If there’s anything 2020 has taught us it’s our propensity for resilience and agility as we switch lanes, change plans, and pivot to accommodate this ever-changing landscape. And small business owners are at the forefront of this movement. With over 30 million small businesses in the U.S they create 1.5 million jobs annually (that’s 64% of new jobs created), so it’s critical that we provide the support and resources they need to get through this unprecedented time. 

So, how do we rewrite the rule book and map out a new path through this “new normal”? Mentorship is key to helping the small business community to pivot and move forward to not only survive but thrive right now and in the future. To help, we tapped Ginger Siegel, the North America small business lead at Mastercard to answer your questions in real-time during a digital mentor session at our recent Self-Care & Beauty Digital Summit.

In case you missed it, we’re sharing some of her impactful answers from the mentor session below. 

When launching a new brand how do you decide how to allocate your limited financial resources?

I think what's most important here is to have a business plan upfront and really prioritize what you want to do with your brand. That becomes your roadmap for how to spend the financial resources that you have.

One of the most important things these days is to make sure that you can sell your brand, sell your product, or service through the right channels. We know that digital is the way everything's going especially during COVID so having that business plan and prioritizing it will really guide your path. 

While some states are allowing restaurants, gyms, and shops to reopen, many small businesses are still struggling financially. What tips can you share on how to stay afloat during this time?

Where we've seen the most success is in the ability to pivot. We know that there's about 30% of small businesses that are not online today. The pandemic has seen more people choosing to do things digitally—to buy things online and sell things online. So number one, make sure you pivot to digital. 

Number two, there are a lot of resources out there. There are organizations called Small Business Development councils, and they are available in just about every town and city that most of you are probably in. Contact them! There are more grants available than you would imagine.  

There are also community development financial institutions. Google that in your area. Many of those institutions have grant money available. Take a look at your expenses and decide what you absolutely have to keep spending on and the things that are maybe’s. You should curtail those as well. 

How do you create a selling strategy for a truly luxury brand and what's the difference between a mass-market strategy and a luxury strategy?

People's definition of what a luxury item is different. So, really understand your market. It's really important to understand how your product and service fit into a number of different groups. Could you make the brand more every day, especially in this environment?

What are the key changes that small businesses will need to make in order to succeed? 

The number one thing is to have different channels. We have found that a lot of businesses were just catching the storefront and did not have a way for people to buy online. So, how can you reach your customer base in a number of different ways whether it's online or virtually?

Another thing we are very focused on at Mastercard is how people want to pay. Giving someone the option for checks and cash is not optimal. A lot of people want to stay away from that now. So, focus on contactless payments, and make sure you’re able to take payments over the phone or digitally through something we call “card on file.” 

Make sure your customers can keep their card on file so they can make repeat purchases easily. The other thing is contactless payments. If they do come into your store or restaurant, whatever type of business you have, this method allows the customer to keep hold of their card and just tap to pay. 

Mastercard just built and rolled out a program called Digital Doors because we want to help businesses get online and digitally transform their business. Through this platform, we’re helping small businesses build and protect their online presence with end-to-end digital resources like cybersecurity vulnerability assessments and digital skills curriculum.. We bundle all that together because we think getting online and being digitally enabled is really going to be the most pivotal change that small businesses need to make. 

I want to support my local small businesses. Do you have any tips on how or where can I find out which businesses are open right now near me? 

This question is near and dear to my heart. We actually just launched something called “Shop Openings” which is a customer-facing website where you can search geographically for small businesses in your area. It will tell you if it's open and if they accept contactless payments. So we're really proud of it. We think it's a wonderful way to drive people back into small businesses and we absolutely encourage all of you to use it for your local small businesses as well.

Besides loans, what can be helpful or beneficial to small businesses? 

Grants. There are a lot of organizations out there. I mentioned the community development financial institutions earlier and the Small Business Development councils, but there are organizations like Hello Alice that we partner with as well.

If you just go online and look in your local area, you will see a lot of organizations that do have grant money available. I happen to live in Westchester, New York. There's a fantastic organization that I'm on the board for called The Women's Economic Development Council and they definitely have grants available and a lot of free resources to help, so I encourage all of you to do that.

What advice do you have for someone who's thinking of taking their side hustle full-time and or starting their business during this time? 

One of my favorite books for people that want to start a business is called The E-Myth Revisited and I'll tell you why I love it. It talks about the fact that if you're someone who has a side hustle—whether it's baking or building apps on the side—there's a tremendous opportunity to take that and make it into a business. But so many entrepreneurs don't get into business to do all the tough stuff. That's not as much fun right? Dealing with the financials, actually managing overall finances and getting customers—those are all things that aren’t as much fun and the E-Myth walks you through that.  

