Making new business plans amid the coronavirus crisis – opinion

A business expert from Lahav, a branch manager from Bank Hapoalim, an interior designer and the owner of an architect firm explain how to cope with the financial crisis – and even emerge stronger.

Calculating taxes (photo credit: INGIMAGE)
Calculating taxes
(photo credit: INGIMAGE)
Bar Iliutovich
A Wave of New Clients as the Lockdown Ended
“I’ve been an interior design for eight years now. I’m a graduate of Shenkar College, and most of my business is focused on private homes and apartments. This year actually started off slowly in terms of workload, partly because the economy was sluggish after three successive elections. There was a sense that people were sitting on their money, and avoiding making any big decisions regarding purchasing property or investing in renovations until things cleared up. After that, when the coronavirus struck, it led to five/six projects that were incredibly close to the contracts being agreed being put on hold, which added to the pressure.
“I kept working through the major lockdown, partly because the construction industry is defined as a vital industry and partly because people were in the middle of renovations or needed to move house and the work had to be completed. Admittedly most of the consulting I did with my clients was over the phone, but there were days that I had to go out to on-site meetings with contractors and tradesmen.
“The surprise came at the end of the lockdown—the projects that had been put on hold beforehand came back in a big way. There was a sharp increase in the number of approaches and interest from new clients. What’s the explanation? People were stuck in their homes the whole time, and that exposed things they were unhappy with and wanted to improve about it. For example, when restaurants are not an option, you realize the kitchen isn’t really fit for purpose. It really brought a lot of emotions to the surface for people. I had clients tell me ‘our house drove us crazy during the pandemic, and we want to be better prepared for the next lockdown, if there is one.’ That’s something I take very seriously about my work—helping people to feel more comfortable in their homes, with objects, colors and surroundings that are right for them. If you had spoken to me in March, I would have been sure things would have worked out the opposite, but reality has proven me wrong—which I’m obviously very happy about.”
The writer is an interior designer. Phone: 054-7751081
Eyal Itzkin
No One Is Issuing Permits
“Our firm has been running for 30 years and employs 45 architects and engineers. We primarily work on neighborhood building projects that are put out to tender by the Ministry of Housing and the Israel Land Authority in periphery areas. We are a big player in the Buyer’s Price program (“Mechir LaMishtaken”), for which we have designed 20 thousand apartments so far in Migdal HaEmek, Yokneam, Harish, Rishon LeZion, Yerucham, Jerusalem and Yavne, where we just recently completed plans for a project of 2,100 apartments. The coronavirus caught us in the middle of a strong period, with ongoing work on a number of projects.
“When the lockdown started, I furloughed 30 of my employees. Some of those who remained started working remotely, and the rest in the office, which stayed open. In a stroke of bad luck, all the public invitations to tender—including Buyer’s Price projects—were put on hold, and it’s unclear what the plan is for them. It is important to emphasize that throughout this period, I have kept paying income tax, national insurance, mortgages, wages and repayments on loans that I was forced to take out. So far, I have yet to receive a single shekel from the state. The situation has set our firm back by two or three years.
“When the lockdown was lifted, I brought most of my employees back from furlough, and the office also began to fill up again, albeit under the strictest possible interpretations of the ‘Purple Badge’ guidelines, with the exception of employees who were required to stay at home in isolation. We were ready to go full steam ahead—except there is nobody to talk to. Local councils are paralyzed, and planning and construction committees are not meeting to issue permits. The end result is that we have encountered a cash flow problem, not because of a lack of work, but because the authorities are not approving the plans that will allow us to move forward. And I mean a lot of local authorities, each with its own stories. We spend our whole time battling an unimaginably convoluted bureaucratic system as it is, going through a torturous process for each permit we try to obtain—and the present crisis has made that problem so much worse.”
The writer is the owner of “Itzkin Architects”
Shlomi Lahana
Design Home Workspaces
“The coronavirus crisis and the lifestyle changes facing us in its wake will result in significant changes in the labor market. Many employees are now having to work from home—whether by choice or not. At the same time, most of our homes are not suitably equipped with the necessary home office, and this is exactly the time for interior designers to launch digital campaigns, to reach out to people who are working remotely and to help them to convert spaces in their house into home offices and workspaces. Another important point: many interior designers adopt a ‘one-off’ sales approach, and fail to appreciate the importance of client retention—which is a mistake. You have to remain at the back of their minds at all times. Client retention management can take the form of a regular newsletter, text messages on holidays or even a phone call to assess their satisfaction with your work. All of these help to remind your clients of your existence for the next time they make purchases.”
The writer is a business strategy consultant and a lecturer in marketing at the College of Management.
Yaakov Tal
A Balanced Cash Flow Will Provide Breathing Space
“The business environment, which is not easy for small businesses at the best of times, has been further complicated by the uncertainty brought about by the coronavirus. In such situations, the natural reaction is to halt everything, bringing the economy to a standstill and suffering losses to income.
A majority of businesses require the oxygen of cash flow, which is the key to overcoming the crisis. There are two ways to balance the cash flow, and it is both possible and desirable to find some combination of the two. The first—reducing the regular expenses, cutting superfluous expenses and investments, attempting to reach agreements with suppliers regarding spreading out debt repayments, reducing payments on rent, delaying loan repayments and reducing purchases of supplies. The second, injecting cash into the business—whether it’s personal capital or from outside sources.”
The writer is the manager of the Mevaseret Zion branch of Bank Hapoalim