“Pivot,” is a word that has joined the lexicon of phrases linked to the coronavirus crisis. Small businesses are being told to pivot their businesses to meet the needs of the new economy — and to simply stay alive. Of course that’s often easier said than done, but those that succeed may find their businesses permanently transformed for the better. Here are lessons from four entrepreneurs who are navigating the new normal.
Think Like a Startup
“Everyone is a startup,” writes Julia Pimsleur, small business coach and founder of Million Dollar Women in a blog post about how to transition your business. She suggests business owners “reframe” their thinking, explaining, “you can think of your business as a shell of what it once was, or you can think of it as a cool new startup.”
That’s what Sam and Joe Eitzen co-founders of photo booth rental startup The SnapBar were forced to do. According to a profile in Inc., Sam stayed up until the wee hours brainstorming ideas to keep their business alive as photo booth rentals and the demand for selfie stations fell off a cliff. Among his ideas was one the leadership team chose to implement. The company quickly shifted to making gift boxes featuring goods from local businesses under the name “Keep Your City Smiling.” Sales are brisk and expanding to new markets. According to Sam, the new products are likely to become a permanent offering.
Be Willing To Be Surprised
Mark Evans runs SummerCampHub.com, a small consulting company for summer camps which he helps with marketing, growth and camper retention. “Needless to say, since summer camps are a collection of tens and hundreds of people at the same place, the industry is not in a good place right now,” he says.
But he’s not about to throw in the towel. And apparently neither are his clients. While his work has traditionally meant traveling from camp to camp, meeting in person, he has shifted to video conference consulting. “With camps from all over the U.S reaching out to me this has actually led to an increase in business and worked well for me,” he explains. That has allowed him to work with more camps and to save money on travel costs. “This has been an eye-opening experience and I plan on making this a permanent thing even after this pandemic ends,” he says.
Promote a Remote Culture
Dynamite Jobs runs a remote job board and has “seen things been almost flipped upside down,” according to General Manager Alexander Harling. “The number of new jobs coming in decreased by 50% but the number of candidates coming increased by 50%,” he says. So the site has shifted from hiring services to selling remote job-seeking services.
“Since we have so many new candidates, we’ve added new services to help them including resume services as well as sharing more job search resources to help them during this difficult time,” Harling explains.
The company is also doing extensive outreach to set up partnerships, offering a first job listing for free. They also run events and have moved all the events online.
Harling says that although many jobs have become work from home after COVID-19 hit, many “do not have a strong remote culture or good methods of tracking employees beyond watching them at their desks. Remote culture doesn’t need an office. Managers aren’t watching employees, but instead watching results.” He believes that companies that adopt a remote culture are the ones that will thrive.
Go Where the Market Is
Like many entrepreneurs, Talibah Bayles, founder and CEO of TMB Tax & Financial Services, LLC and The Mompreneur CFO Academy, initially found herself in “utter shock,” by how quickly the economy changed. But as someone who assists small business clients, she knew she needed to adapt quickly, not only to help her business survive, but to make sure her clients’ businesses survived as well.
Almost immediately, began assisting clients with loan packaging and submissions, specifically assisting those that still need to file taxes or need bookkeeping completed for financial documents as well as helping them find PPP lenders. She also helps clients establish QuickBooks accounts and assists them in setting up solid accounting and financial management systems.
She has also established a new line of income that will serve her long after the crisis is over. “I just recently became an Authorized QuickBooks Solutions Provider,” she notes, “which is a fancy way of saying that I can resell all of Intuit/QuickBooks products and supplies. I’m very excited about having this capability in my line of work!”
How to Be In the 9%
In the research report, Roaring Out of Recession, published in the Harvard Business Review, researchers Ranjay Gulati, Nitin Nohri and Franz Wohlgezogen shared their research involving 4,700 public companies and how they navigated the last major recession. They found that three years later:
- 17% did not survive,
- About 80% had not yet regained their pre-recession growth rates for sales and profits, and
- Just 9% “flourished after a slowdown, doing better on key financial parameters than they had before it and outperforming rivals in their industry by at least 10% in terms of sales and profits growth.”
What did the successful survivors have in common? According to their research, “companies that master the delicate balance between cutting costs to survive today and investing to grow tomorrow do well after a recession.”
While the companies they studied were much larger than most small businesses, the lessons from their experiences may hold again in the current downturn. Reducing spending will be important to many small businesses in the immediate term, but finding smart ways to invest in growth — and yes, to pivot — will be crucial going forward.