’t want to get to that point, if worst comes to worst, you need to be prepared with alternative financing options.
This could be loans or ideally government grants to get you back on track. No one expects this to last forever and many governments throughout Europe are now offering subsidies to get businesses through the crisis.
So spend some time now to consider your financing options so you’re prepared if things get to that point.
These are just some of the measures we’d recommend to cut costs immediately and try to boost revenue.
As the situation develops, we’ll keep posting new information to help get our customers and community through these tough times.
In the meantime, follow your government’s regulations and remember to always put your customers’, staff and personal safety first.
We ran a survey with 75 tour and activity operators about the effect of COVID-19 on their business. Below is an infographic summarizing the results: