Small businesses are doing their best to simply weather the storm. Some are unable to avoid closing their doors as customers stop purchasing goods and services. Other due to government regulation. Yet, this does not mean the end. Some businesses are pivoting during these times. This is not the first time businesses have thrived under crisis. In the face of global war, economic recession, and terrorism, businesses have not only survived but also thrived. What factors allowed certain businesses to thrive during these uncertain times while others struggled? When the environment changes, there is one thing that determines a species survival: adaptation.
The restaurant industry is one of the hardest hit during this crisis. According to local San Angelo businesses, restaurants are doing 5% of their regular expected business. This means if a business expects to yield $1,000 per day, they now are only bringing in $50.
However, businesses that have a delivery-based model are pivoting quite well and are even seeing an increase. The pizza delivery business has seen a surge in hiring because of this crisis. While people are encouraged to stay home, they are also in need of food. Pizza has long been the go-to for home delivery. They were perfectly positioned to respond to the new demand.
In addition, this is where adaptation comes into play. Now in an economy that prizes delivery above dine-in eating, businesses are adapting to this demand. Those who do not have drivers are now either hiring drivers or allowing curbside pickup. The key to pivoting as a restaurant requires examining the present economic environment and determining how to increase production efficiency and online transactions. In the case of restaurants adapting to their new economic environment, they must present the same desirable feature of pizza delivery: speed, quality, and service. Some restaurants will have to adopt this new model to match the demand for services as consumers begin to get more comfortable with doing business online.
The retail industry is also taking a huge hit. If it was not hard enough, competing with the likes of other large online retailers this did not make it any easier. For years, retail has slowly made a transition to being online, as consumers get more comfortable with buying items on the internet. Now that most consumers are at home many are logging on the first time to purchase items on eCommerce sites. For any retailer that already had well-executed eCommerce store sales have increased especially for essential items. How can retailers move online? There are several steps required for retailers to move toward selling online. The most important is investing in infrastructure such as secure internet connection, an up to date computer, choosing a marketplace to begin selling items both locally and nationally/internationally, detailing shipping parameters, and promoting products online through social media. It is crucial that businesses that choose to begin to do business online focus on creating a shopping experience. Creating a shopping experience entails taking 4-6 great product photos, communicating product quality, and telling describing the product in a way that resonates with the business’s preferred customers.
The way we do business will change after everyone goes back to a normal way of life. More people will have purchased products online, as a result, discovered new brands, and how to engage with those brands. Businesses that interact with consumers will need to adapt to how their customers are now becoming more comfortable purchasing products online.
“Business Tips” was written by Alejandro Castañon, Certified Business Advisor of Angelo State University’s Small Business Development Center. For more information on the topic of this article or the services of the ASU · SBDC, contact her at Alejandro.Castanon@angelo.edu.