Because even though you went into it to do something you love, you have to be willing to like something you don't love and that's the other side of the business. I think it’s really important to make sure that when you go into this, you go into it with your eyes open. When it's a side hustle a lot of times you don't think about that.

What are the top three actions I can take to build a network of other small business owners and advisors to learn from during these times? 

This might sound like a broken record, but one of the things that I'm most passionate about is LinkedIn. LinkedIn provides the opportunity to join groups with people who probably have very similar businesses like you and very similar problems. Joining these groups will really provide a very broad support system.

The other thing is associations. Whether you're in the restaurant business or the beauty business, there are a lot of associations out there and not-for-profits that are built to help businesses like yours today. These are both great resources to build a network.

Female entrepreneurs are looking to network with other female entrepreneurs and that's why we're so passionate about the space. We really build communities around this to help further knowledge, advice, and guidance so that people don't feel alone these days. 

How can I ensure my evolving brand story resonates with customers as I pivot and reinvest my business?

Create a following of people that love your brand. You're not pivoting away from your brand, you're pivoting the message to your customers. Always stay true to your brand. That’s critically important. Stay true to the things that really made you what you are today. And when you talk about pivoting it's really around the channels, or it might be some of the products you're selling but your brand needs to stay the same because that's what you built yourself on. 

If I'm going to reopen, what do I have to do?

There are some very excellent guidelines out there from the CDC around reopening. I had the opportunity to speak with some amazing women in the industry and one of the things that they really hit home is that when they were looking to reopen, they really focused on the safety and health guidelines. That's really important because you want your customers to feel safe. So I think step one is to really make sure you're looking at the recommendations and guidelines that are out there from the scientific community like the CDC. 

Secondly, really take a look at your product set. Is everything that you offered before going to be important going forward and do you have to pivot some of the things you were offering? So, again pivoting not necessarily around your story, but around the things that you've offered in the past. I think that's really important.

Do you have any easy, go-to tips on how to improve and manage cash flow as a small business owner?

If cash flow wasn't a problem for you before, then COVID has really created some difficulty. Interestingly enough the average small business owner only has 27 days of cash on hand. The other thing that I would say is that a lot of businesses are still using Excel. So there are a couple of things I want to recommend to you. Number one is to make sure that you have the right financial systems in place.

Now is the time to step back and do some improvements in your business. I encourage you to look at things like QuickBooks and some of the accounting software programs out there. We know that about 70% of small businesses actually send out manual invoices. So there's a great opportunity now with some of the accounting software packages out there to actually digitize your invoices. Because if you can get an invoice out in a day versus a week, imagine how that can really increase your cash flow.

So, understanding your cash flow, understanding what money you have coming in, and getting that money to come in quicker (and also the money you have going out) to make sure you really understand the billing timing. When you match the money coming into the money going out, that's really what cash flow is and there's a great opportunity for many businesses to manage it even better. 

What are the biggest financial mistakes you've seen small businesses make since the COVID-19 crisis hit?

There’s a couple; one of them in regards to cash flow. I find that a lot of businesses haven't really gotten their financials in order so when they did need to get loans or some type of credit, they really weren't prepared to tell their financial story. That's why I believe so strongly in making sure that you have the financial tools in order to do that.

A lot of people were hoping that this crisis would just go away. That's why we're really encouraging businesses to look at things like online and creating a digital storefront to get your services and your products online. You have agility as a small business and you can zig and zag much better than some bigger companies so keep that agility moving constantly, make the changes and get the help that you need quickly to make them. When you are willing and able to move quickly lots of things can happen in a really good way. 

What advice do you have to plan and pay for a reopening? 

Unfortunately, in some areas businesses were allowed to reopen, and then due to a resurgence, they closed again. I believe that for some businesses when things go backward they tend to get paralyzed. Now is the time if you haven't reopened to think about and plan for when you do. What are your safety and security plans? What do you have to do differently in terms of re-setting up your business? It is going to be like opening for the first time but remember, this time your customers already know you so you're not starting from scratch, you’re not starting from square one, you're starting with a brand that people in your community love. I encourage you to use social media. We think that there's a lot of focus on social media. 

What resources and publications should I work into my daily routine?

To stay up to speed on trends and pivoting during the pandemic, check out the various online resource centers. We set up one called the Mastercard Main Street Resource Center that really gives you access to a lot of tools and resources. And our partners like Create & Cultivate who has a tremendous resource, Hello Alice, or the SBA. So I would encourage you to Google some of these Resource Centers. They have a wealth of information for free to really help push you through this.

I think one of the best-kept secrets is organizations like the Small Business Development Centers, they all have websites, and if you take a look at those websites and you can actually call them. I think a lot of them are either back in the office or working virtually. So there are a lot of resources available. Sometimes people get paralyzed and think “I'm out here alone” but you are not out here alone. 

