For businesses, 2020 has been like a crash course in dealing with unforeseen circumstances.
Since the onset of the Covid-19 pandemic, some were already troubled by dwindling revenues.
Not long after, the situation morphed even further as transmission numbers rose and many more lives were affected.
The ‘circuit breaker’ measures became necessary to clamp down on the spread of the virus — and in the blink of an eye, businesses were completely unable to operate at the same capacity as they did before.
The impact has been severe enough to warrant four support packages from the Government, amounting to a total of S$92.9 billion, of which a large part is dedicated to keeping businesses afloat.
Through this period, businesses have little choice but to adapt to new modes of survival in unfamiliar territory.
While it is a stressful time, the experience calls for founders and entrepreneurs to rethink how they will face future challenges. Here are some learning points we gathered from three Singapore business owners:
Going Digital Is A Priority
Singapore and the rest of the world was already on the path of digital transformation before this, but Covid-19 accelerated the urgency to take action.
Firms that already had digital capabilities and services could transition more smoothly to changes, while those that operated fully offline had to scramble to equip themselves, or be on the losing end.
The Fun Empire, a company that provides team building experiences, had to create new virtual activities in order to keep going.
We specially designed our virtual team building activities to include elements of communication and group problem-solving that is done over video-conferencing.Ryan Ho, Co-founder of The Fun Empire
Unable to offer their bread and butter of physical team activities, they quickly pushed out features like virtual escape rooms and virtual craft workshops.
Like The Fun Empire, many firms have needed to hop online as their emergency lifeline to survive the circuit breaker.
The biggest lesson in this is to start treating digital capabilities a part of the foundation, and not just a bonus.
Even for some traditional brick-and-mortar businesses that might not be ready to dive into the deep end, they will still have to adopt digital solutions in areas like payment, logistics and payroll management, at the very least.
Along with the ecommerce and food delivery boom, firms should note the rise of specific trends like livestreaming and virtual events, and tap on them to gain a competitive edge.
These new methods of reaching consumers will remain relevant even after the pandemic is over, as the changes in people’s behaviour is set to last.
Don’t Lean On Just One Revenue Stream
In the midst of these unexpected circumstances, the saying “Don’t put all your eggs in one basket” has proven to be true.
More than just having an online channel to cushion the loss of offline sales, it could also mean diversifying into multiple business units to have a wider safety net if the main one fails.
Goh Chee Cheng, founder of bubble tea brand Yuan Cha, learned this when the circuit breaker measures were tightened and all drinks-only stores were ordered to cease.
Even though Yuan Cha already had an online strategy with food delivery platforms, it couldn’t help them now.
When we [had to close], we started seeking ways to resume business by adding a new food menu, but this was rejected by Enterprise Singapore.
[Our only option was to] work with other food premises that can operate, and we have to pay them rent to use some of their space.Goh Chee Cheng, founder of Yuan Cha
While it is tempting to build on one strong suit and do it well, businesses should also safeguard themselves by having a few streams of revenue.
Not only will it provide relief in the event that one stream is suddenly cut off, but it can also help you build a larger pool with different types of customers.
Diversify Supply Chains
As Covid-19 sent countries all around the world into lockdown, supply chains were put under immense stress.
With workers under quarantine, many safety procedures to go through in the workplace, and some businesses closed altogether, the time it takes to move goods has been stretched out.
On top of that, having entire populations working from home also meant that demand for certain goods spiked beyond what was manageable.
For example, F&B businesses had to procure much more takeaway food packaging than they ever did before.
The Fun Empire also experienced difficulties as a few materials became hard to obtain during the circuit breaker, but they were lucky enough that it didn’t take long to find alternative suppliers locally.
“This gave us a good reminder to have a well diversified supply chain to cater to challenges such as those brought about by Covid-19,” said Ryan.
From the disruptions faced today, businesses should observe which areas of supply are potentially vulnerable, and build a more spread out network of suppliers in the future.
Be Prudent In Spending
Needless to say, a company’s financial health is the most pressing cause of concern in the midst of a crisis.
For some firms, their outlook has quickly gone from bringing in healthy profits on a usual basis, to suddenly having to worry if they can continue paying their employees.
Lyn Chan, co-founder of mobile tailor A Gentleman’s Tale, shared that her business has lost its revenue as it cannot provide any tailoring services under the current guidelines.
How we are sustaining our fixed expenses (rent, loan repayments, internet/phone bills and salaries) right now is by utilising the funds that we had put aside for our business expansion plans.Lyn Chan, co-founder of A Gentleman’s Tale
One of her greatest takeaways from this tough time is that it’s vital to “build a stronger war chest and constantly be prudent in [their] expenditure”.
Take Care Of Your Team
This pandemic has resulted in many unfortunate layoffs. But on the other hand, we’ve also heard of companies big and small that remain dedicated to protecting jobs and paying salaries.
It’s a good time to remember that it’s the people who make a strong business what it is.
Lyn has extended this mindset even to the seamstresses A Gentleman’s Tale commissions, and is helping them find alternative sources of income.
Since the announcement of circuit breaker, we have been producing reusable masks so that our seamstresses are able to continue having a source of income, we can continue supporting the mom-and-pop fabric shops, and that the community in Singapore would have access to affordable masks.Lyn Chan, co-founder of A Gentleman’s Tale
With new work form home arrangements and plenty of uncertainty going around, employers may have started to check in on workers regularly and understand their situations at home.
This period has also heightened the awareness that mental health is paramount for workers to stay happy and motivated.
Some employers are also supporting their workers to up-skill during the down time, to better position them for recovery when the time is right.
Beyond the pandemic, it would go a long way for business owners to continue adopting a similar compassion and foster stronger camaraderie among their teams.
Above Everything, Always Be Ready To Adapt
However, no matter what lessons you take from this crisis, the one thing to bear in mind is that the unexpected can happen any time.
“Change is the only thing that is constant. It sounds like a cliche, but we experienced it vividly during this period of time,” said Lyn.
Before Covid-19 became a threat to the economy and livelihoods, no one knew how important it was to have a contingency plan.
Above all, businesses should always be ready to adapt to challenges — whether it is by frequently testing their crisis management systems, or implementing flexible work arrangements as a new norm.
Even with the best of planning, there may still be scenarios that cannot be foreseen, and will require quick responses to be made on the spot.
The key takeaway from this COVID-19 pandemic is to always stay adaptable, nimble and innovate quickly to the changing landscape.Ryan Ho, co-founder of The Fun Empire
Featured Image Credit: Vodien