Survival strategies for entrepreneurs during and beyond COVID-19
As the Covid-19 pandemic triggers a wave economic paralysis around the globe, businesses are gasping desperately for survivial strategies. The question on the mind of every entrepreneur is, “how do I survive this crisis”? Even as some lay-off staff in a bid to reduce payment obligations, the reality, however, is that lay-offs do not guarantee business sustainability, rather smart transitions to solving problems or meeting current needs, will.
Changing circumstance bring new opportunities and new threats, and so entrepreneurs need to first understand where they stand in terms of their current offerings during this crisis. Are you in a position of opportunity, like those in agriculture, telecommunications and the medical supplies businesses that are currently experiencing a stratospheric increase in demand? Or are you experiencing a threat, like those in the airline, hotel and tourism-related businesses? If your business existence is threatended, this is the time to reflect on new ways to ensure you survive and grow. It should be understood that a new-normal has set in, and therefore to remain relevant, one must meet the new needs or problems arising from the pandemic.
Examples abound: In Kenya, passenger planes have transited to functioning as cargo planes; some hotels are now being used to shelter medical personnel to prevent them from going home daily and reduce the chances of infecting their families; many fast-food outlets have built drive-throughs, to serve customers in a safe way, and also take orders for home deliveries; fashion designers have transited from making outing clothes, which are currently barely in demand, to producing face-masks, some branded with company logos, medical scrubs and uniforms for paramedics; schools have transited to delivering classes/courses online; and the only indigenous car manufacturing company we have in Nigeria, Innoson Motors, is now producing more ambulances than any other type of car, as this is now what is most needed.
Realising and adapting to the new normal gives room for lots of innovations. We are beginning to see local innovations like solar or foot-controlled hand-washing devices that release soap, water and sanitisers, using solar power or pedals, disinfecting-spray doors and mobile hand-washing sinks. More innovations around hygiene are likely to keep springing up.
Sometimes however, simply going digital is sufficient to keep a business going in these COVID times. Many restaurants, supermarkets and florists have strengthened their online presence, advertising their offerings on Instagram and/or websites and subsequently delivering customer orders. Other times, businesses might need to pivot either temporarily or permanently, to something entirely different, by discovering new opportunities in another industry. For instance, cinema owners may need to think of doing something completely different for the time being, as they cannot open now, given that the traditional conditions of a cinema theatre do not allow for sufficient social-distancing, or ventilation, even if face masks are worn. A good example is what Coscharis, one of the foremost luxury car dealers in Nigeria, is doing. Even though his company’s main business is the sale of luxury cars and spare parts, given the demand slump for cars, they have turned their focus to agriculture, where they had invested in setting up a rice farm. The huge demand and profit from the rice business has made up for the decreased demand for cars.
One may be tempted to think, “but I don’t have a farm”. Fortunately you do not need one. The agribusiness value chain consisits of different aspects that can be keyed into. They include land clearing, farming, processing, packaging, warehousing, distribution, wholesale and retail. Depending on what you already do, you can decide to take up any of the aspects of the value chain where you can leverage your existing resources, or one that does not require a huge capital outlay. For instance, one can decide to dry perishables like tomatoes and pepper, which are always in demand and package nicely for sale without suffering losses from spoilage. What’s more, they can be sold for a higher price when out of season. “Real Fruit” is an example of a company that has made a thriving business out of selling packaged dried fruits such as mango, pineapple, bananas etc, as a healthy snack. The point being emphasised here is the possibility of pivoting to a different industry where you can meet a need or solve a problem.
As the saying goes, “change is the only thing constant in life”. Only those who can key into the opportunities emanating from the new COVID economy will survive. The smartest way for entrepreneurs to survive and thrive in whatever circumstances they find themselves, is to apply the rule of thumb question, “What problem can I solve in the present circumstances?” Once you have an appropriate solution to a problem, you have a ready market.
Dr Henrietta Onwuegbuzie, Academic Director, Owner-Manager Programme, Lagos Business School, Senior Lecturer, Entrepreneurship
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