Small business owners across the country and around the world are modifying their business plans and pivoting on the fly in a desperate attempt to scratch out some revenue.
I’m sure that we’re all very well versed on the dire omens this pandemic has delivered, but there’s a positive side as well: It’s forcing many of us to re-examine what we’re doing and experiment with new ideas.
Pivoting Business Strategy
“We’re not going to go back to the way we did business a year ago,” investment guru Mark Tepper, president, and CEO of Strategic Wealth Partners, told business show host Stuart Varney recently.
This sets us up for the question: Are you taking advantage of these extraordinary times to be ready for the new ways business will be conducted after the COVID-19 storm dies down?
I’m reminded of some decisions Jimmy John’s founder Jimmy John Liautaud made when he first opened his sandwich shops: “His shop wasn’t in the greatest location, so he included delivery of his sandwiches to encourage sales. Jimmy John’s Gourmet Sandwiches turned a profit by the end of the first year.”
I cite this example because if your email in-box resembles mine at all, you’ve been receiving regular emails from local restaurants that have added delivery to the services they provide. I might add that in many cases, they are using one of the new gig-economy services, like Uber Eats. I’ve talked to various foodservice professionals, and they usually only begrudgingly team up with one or more of these new services – having in-house control of delivery can improve profitability.
The point is that starting up a delivery operation isn’t as simple as slapping a magnetic sign on the side of an employee’s car and heading out on the road: online ordering, staffing, packaging, insuring, and other details need to be seen to. This is evidenced by the fact that I’m still getting emails announcing new delivery services many weeks into the coronavirus shutdown. For many restaurants, working with an established service will be the first step.
For this reason, we should embrace the challenges of this trying time to rethink business models and try new ideas. We know that demand will be fairly low so our investments will be correspondingly low…and our failures won’t be such a big deal. I’ve already discussed delivery, so here are some other avenues to consider.
Seniors and folks who are on immunosuppressants or have other conditions have been advised to be especially cautious and to wear masks when venturing out on necessary errands. However, it is virtually impossible to buy masks through the regular channels.
Many Etsy vendors, however, have been able to immediately pivot to making dust masks in a wide variety of colors and patterns. In fact, most are offering same-day shipping. This is a beautiful example of how small businesses are able to meet a sudden surge in demand far more quickly than big business.
Examine your business. Are there niche markets that you are overlooking? Compare what you do to the bigger companies in your sector. Who will they not bother selling to? Today is the ideal time to reach out to markets that you may have previously seen as not large enough to bother with. What do you have to lose?
If you are a manufacturer, look into 3D printing ideas. There’s a good chance you have time on your hands; why not use it to explore a new technology. Have some on your team figure out the technical side, while your marketing people explore where they might sell new, custom products.
Expand your staff
“Wait a minute,” you say, “aren’t small businesses either laying people off or taking loans from Uncle Sam just to meet current payroll? How is it possible to expand?”
If you haven’t done it yet, look to freelancers to add talent to your operation. They are the experienced work-from-home pioneers.
However, the thing about relying on freelancers is that you need to build relationships to achieve comfort and success. Honestly, I know some freelancers who have been so overwhelmed with work during the current shutdown that they aren’t taking any new clients.
You may be able to connect with good freelancers through local referrals, but for the most part, the various specialized freelance sites, like Upwork, Fiverr, Freelancer, and Toptal, are the best way to get started. Check out Fiverr for smaller jobs, Toptal to connect with tech gurus for big-ticket projects, and Upwork and Freelancer for everything in between.
Develop multiple sources
There’s a guiding principle in manufacturing: Have multiple sources for any mission-critical component. On a national level, we seem to have forgotten this and allowed China to be our single source on a wide array of products, including some critical pharmaceuticals and health-care items.
Take this slow time to re-evaluate your supply chain. Do you single-source anything? I have no idea what our trade relationship will be with China post-COVID-19, but there is certainly the potential for things to get dicey. Further, the pandemic has slowed down or halted a lot of otherwise reliable sources. It’s prudent to investigate other suppliers and strike up new relationships.
You might also consider taking on the manufacture of critical components yourself, purchasing stakes in companies that you depend on, or expanding by acquiring a critical supplier.
Let me make one more suggestion before we leave the topic, and I’m going back to the Jimmy John’s example I cited at the top: Give away samples.
Look, you probably aren’t making much money now anyway and there’s a good chance your staff is minimal. Free samples cost very little – they won’t hurt your already bad bottom line too much – and they set you up for a strong rebound coming out of the shutdown. They are a great way to make new friends and spread the word about your business.
Service providers should consider this as well. For example, a local cleaning company could provide some free home disinfecting visits.
Be creative and shine like a beacon of hope in this unprecedented age.
Change is a constant force and the businesses that can adapt to thrive in the changed environment will win in the long run. Good article.