The word of the week is Opportunity.
Mark my words, my fellow small business owners, we are in the land of opportunity right now. There (hopefully) won’t ever be another pandemic situation quite like this one. It shook things up, turned things upside down, and made us all question our day-to-day routines, if not our sanity.
But for us, the small businesses, this is our chance to embrace change, to pivot, to future proof our business, to plan for a post-pandemic future where we grow more than we have in the past.
This is where David can beat Goliath, where the little fish finally swims in the big pond, where the small but mighty shine.
This is the moment when our little speed boat can turn on a dime, while the giant ships are just beginning to alter their course.
Don’t miss your chance by continuing on a straight-line path, thinking that all will go back to normal.
Enough idioms for you yet? Let’s get to the meat of things (Ha! One more – couldn’t help myself).
Pre-Pandemic to Today
Let’s all think back to the good old days, where your biggest problem was finding the help you needed in an economy with an unemployment rate of 3.8%, the lowest on record post World War II according to Pew Research.
We were all focused on where to find reliable help, pleased with our Just-in-Time inventory systems, showing up to work every day, even celebrating birthdays by eating cake together after someone blew out the candles on the very same cake we were about to eat!
Top issues being discussed by small businesses, aside from recruiting, included cybersecurity concerns, the need to update technology in general for enhanced automation, and a growing focus on firms being purpose-driven rather than just profit-focused.
Can you picture this pre-pandemic world? What did your projections for 2020 revenue look like in 1Q 2020? Pretty optimistic perhaps? Maybe a little wary of potential change in taxes or regulations if we changed U.S. Presidents in November? What were your top issues?
The Great Disrupter
As the incidence of COVID cases and deaths began to increase in early 2020 though, our working world changed.
According to the National Federation of Independent Businesses, from just March 10 to March 20, the percentage of small businesses negatively impacted by COVID went from 23% to 76%. And the percentage of small business owners very concerned about COVID impacting their business went from 16% to 68%. Suddenly cybersecurity and employee recruitment issues were much lower on the list of concerns as revenues dropped dramatically for most businesses.
Now let’s get more personal. How would you answer these two important questions about your business?
- What changed for your business, your suppliers, and your customers in the past year?
- What do you think will stay changed? What will revert back?
According to surveys and my own experience working with small businesses across the country, the top concern among small business owners was access to PPP (Paycheck Protection Program) and other government funds to aid in cash flow – or even to keep businesses from having to shut down permanently. The PPP “saved up to 55 million jobs, including up to 4.5 million in manufacturing, with an average firm size of just 20 employees,” according to the Senate Small Business & Entrepreneurship Committee.
Beyond cash flow, funding and forced shutdowns, other issues jumped up on the list of small business concerns. Among them:
Supply Chains: Just-In-Time Inventory processes helped keep manufacturing lines running smoothly, up until it didn’t. According to a recent Forbes article, ninety-four percent of Fortune 1000 companies saw supply chain challenges, and only ten percent of supply chains felt prepared to handle the disruption that occurred due to COVID.
Sales & Marketing: Many small businesses relied on trade shows and local networking events to connect with potential new customers and suppliers. When the world shut down, these events were cancelled. According to one survey, eighty-five percent of B2B tech marketing firms were forced to explore new lead generation paths during COVID. The most popular options included webinars, SEO and email, according to another survey of B2B marketers.
Digitization: As businesses worked to keep employees safe and to keep sales going, they’ve been forced (or inspired?) to adopt new technology options faster than they might have without the pandemic. This included many small retail stores and restaurants adding the ability to take orders online, something many of them will continue into the future. As a matter of fact, over eighty percent of SMBs reported “changing their business to incorporate new digital tools and strategies due to COVID” according to a Connected Council survey.
Your Post-Pandemic Future
Now that we’ve looked back at our pre-pandemic days and how each of us as small business owners have navigated the COVID waters, let’s consider what the future might look like for us. Here is where we get back to our word of the week.
