A Pandemic Story: The Operations Perspective of the COVID-19 Environment

Emma Hart of Sallyport Commercial Finance takes us back a year and explains how the operations team at Sallyport Commercial Finance dealt with the initial shockwave of the COVID-19 pandemic to keep employees safe while providing support for clients.

BY EMMA HART

When my colleagues at Sallyport Commercial Finance and I returned from spring break vacations in March 2020, we were returning to a whole new world. States and counties began shutting down and issuing stay-at-home orders, further precipitating a fear of the unknown.

What did that mean from an operations perspective for the company? First, we needed to take care of our staff. Second, we needed to take care of our clients and ensure we could provide the working capital they needed to take care of their own businesses and employees.

SUPPORTING STAFF FROM HOME

On the staff side, we deployed monitors and keyboards to accompany laptops, diverted phones to cell phones and set up home offices. Some of our employees also had to deal with school closures and a new dawn of home schooling.

We quickly developed a new and electronic approval process for outgoing wires to ensure our controls were not compromised and we used instant communication tools such as Slack to keep our team connected. Although the majority of Sallyport’s employees could work from home, there were aspects of the business that could not be handled remotely. Checks that arrived in the mail at our office and at our P.O. box had to be collected, sorted, saved and remotely deposited so there was no interruption to our clients’ cash flow.

As we conducted these initiatives, roads were eerily quiet, as only essential businesses were allowed to remain open. As an essential financial services business, our office was open daily, but only senior management was in attendance. That meant senior managers were answering the door and phone, opening the mail, and picking up and depositing checks.

As the weeks went by, some employees felt isolated and scared, while others felt safer and more productive than in the office. However, some employees felt the need to get back to the office and/ or find relief from stress related to childcare and schooling.

On one Friday afternoon a few weeks into the COVID-19 pandemic, my two teenage sons and I hand-delivered gift bags to the front doorsteps of all of the operations team with a message showing appreciation for all that they were going through and encouraging them to keep their spirits up. My boys literally were allowed to play “ding-dong-ditch” with full permission (and masks)!

On the client side, COVID-19 was taking hold and businesses were panicking about what to do. One of the first things to happen was a slowdown in our clients’ sales, which immediately impacted their cash flow. To make matters worse, customers would hold on to payments. No one knew what the future would hold or how these developments would affect business. The high streets were closed, and retailers were reluctant to pay invoices, as were many companies and industries.

This led to an immediate slow down of collections, a dynamic that shows up fast and furiously in a factoring portfolio. Understandably, clients were drawing all available funds while volumes were significantly down and collections were being impacted, resulting in debt aging out. Most AP departments (including Sallyport’s) were working from home, making it very difficult to contact people and to receive responses to calls and emails, leading to a perfect storm for delays to payments, approvals, check signatures, etc.

HELPING CLIENTS IN CRISIS

Despite these challenges, it was imperative that we did not stop trying. Cash going out and not coming in is not a sustainable business model and can lead to devastating consequences. We needed our operations team to continue to chase customers and provide a service to our clients, who were, aside from a few, all struggling.

Our clients needed our help. We reassured them we would be there to support them. We provided a moratorium for loan and interest repayments, waived fees and allowed for borrowing base governors to be relaxed. We extended recourse days and provided over-advances when needed. We talked to our clients and changed processes and controls, as their staffs were working from home as well. We were in it together with our clients and felt together we would get through it. We also were talking to our banks and investors regularly to ensure we had their support and remained transparent about what was happening to the portfolio. The risk in our portfolio was increasing, but we had strategies in place to deal with it.

As time marched on, we realized the best way to help our clients was to return to the office so there was once again collaboration, ease of communication, efficiency and productivity. Our clients and our company were coming out of crisis management mode and finding new and improved ways of working.

Most of our operations team returned to the office in late May. In line with CDC guidelines, we disinfected the office, brought in sneeze screens and changed the seating plan to ensure social distancing. We also introduced a bi-weekly COVID-19 testing protocol and travel guidance protocols to ensure everyone was protected. Immediately, productivity was enhanced, conversations were dynamic and client issues were promptly addressed and quickly resolved.

Without question, our operations team was resilient throughout those early months of the pandemic. They worked hard in very trying circumstances and they were responsive and reactive to our clients. This experience made us nimble to act so that when an asymptomatic COVID-19 positive case showed up in the office a month later, we immediately reverted to home working with all home office equipment for a two-week quarantine period — as was the recommendation at the time.

Right from the get-go, we qualified as an essential business, but we listened to and cared about our team, their individual circumstances and their fears. They, in turn, listened and cared about our clients, and we were able to accommodate and be flexible with the terms of our contracts to help our clients through this difficult time.

It is now a year later and we are gradually beginning to return to normal. The camaraderie that Sallyport’s team has is remarkable, especially now that we have navigated a pandemic together. We have implemented procedures to keep everyone safe while remaining flexible and supportive of one another and our clients during a crisis. Today, we are equipped, resilient and nimble enough to deal with what comes next.

Emma Hart is the chief operating officer of Sallyport Commercial Finance. Hart has a tenure of more than 30 years in the commercial finance industry. Prior to helping to set up Sallyport Commercial Finance, she held the role of executive vice president of operations with Bibby Financial Services (CA), Inc. from 2008 to 2014. Prior to joining Bibby, Hart spent 20 years with Lloyds TSB Commercial Finance in the UK. She can be reached at 832-939-9450 or at ehart@sallyportcf.com.