We are aware of how the coronavirus pandemic has affected the labor market and is killing the middle class. However, here I want to talk about how it is also keeping entrepreneurs on their toes. They are as we speak planning for the ‘new normal’ with every update that comes their way.
To help reduce the spread, Apple shut down their stores. Many stores did. It means less income and eventually less profit. Now when Apple can pay its employees during these trying and temporary times, not all companies have the resources.
I recently came across a heart-touching note that Deepinder Goyal, Founder & CEO of Zomato, sent the employees of the Indian restaurant aggregator and food delivery startup. I couldn’t help but sympathize with his situation.
He had to lay off 13% of his employees in the wake of the COVID-19 situation. When you read that note you understand its layers. Zomato tried to put people first in its own way.
While he made sure he makes the transition as smooth as possible, it’s sad that the Zomato CEO had to do that in the first place. It is tough to let go of star employees. These are the people who made you reach the heights you are at now.
He had to do that.
That’s not the only way the pandemic has affected entrepreneurs though.
Ways That the Pandemic Has Affected Entrepreneurs
There is no one action plan that fits all
While businesses like video gaming, video conferencing, project management software, IT & marketing, online shopping, etc., will boom, it is not the same for the hotel, sport, entertainment, retail, or restaurant industries. There is no one action plan that fits all. The latter will now have to innovate. Some of them might take the opportunity towards digitalization to increase the touchpoints with their potential customers. But in any case, an estimate suggests businesses like these shall be ready to lose 50 to 80 percent of their turnover.
Ian Davis, one of the former managing directors at Mckinsey, amid the global financial crisis 11 years ago wrote, “For some organizations, near-term survival is the only agenda item. Others are peering through the fog of uncertainty, thinking about how to position themselves once the crisis has passed and things return to normal. The question is, ‘What will normal look like?’ While no one can say how long the crisis will last, what we find on the other side will not look like the normal of recent years.”
I cannot believe how it is as befitting to the present situation as it was 11 years back.
Online presence is not bringing the same business as before
At Ranking By SEO, we work with clients from different industries across the globe. From movers and packers to wedding planners, all kinds of industries have made their online presence a thing by now. However, I have noticed that the current events have generated lesser organic traffic for most of the businesses and even lesser conversions for some of them. The drops are noticeable.
Some of our clients were local vendors and thus did not have the budget to continue. However, they are still trying to thrive. Local restaurants and travel agencies are offering massive discounts. Movers and packers are trying to market their services for contactless, hygienic, and safe movement of their clients’ items. It’s only going to get tougher.
Real Estate Costs Are Only Piling Up
Except for healthcare and essential businesses, every country has imposed a lockdown on other social and commercial establishments. Regardless of whether you are a small business or a big one, real estate is a recurring expense outside of payroll.
Given the current situation, many businesses have to make full or partial work from home a permanent feature of their organizational management system. However, not all businesses can afford that. Their organizational management systems are simply not defined in a way for the entrepreneurs to take the business fully online. Yet again, it is another concern for entrepreneurs.
To quote the people at Mckinsey, “To get back to business, many companies are running spreadsheets to see how many people spaced six feet apart will fit in an office, planning one-way paths through the workplace, and figuring out adaptations to restrooms, lunchrooms, and entrances. All of those are critical tasks, but they are not enough. ”
Drop in the Employee Productivity
Besides the lockdown demanding shut down of establishments, many organizations expected their employees to operate as a remote workforce without productivity drop.
Now remote work is not as difficult as it is when it’s imposed upon you. Leaders, entrepreneurs, startup owners had to change and are still changing the ways they’re managing and leading their now remote teams. However, given the current situation, every organization has to go the extra mile.
It’s evident that given the current situation it’s inhuman to not empathize with people who work for you. People are not only anxious about what’s going to happen next, but they also fear their loved ones might get infected by the virus, especially the ones who are more vulnerable.
So, with a moral obligation to stay empathetic to employee needs, entrepreneurs, in addition to decreasing turnover, are also experiencing drops in employee productivity. Sure, there are tools to keep remote work as productive as possible, but there is no replacement for human touch. Many businesses can function remotely but do not have the necessary equipment to adopt digital platforms and maintain some sense of purpose in these trying times.
Finding the Silver Lining
What is the ‘new normal’? Even though entrepreneurs seem to have their act together, none of us can predict what the ‘new normal’ will be.
One thing I am sure about as a marketer myself is that traditional marketing is taking the backseat. It has probably taken the greatest hit amid this pandemic among all the forms of marketing. Google and social media ad spend will increase. There’s an opportunity for every business online, maybe not now, but after a while, there will be. Take the rise in the search for ‘cheap flights right now’ as a positive sign. People might not want to travel now, but they will want to in the future. Focus on a long-term strategy.
Another thing I am sure about is that entrepreneurs are resilient and optimistic. They are fighters. Entrepreneurs will end up creating more jobs, they will conquer this difficult period because they have it in their DNA to recover.
Keep planning and innovating.
I sincerely hope you can.