Tomorrow I get rid of my warehouse which I have had for just on a year now. The reality is it is a cost and a burden we don't need right now and taking stock of where we are it is the smart move. This will allow us to reduce our overheads to nil and this allows us to ride the storm around us. Live to fight another day with out changing anything really so it is the right call. I want to remove any financial burdens we have right now as I am not paying for things I am not using. Others are doing the exact same thing as I have been asked by two mates if they could use the warehouse at mate prices "free".
A warehouse can be replaced as after this lock down period there will be many available. Our land lord wouldn't accept a rain check on the rent so we terminated the lease and gave him notice. The only thing to do is to move the fork lift to our factory in Durban until everything blows over. Everyone is in a similar position and think we are luckier as the operation is only little old me and no staff.
It took me months to find the right warehouse at the right price but price doesn't come into it now as the orders are non existent and the ones we have been asked to deliver we can't as our clients haven't paid. One of our clients whose account is up to date gave us a huge order today but we are reluctant to touch it. I know their financial position and it is not Dire Straits but who knows if they can pay in 30 days.
I am not a gambling person and I am not prepared to gamble the business on one account. My business partner doesn't need to have his arm twisted as he is thinking along the same lines. Cash flow would be screwed and set us back being tied up in stock. The right move is to hold back and lessen the risk I feel. Already we are seeing companies disappearing and we will make sure we are not added to the list.
I don't see this lock down ever opening fully until the end of this year as our cases are only now starting to climb. The talk is most places will open up and then shut down again which I think will make finances even worse. A business doesn't run on thin air and that is what most companies who aren't involved with online have right now.
We are small fry compared to the others in the industry and knowing we will see the other side in a much changed landscape excites me. I have heard of two competitors who have already hit the wall so who knows how many in two or three months time. I don't wish others bad fortune as that is not very sporting, but it will make my life a lot easier if we can thin the competition out. We may be taking a step back by losing the warehouse but I ain't losing my shirt over this and will be around for years to come.