Millions of small business owners across the world faced challenges as the pandemic shut down much of the world economy and consumers stayed indoors during global lockdowns.
The only winners have been the companies that had already started shifting years before the crisis towards a different kind of business models that can survive in the digital age.
Still, most of the small businesses have failed during this period.
The ones that survived had to innovate in the production, logistics and marketing department during the pandemic. This helped them drive enough revenue to keep the business going and generate new opportunities as the economy recovers.
That’s why I believe, Innovation, creativity and the development of new business models is the key to future business growth.
Small Businesses can survive during the pandemic, but the thing is… it’s going to take a lot more than government-driven financial aid to do that.
The real work has to be done by the business owners/ entrepreneurs/ business leaders.
From mapping out a new financial strategy to rebranding and changing your current business model, the work you do now could take your business to new heights in the future.
In this episode, we’ll dive into some common business strategies that businesses can adopt in order to survive and thrive during the pandemic.
So, the first business strategy which should be your first and foremost priority as a business owner should be to
Optimize the business finances
Financial optimization helps businesses generate revenue while minimizing input costs to achieve consistently higher profits in the short term and long-term, while simultaneously complying with relevant ethical, legal and financial constraints.
The financial health of a business depends upon how its assets and liabilities are managed both in the short and long term.
It’s important to understand that a business that ignores the optimization of their finances does not survive long.
So, how businesses can optimize their finances?
For starters you need to do is to understand your cash flow. According to a U.S. Bank study, 82% per cent of businesses fail due to poor cash flow.
That’s what makes it so necessary to implement systems to manage proper cash flow.
So, adopt processes that will help manage cash flow, automate payroll, and access capital. Adopt methods to make your company’s financial management more fluid.
Next, optimize how your money is being spent.
In these uncertain times, there is no better time than now to reevaluate how money is being spent in your business.
A great example of how businesses can better utilize their spending is maybe switching from traditional marketing methods to digital marketing.
By Investing in digital marketing, businesses can dramatically reduce the cost of their monthly marketing expenses.
Digital marketing also provides more targeted and precise reach when compared to traditional methods like newspaper ads or billboards.
Similarly, you will be able to find several ways to reduce your business spending.
Evaluate your monthly expenses and then see where and how the company can make cost-effective changes.
Optimizing financial management is a challenging task, especially for entrepreneurs who lack the necessary experience or skill regarding financial management.
But, that doesn’t mean you cannot educate yourself, or consult with professionals.
In these challenging times, the primary focus of every business owner should be to implement proper systems that will allow them to manage the business finances systematically.
Otherwise, the business will lose its health, competitiveness and permanence in the market.
Accelerate the digital adoption
The next big business strategy is to accelerate digital adoption.
Pandemic has led to a historic adoption of digitization in an unimaginable way. Data suggests that in a matter of months, we have jumped five years in consumer and business digital adoption.
We saw the historic deployment of remote work and digital access to services across every domain.
It transformed the way we interact with people, work, get medical care, entertain ourselves, and make transactions.
Online shopping has also become the main method of purchasing for consumers globally.
As a result, companies that had never considered going online were suddenly forced to digitalize their businesses.
Challenges Every Small Business face (and How to resolve them)
So, the core challenge of the pandemic for businesses has not only been to sustain productivity through digitized operations but to understand new opportunities brought by digitalization into the work and workforce.
Digitalization is now seen as a catalyst for change in the business model creatively for the better.
Now, businesses need to rethink customer journeys completely and accelerate the development of digital solutions. Of course, the emphasis will be different for each sector.
Like for example – A business that sells products have to create a seamless e-commerce experience.
By enabling customers to get everything they need through their online stores from initial research to offers and deals to purchase to service.
For the service and hospitality industry ensuring health and safety will be essential with “contactless” delivery and payment options.
In parallel to this use of data, the Internet of Things, and AI is also crucial for businesses to better manage their operations.
Changing the business model
With the volatile economic climate and the opening, closing and re-opening of the economy loop, it’s important as an entrepreneur to learn how to pivot.
What I mean by pivoting is that you shift to a new business strategy to address something that may not be working well within the business.
Pivoting can be something as simple as a company shifting its business from offline to online.
Or it can be something as complex as changing their entire business model.
But there is a basic difference between the digitalization of the existing business model versus a digital transformation towards a new business model.
The process automation, digitalization and operating model change can often be done locally by the IT department of your business
On the other hand, a business model transformation cuts across divisions and business functions.
Starbucks made a major shift when they went from selling coffee beans and espresso machines in their store in 1971 to a coffeehouse that brewed and sold their own coffee in the mid-80s.
Microsoft transformed from the Windows-grounded software product firm into a cloud platform company.
In conclusion, we can say that flexibility in a business strategy and knowing when you should change your business model can be crucial in both surviving and thriving in the current market.
Build resilience and sustainability
Before the pandemic, the primary goal of almost all businesses was—efficiency in its various forms: cost-cutting, lean, profit maximization, growth, and so on. Only a few organizations thought about resilience and sustainability.
This made them efficient sure but also made them fragile and vulnerable against disruptions.
With crisis being one of the most important drivers of change, I can’t think of a better time to start replacing efficiency with resilience and sustainability as primary goals for your business.
So what do I mean by building resilience for your business?
According to new research released by McKinsey & Company, digital networking is now twice as effective as traditional sales.
Smart business owners have adapted by moving sales online and encouraging virtual interactions. They embraced the remote working strategy for their employees to avoid glitches in productivity.
So, Resilience means optimizing future-proof channels and embracing eCommerce, digital marketing, online sales, virtual meetings and remote working.
And building sustainability by moving with the times, preparing for the unknown and adopting a hybrid approach to the business.
Like I said, it’s in the renewal phase that top leaders take the opportunity to reset or rebuild their business models and operations for a new reality.
Rebranding the company
The reason small businesses suffered more than larger ones during the pandemic is due to the fact that they have fewer resources, lack of innovation, slow technology adoption and a smaller network of customers.
Therefore, one strategy for keeping up with the big businesses is Rebranding.
Reasons Why Customers Buy Any Product or Service
Rebranding as a way of changing company image or offering new products or services that match the new trends is a great way for businesses to distinguish themselves from the competition.
Several businesses have been forced to rebrand after losing customer trust and satisfaction around health and safety, while others have been forced to rebrand as their products and services become less viable after the pandemic.
A report says that more than 70% of the people have changed brands during the pandemic.
And there are three reasons for them to switch to a different brand: value, availability, and convenience.
Customers now prefer a brand with transparency and authenticity.
So this is a great time to rebrand and reprioritize your goals and missions as a business, and more importantly, communicate them with your customers.
And think how you can diversify, whether that means shifting your product offerings or looking at new markets by understanding your customers need.
No matter where you stand, rebranding during a pandemic can help you to take advantage of valuable opportunities in a shifting marketplace. It helps to change customers’ perceptions of the brand and encourages them to engage with it.
To conclude I just want to say:
The only way small businesses can survive this pandemic is by reimagining their financial, business, digital, customer, and branding strategies.
Times have changed, there’s a major disruption in the way we do things like marketing, building customer relationships, conduct business operations, and financial management.
To successfully run a business in a post-COVID world relies on the business’s ability to continue to adapt and consider its customers’ needs in new creative ways.
That’s all for now!
I hope you like this one.
Thanks for listening.
Talk to you soon.
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