So today, with everything that’s going on, what are small business owners doing to survive the economic impact of coronavirus?
Six months after the national COVID-19 lockdown 1.0 in March 2020, a Simply Business report has identified the real impact on small businesses in the UK. The surveys carried out for this report focussed on small business owners and how the pandemic has affected the self-employed. Key facts to come out of this are:
- A whopping 234,000 small businesses have already ceased trading
- 1 in five small business owners doubt they would survive another full lockdown
- 85% of small business owners are planning to stay self-employed
- 10% intend to start a new business
- 1 in five small business owners have adapted their business to include new technologies
The second point is a big concern now we are one week into lockdown 3, and many small business owners are expressing how tough they are finding it this time.
Can you just wing it, or do you need a solid business plan?
The economic impact of the pandemic has proved one thing is certain, you can’t make any long-term plans because we just don’t know what the latest government advice will be.
Having a short, medium and long-term plan is beneficial for some small business owners who like structure but the key element here is the ability to adapt quickly. If businesses want to stay afloat, they have to react promptly within new guidelines and restrictions constantly being put in place; the amount of time it would take to rework your plan could result in lost profit.
How can you stay in contact with your suppliers and clients, so you are visible?
Videoconferencing solution providers virtually transformed the way we meet overnight, making online meeting so much easier and accessible when working from home. This has opened up worldwide access not just UK-based, creating more opportunities to do business globally and saving time and money for most organisations. Zoom and MS Teams are the most popular in the UK, but to give you an example of the growth for Zoom, they reported over 300 million worldwide daily meetings in April 2020 compared to under 10 million before December 2019. (Source: Zoom, 2020)
We’ve talked about adapting, so how can you adapt your business so you can still trade?
Whilst 2020 has been very challenging for small businesses, and indeed it looks like the challenges will continue for sometime into 2021, there has been an abundance of creativity and resilience that you would never have imagined. I have been blown away by the creativity and flexibility of many of the small businesses in my local area. However, the level of adaptability is very much dependant on the business sector given the social distancing regulations and PPE requirements which has made it very difficult for some businesses to survive. Most product-based businesses usually already have an online presence so for them it’s about staying visible, providing great customer service and managing deliveries safely.
Most service-based small businesses would also be found online through their website which acts more as an information portal than a purchasing tool. Business sectors that have been affected the most are the health and wellness and hospitality businesses. We have interviewed a small business owner whose COVID-19 business experience is just one example of how important adapting quickly is to business survival:
Interview with Bishops Cave Owners – Bishops Stortford and St Albans, Hertfordshire (established 2015)
“The motivation for starting up was that my son and I wanted to start a business together and we had a shared interest in the items that we sell; I was into wine and my son was into craft beers and we both love cheese so we decided to do all three together; our decision was made on the golf course.
Everything was going so well before COVID-19, the business was going from strength to strength and we were doing a lot of parties. We were always fully booked.
The biggest impact of COVID-19 on our business now is we are down on covers because we’ve had to separate all the tables. So, that’s obviously something we’ve lost out on. One of the hardest things to do was keep chopping and changing things; one minute we’ve got a bar and the next minute we’ve got to change it into a shop, the we can’t open at all, so we have to do deliveries. One of the other bugbears is all the admin; all the furloughs, the payroll – it’s been an absolute nightmare. Everything just keeps changing all the time and that’s probably been the hardest thing; the Government keep constantly changing their minds on things that directly affect us.
It’s quite easy for us to adapt to keep trading because there’s only two of us that own the business and if we needed to make a decision, we’d just do it. We just react really quickly, like with our online delivery service we set up 2 days after we were shut down and on the 23rd of March we were up and running again in a different way. We can adapt really quickly.
Our biggest lesson learned is that before COVID-19 came in we were too concerned with getting numbers of people through the door. It made us look at the business from the outside instead of the inside. What it has shown us is that we don’t need the place packed all the time as we’ve done it on a two-sitting basis with half the staff and in theory we can make more profit and less turnover. So, the lesson to be learned is to step out and step away from the business and don’t be in it all the time. If you own a business, be the owner and not the worker; we’ve learnt quite a few lessons from that.
Our advice to any small business owner is adapt quickly. Don’t bury your head in the sand and diversify if you need to and do it quickly. Speed is of the essence and if you take a few weeks to make a decision you might have lost out on a month’s worth of profit. Because ours is a hybrid business; some of it’s retail, some of it’s dining in, and some of it’s deliveries so it does allow us to diversify ourselves quite easily. Our advice would be to always look at different avenues of revenue.”
As small business owners, challenging our thinking and asking ourselves difficult questions going forward will help us to pave a new path for the future and make us more aware of how to diversify our small businesses to trade successfully in any future lockdowns. There is no doubt that difficult choices will once again have to be made. Many have failed, but many more have succeeded with a little injection of creativity, conviction and ingenuity it’s up to us small business owners not to return to the pre-March 2020 norm, but to strive for a better normal full of adaptability, profitability and hope for a bright future.
If you’d like to explore ways to diversify and futureproof your business, book a 121 online coaching session with me and let’s start creating a solid business model that not even coronavirus can disrupt.