COVID-19 is having a significant impact on many businesses across Australia. However, affected SMEs using these unprecedented times to diversify or fix ongoing problems will be better placed longer-term, says Simon Winter, Principal of Raine & Horne Business Sales.
However Simon warns, “Some industries reliant on discretionary spending, such as gyms, may take time to recover.”
“The silver lining is that at some point, this will end,” he continues, “Then there will be an explosion in the extraordinary pent up demand from people who haven’t been for coffee for months, haven’t been out for dinner, caught a movie or watched football.
“These people will break loose and will create an explosion in demand for restaurants, cafes, catering businesses and pubs.”
Childcare centres, aged-care services, liquor outlets, bakeries and garden centres are among the business that appear to have been cushioned from the worst of the pandemic’s economic fallout. “You can’t kick older people out of retirement homes while demand for garden products seems to have exploded with more Australians working from home.”
Also, businesses that take the time to diversify will be in a healthier place once the pandemic is over. “We are in a period now where we are seeing the clever businesses looking at ways to diversify,” says Simon. “It might be a liquor shop that has invested in a home delivery service.
“Alternatively, you might be running a restaurant and rather than paying UberEATS or Deliveroo, wait staff are redeployed to convey your vindaloos, fried rice or steak dinners to your hungry, isolated customers.”
Whether you are operating a café, motel or advertising agency, business hibernation gives SME owners the breathing space to focus on their weaknesses and opportunities, Simon recommends. “In these times, weaknesses become more visible, and this hibernation period is an opportunity to make changes and come back stronger.
“Normally, in the day-to-day operations, owners will not have the opportunity to make some smart operational hacks. If you intend being successful post-COVID-19, owners need to plan for the time when the social distancing measures lift, and they can re-enter the market.”