As a self-funded founder, should I stop paying myself during this time to keep my employees?

That’s a tough question. You have to know what your financial situation is and look at the length of time that you can survive with the cash flow that you have. I think it's a really difficult time and it's hard for me to say without looking at your financials. But I encourage you to work with your bank and work with your CPA to really understand where you are. And if you've been self-funding up till now, and you want to keep operating that way, then you might have to give thought to some additional sources of funding.

Do you think rent forgiveness is going to happen again? 

It's easy to focus on the things that you can't control and that's one of them so, I encourage everyone to think about it. If in fact, rent is not forgiving, what will you do then? You have to really look at both sides of the story and be prepared for either one. It goes back to the agility story that I mentioned earlier. 

I operate a social impact business that supports living wages for women in Ghana. What is the best way to create corporate partnerships and are there specific departments or job titles I should seek to identify the right person in a company?

 I tell you one of the reasons I'm so proud to work for Mastercard is that we are very focused on doing well by doing good and I think that most companies that feel that way will put that out there. We have done a tremendous amount of work for our center for inclusive growth. I think that financial inclusion is two words that you can Google in terms of different corporations.

If you are looking to partner with a company, you want to make sure that they have the same values as you do. That is why we at Mastercard are able to attract such amazing partners, like Create & Cultivate because we all believe in the same thing, which is helping others do well by doing good. So I would encourage you to look through financial inclusion.

Look at some of the major corporations in your area, and really dig in and look through their annual reports. Look at the kinds of things they talk about. These days there are a lot of great companies out there that are doing really great things.

I love your partnership with Create & Cultivate. It feels really authentic. How do you choose your partners?

Mastercard has a very strong focus on doing well by doing good so we look at partners that believe in that, too. It's really important to us. When we partner with organizations like Create & Cultivate we need to know that there's an authenticity, that they do care about small business, that they do care about minority entrepreneurship. It's also important to us to not just have people who say it but also show it and so we look at the work that's being done. We look at how that company represents itself.

We tend to attract really great companies that do that, too. So the partnerships that I mentioned before like Salesforce and Microsoft, are all great organizations that have a very strong approach to financial inclusion and caring. That's why we're really proud to be able to partner with them.

What are the three most important things to remember when first opening a business? 

This is one of my favorite questions. Number one is to read The E-Myth book. That's really important because a lot of people when they're looking to open their business are thinking about the thing that they love. So for example, if they love making ice cream or they love making specialty cakes or creating candles at home, think about the other parts that you have to do when you run a business, make sure that you can manage your financials, and create the right business plan. 

Making sure that you have a plan B should something happen like the pandemic. Really make sure you have a business plan that has the fullness to it—all the information that you need—and then really think about how you're going to fund it. Is it going to be self-funded? Is it going to be funded through friends and family? Are you going to get an angel investor?

When do you think is the right moment to open a business credit card?

Well, first of all, one of the things that I really encourage is to talk to your bank. And if you don't have a bank, it’s really important to get someone who can give you financial advice. Someone who can look over your financials to really help you decide when it's the right time. You know, we have many small businesses that might have started out with a consumer card, but now they need to separate out their business expenses. So, as soon as you can do that, really think about talking to the right people, whether it's a bank or some other great organizations that can provide credit cards for you.

We encourage people to work through those partners to decide when is the right time. It’s important to know that you’re not in this alone. There are some great credit unions, community financial institutions, and banks. There are many fintechs out there too that are able to provide credit cards. So, I would look at one of them.

Really focus and bring the right questions to the table so that you can decide. It’s probably not a decision that you're going to make alone. You're going to want someone to help you with that assessment of where you're sitting financially.

What are some of the smartest financial moves you've seen small businesses make in the midst of the pandemic?

Number one is this concept of pivoting. You know, how do we pivot during this time? And I think some of the successful businesses that I've seen did not wait. The other thing is having different channels. So, if you know that you deliver your products and services one way today, what are some of the channels that you could build in the future? Online is a very, very important channel. So I think it's really important to pivot and look at differentiated channels.

Any tips on how to embrace positive energy during this time?

I think it comes back to passion. I have been working with small businesses my entire career. I go to sleep at night feeling very sad sometimes because of the trouble and trauma that a lot of small businesses are going through but I wake up every day knowing that I have at least 10 hours to be able to think of something that could make a difference. I think that's where my positive energy comes from—the belief that I can make a difference, that I can spend an hour with all of you and hopefully you can walk away with one or two tips where you'll either feel better or do something different. 

Energy is critically important. This has been just a terrible, terrible time, but we will come out of this. We will come out of this on the other side strong because small businesses, all of you, whether you're in a small business or whether you're thinking of a small business, you are here today because you believe there's something more to learn. I would encourage all of you to continue to think positively, to continue to believe in what you're doing because what you're doing will help.

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