This has been one of the most confounding times in modern history to be a business owner. Within a few weeks, many US industries went from vibrant to mostly shuttered. The government passed, on a voice vote, the largest stimulus bill in history – and predictably, pushing that much money out to the businesses that needed it has been chaotic. Some businesses let employees go before it even passed. Others can’t get the money from suspicious banks. A third group isn’t convinced it won’t become a loan by accident, and aren’t willing to risk taking it onto their books.
This short period of economic shutdown is immensely worse than a recession. It’s hard to predict how any industry will fare after being forced to slam on its brakes to a full stop, because that’s never happened before. With no functional office, no customers, and plenty of bills, many businesses have retreated into their turtle shells – minimizing expenses and waiting until something as simple as a business transaction is again possible. It’s hard to prepare for the future when there’s so little that can be safely predicted about the next quarter, year or decade.
If this defensive posture describes your business, it’s still not hopeless to prepare for the future. Here are three things you can predict.
You’ll need a ‘Book of Many Tabs’
Before Alex Azar was appointed to become our current Secretary of Health and Human Services, he was the General Counsel of that agency in the aftermath of the September 11th attack. At one point, he was called in to a Smallpox vaccination meeting, and given 24 hours to write a vaccine injury compensation plan for front-line responders to emergencies. After that harrowing experience, Azar assembled a “book of many tabs” which contained things that would need to be done for each type of emergency they’d face.
There are several potential outcomes to this crisis. Goldman Sachs is predicting the fastest economic recovery in history on a percentage basis. JPMorgan’s CEO is predicting a “bad recession”. And no matter how the macro-economy performs, businesses in different industries will have different experiences.
If you or your employees are prevented from doing the day-to-day work you are accustomed to doing, it’s a great time to consider the many potential realities your business may face once the economy begins to slowly reopen. Whatever happens, the businesses that adjust to it most quickly are likely to be more successful than those who have put together a previous plan and push forward to execute it without adjustment.
The economy stopped on a dime – but it won’t restart that way
Many businesses are anxiously awaiting the restarting of the economy. The odds are high, however, that next year we won’t be able to look back in history and point to the time when everything got moving again. In fact, some things are still not going to be fully operational a year from now.
The first day the stores open back up in Crabtree Valley Mall, don’t expect too many people to be there. Many will wait to see whether the infection curve will elevate before they get around too many people. Shopping isn’t as fun when you have to stay six feet away from your friends – and who wants to put a shirt on in the dressing room to see if it fits? Not anyone who’s worried about their health.
Movie theaters are likely to be mostly vacant for many months. Among the worst hit will be live entertainment events like Hurricanes games and the NC State Fair. If these types of events are even permitted, many avid fans will skip them for the first time in decades to protect themselves.
These types of businesses may not be your clients – but they might be your clients’ clients. And that’s how the effect of a partially shuttered economy will cascade through the marketplace even if you’re not in a directly-impacted industry.
It’s going to be a different world
One advantage a turtle has when retreating into its shell – in most cases, when the threat finally recedes enough for it to pop its head back out, things are mostly as they were before. That’s not going to be the case here.
While companies who budgeted conservatively may be able to weather this shutdown, many will not be able to. Furloughed employees may have found other jobs. Some businesses may have shut down entirely or filed for bankruptcy. Some industries may come out of this with far fewer players.
Your customer base may shrink. Your prospect base may even shrink. But there are likely to be many new opportunities that weren’t there before Coronavirus, whether due to changed behaviors, a less crowded competitive landscape, or an abundance of highly skilled but newly unemployed workers. Companies prepared to quickly adjust to the new risks and opportunities will thrive, even in a recession.
To learn how WingSwept can help your company make better use of technology to thrive during challenging times, call us at 919-460-7011 or email us at Team_WingSwept@WingSwept.com.