The ongoing COVID pandemic is turning everything in the business world upside down, threatening to irreparably harm such major industries as travel and hospitality, healthcare and retail, to name just a few. According to a recent U.S. Census Bureau Small Business Pulse Survey, 51.4% of respondents expect it will take more than six months for their businesses to return to normal. The McKinsey Global Institute and Oxford Economics projected a longer recovery period, estimating it will take more than five years for most businesses to recover and even longer for some small businesses.
Yet, there are some businesses that are actually flourishing during the current crisis. Think of all the home improvement retailers, the manufacturers of cleaning and disinfection products, and online giants like Amazon.
Some of the ongoing business success stories are simply based on luck. These were the businesses that just happened to make the products that are most in need during a healthcare pandemic. But other successes showcase the importance of a business owner’s ability to pivot operations to create a new business model—one that is more in line with changing customer needs, attitudes and spending patterns.
The examples are all around us. Look at local grocery stores, for example. Many have quickly ramped up their delivery options, promoting both curbside pickup and home delivery. Many restaurants fall in this same category, quickly evolving to accept online orders and partnering with other businesses, like Uber Eats, Grubhub, and DoorDash, to safely provide home delivery. Some restaurants have additionally pivoted to become markets where they sell pre-packaged food. Others are packaging ingredients and instructions for customers to prepare their meals at home or are offering online cooking classes.
On the manufacturing side, we saw businesses that typically manufacture alcoholic beverages transform their operations to manufacture hand sanitizers.
These are all examples of ways that companies have successfully pivoted to align with trends that were created or intensified by the pandemic. What could your company be doing or offering differently to support the current trends of remote working, social distancing, increased online shopping, etc.?
The key is to be creative and flexible in your approach. Involve others in your brainstorming, including employees, suppliers, and other area businesses. Talk to your customers and truly listen to better understand their pain points and immediate needs.
More specifically, consider the following tips for helping to pivot your business effectively (including some tips being promoted by uschamber.com:
- Invest in your website and improve your overall online presence. This is the first place where many prospects look. And during a pandemic when fewer people are risking in-person shopping, the Internet may be the only way to get their business. So, make sure you make it easy for customers to find and buy online what they need from you. Be certain your site is mobile friendly and credible, possibly with the addition of ratings and reviews. According to eMarketer, e-commerce will reach 14.5% of total retail sales by 2021. This trend is expected to continue beyond the COVID pandemic as people have gotten hooked on the convenience of ordering online and having products shipped right to their doors.
- Expand your service offering to include more to-go items, delivery options and pickup alternatives. If you didn’t previously, consider adding free local delivery of your products.
- Market and effectively package your expertise. For example, some gyms and fitness centers are now offering yoga and kickboxing classes online. Beauticians are providing online styling tips, for a fee. And local chefs are teaching cooking classes.
- Consider going mobile. A number of pet groomers, for instance, have found instant success by packing up their equipment in a van and going to customers’ homes for grooming appointments.
- Add outdoor options, as possible. Restaurants aren’t the only ones to have benefitted from switching their services outside. Look at ways to sell your products in a more open environment where customers are more comfortable in shopping.
- Carefully consider your assets and how they can be adapted. This isn’t necessarily a time to completely switch businesses. But build on your strengths. If you’re a manufacturer, consider what other items you could be manufacturing that are in high demand currently. Or perhaps you could put your skills into other projects. With more people staying at home, for example, perhaps your team could be building more decks or gazebos.
Beyond looking at how to pivot your product or service offering, be aware of changes you can make to reduce costs. One option might be to permanently move your workforce to a remote arrangement which would save costs on rent, utilities and transportation. Now may also be a good time to talk to your lender about various financing options and arrangements to make sure you’re getting the best rates and terms.
The current COVID pandemic has forced us to re-evaluate so many aspects of our lives and businesses. But that doesn’t mean you can’t still be successful and find a way to keep your business doors open. It might simply mean you need to pivot.
The information and recommendations contained herein is compiled from sources deemed reliable but is not represented to be accurate or complete. In providing this information, neither Cortland Bank or its affiliates are acting as your agent or is offering you any tax, accounting or legal advice.