Is it time to change my business model?
I have seen many Facebook support groups for restaurant owners, business owners in general, and just about every SME that has founded a business the past decades or maybe even just a few months before COVID started, and all of us, myself included, have wondered how long ECQ and MECQ, and finally GCQ, will last.
I applaud those bold enough to open for services, like beauty salons, barber shops, and wellness centers, without fear that one infected client may cause the ultimate downfall of a business. It’s the only proof or test if our business will still survive the coming months. We just will find out sooner than later.
We were about to open a café in Cavite, right by our farm. All the equipment has been set in place, and tables and chairs delivered. Soon the maintenance guys would come to install the rest of the machines and we would be on our way to opening day. Or so we thought.
We know of friends who just opened their restaurants a year ago or just a few months ago and they now have to face accelerated depreciation of equipment and maybe even closure. A café across our store just advertised their equipment for sale. Another friend is selling two refrigerated vans at a discount.
So, we come to pinch ourselves to make sure that this is NOT just a bad dream. It is real and we have to face the music. It is real and we have to make tough decisions. To face the business squarely and check what our slim chances are of still making it. Of facing our suppliers and creditors to give us six months to a year to maybe liquidate or hopefully bounce back and be able to settle our bills.
Judging from the resilience I have been observing, here are some pivots and shifts which are proving to be useful and fairly successful.
COVID TREND No. 1 — Families cocooning at home
1. A bag designer has repurposed her fashion bags as home accent pieces.
2. A textile retailer repurposing fabrics for throw pillows instead of for clothes or bags.
3. An art gallery owner is selling art for people who are investing whilst staying home to enjoy the art pieces.
COVID TREND No. 2 — Families eating meals at home
1. Food suppliers selling pre-baked or pre-cooked food for reheating at home.
2. Food chains selling frozen versions of their top sellers.
3. Do It Yourself (DIY) kits of ramen and other dishes that don’t travel well.
4. Home delivery of groceries has become the norm.
COVID TREND No. 3 — Families having more time to learn something at home
1. Children can take language lessons.
2. Parents can take music lessons with their kids.
3. Art lessons and crafts are learned from YouTube and other internet sources.
What are these trends telling us?
Our business must morph or transform into a new model of itself. We just cannot insist on the same old model for our business. Every business is changing into a COVID VERSION of its mission and vision. An adaptable version is much needed.
Even banks have to do fintech or they die.
Even advertising agencies have to break up and serve smaller clients.
Even consulting companies now have to provide services fit for MSMEs.
Travel and tour companies have to regroup.
Events companies must now use virtual places.
So, every business must transform or die. It used to be “differentiate or die.” Now, it’s transform, innovate and use all the creative juices we have to change our business model.
And if we still insist on doing the usual, and keep harping on Pre-COVID and Post-COVID (if there is such a thing), we will keep stopping ourselves from thinking out of the box.
Think positive. Yes, think: What if every one of your clients tested positive?
Think positive. What if one of your staff suddenly is tested positive?
I am an optimist but also a realist. COVID-19 is here to stay and we have to roll with the punches. Either we change now or it will change us.
THINK POSITIVE. There is another business model waiting to be discovered and it’s for you.
This article reflects the personal opinion of the author and does not reflect the official stand of the Management Association of the Philippines or the MAP.
Chit U. Juan is a member of the MAP Inclusive Growth Committee and the President of the Philippine Coffee Board Inc.