Where is the opportunity for your business in light of the new world we are living and working in today? Bear in mind that if you are not looking for and taking advantage of the opportunities that have been created during this disruptive time, then those opportunities will likely turn into threats as other businesses seize on the potential for growth.
Let’s start the process by looking back at the questions in red from above. Can you take some educated guesses about what changes might stick and what might fade away? Consider the following:
- Have you made changes to the way you reach out to customers?
- What about the types of customers you are marketing to?
- Have your supplier or distributor relationships been affected?
- What have your competitors been doing this past year?
- How are your employees doing? And how have their lives and their jobs changed?
- Have you introduced any new technology to aid in business operations or sales?
Where is the Opportunity again?
When many businesses have been focused on survival mode, it can be hard for us to see a path forward beyond the next day, the next month, the next quarter. However, this is precisely the time to focus your efforts on the future. Where there is disruption there is opportunity.
It could be a simple as the fact that with all sorts of supply chain issues going on, and with some businesses going under, some businesses merging, and some seeing high demand that is expected to decline as the economy opens up, there is a lot going on. And that means that many businesses are going to be more open to finding new vendors, trying new products, adding new services and so forth.
Consider that when things are going great, businesses are reluctant to make changes. Why change what’s working?
But if things are still in a state of flux, then those same businesses might be more open to change – and your business could be the change they are looking for.
So, start with your existing customers – is there an opportunity to sell more or different products or services to them? Are you meeting your customers’ needs so they don’t decide to try someone new in your place? Is there an opportunity to add new customers who are currently using a competitor of yours or solving the problem you address in a different way?
Also consider your sales and marketing paths – perhaps you will be more effective at outreach through webinars if your usual trade shows are still virtual. Or maybe you should offer products or services online that normally are only offered in person. Be open to new customer types, modified products or services, and new tools for reaching out.
Future Proofing Your Business
Beyond connecting with your customers and exploring new marketing methods, consider the following:
- Are customers connecting with businesses in new ways?
- Nearly sixty percent of tech marketers have seen webinars grow in importance in the B2B technology world.
- Podcasts and videos are also new avenues for reaching engineers as customers.
- As more people got accustomed to take-out orders from restaurants, these new options are likely to stick around even though restaurants are seeing increases in in-person customers now.
- The latest trend in retail sales is BOPIS: Buy Online, Pickup in Store. As of last summer, about two-thirds of shoppers had used this service and 90 percent of stores planned to offer this option during 2021. This trend is expected to continue as well.
- Will manufacturers or retailers make any changes to their supply chain?
- Some experts are predicting a change from Just-In-Time inventory to Just-In-Case inventory, or perhaps a “single vendor/single country plus one strategy to manage risk”.
- Technology is expected to help address supply chain issues as well, with IIoT (Industrial Internet of Things)-enabled networks managing maintenance before a breakdown, and ERP and MRP systems helping to automate the decision-making process.
- How much time do you devote to strategic shifts?
- Some businesses that thrived during the pandemic were just the right business at the right time, such as Door Dash or Zoom. But others seized on opportunities to offer new services, like credit card provider Square, that offered a curbside pickup and delivery service for its small retail customers.
- The Local Store, a small retail store focusing on products made locally in my community of Eau Claire, WI, began offering Care Packages by category (games, food, self-care) for locals to order for friends and family. By selling by category and price rather than specific items, they were able to select items for each box based on their current inventory to keep selling and not be as dependent on high-demand, low-supply items.
Overall, nearly three-quarters of businesses surveyed by McKinsey believe that the COVID-19 crisis is one of the biggest opportunities for growth. And over half of these business owners considered innovation to be their top priority as we move to the end of this health crisis time period.
What opportunities are you finding amongst all of the disruption? Are you ready to grow your business? Take some time to give this some thought. And if you’re struggling to find opportunities in the disruption, consider the following quote from Clayton Christensen, the authority on disruptive innovation: