Doing Business After Covid-19

14 Dec, 2022

As we head into the 2022 Christmas break, and as different countries end their state of emergency and government support rolls back, businesses are now starting to consider where to from here. There is no doubt in my mind at all that doing business after Covid-19 will be very different to doing business before Covid-19. How will this look? As a business mentor, my role is to look forward, consider the possibilities and help my clients navigate that path.

THE NEW LANDSCAPE

In December 2019, if you had said to me, that we would accept stringent restrictions on our movement, I would have laughed and said that you’re crazy. Yet, nearly 3 years after the start of the pandemic, we find that many have accepted what would never have been acceptable business practices.

  1. In Australia and many other countries, unvaccinated people were banned from frequenting public venues. Business owners were turned into pseudo police, having to check their customers vaccination status or face huge fines from the law (at least, in Australia that was the rule).
  2. A “no jab, no job” mandate was introduced. Many lost their jobs. Businesses that were allowed to open could not get employees. Social distancing rules meant that many restaurants could only open with sometimes less than half the seating available for customers. Numbers for events were limited – which made it unviable for those events to operate.
  3. When the pandemic first broke, the Australian Prime Minister, Scott Morrison, recorded the highest approval rating for a national leader in more than a decade for the way he handled the pandemic. 3 years on – trust in politicians are at an all time low.  Why did that change in 3 short years? The rise of independent investigative journalists and new platforms with hitherto unseen information would have been a factor.
  4. The early disappearance of polarised politics as our government representatives (at least in Australia) work together and cooperate on a wide range of initiatives to manage the pandemic. Queen Elizabeth’s speech in UK early on in at the start of the pandemic evoked the darkest days of World War II and called for unity. She likened the lockdown to the sacrifices that families made during World War II when parents sent away their children for their own safety. This has also changed. Politics are now more polarised than ever before as politicians vote down party lines.
  5. I have seen a new “generation” of dinosaurs who have just discovered how to use online tools like Skype, Zoom, Microsoft Teams, etc. Those who have resisted getting online no longer had a choice. They had to get online if they want to remain connected. This has suddenly introduced thousands and thousands of new users who have probably never done an online webinar before. The market is exploding. There will be no looking back on this one.
  6. There has been a return to family. Prior to Covid-19, “kids” were leaving home at the first opportunity. They wanted adventure and that often meant that they left home and travelled the world, making a new home for themselves in all four corners of the world. Covid-19 saw many returning “home” to be with family. Family has become important again. Citizenship also mattered as various governments called their citizens home with “mercy” flights bringing those stranded abroad back home.
  7. Consumers have discovered how reliant we are on our global partners. Delays in supply and less than full supermarket shelves blamed supply chain problems – resulting in rationing of goods such as flour, toilet rolls, paper products, etc. Those living in Perth, WA (one of the most isolated cities in the world), used to joke that WA stands for “Wait Awhile” … That is no longer a joke. It’s reality!
  8. The use of cash all but disappeared with many businesses insisting that all payments be made by card only during the pandemic. TAP AND GO became the ONLY way to pay during the pandemic – and many businesses have stayed cashless.
  9. Some of the initiatives that were rushed through by the various governments to in a bid to stop the economy from crashing are welcomed. Many of these initiatives are now being rolled back – and those who got used to the handouts are now suffering. Have we creating a new mindset of “big brother will look after us”? Will this change back to the way it was when we’re doing business after Covid-19?

HABITS

When the pandemic started, it was supposedly a lock-down for 2 weeks to “halt the spread”. The 2 weeks turned into 3 years – that is more than enough time for a habit to be built. And habits, once formed, are difficult to change (at least, that’s my personal experience).

For example, try ordering one of those yummy cakes when you next stop at a café to buy your regular coffee fix. Change your regular order from just coffee to coffee AND cake for a week. I would take a bet that you’ll find it difficult to go back to just coffee after this. Bad habits form quickly. On the other hand, good habits are not as easy to form unless you are one of those highly disciplined people (which most of us are not). Just look at how busy the gym is in January each year. Then see how many are still there in February and March. Good habits take much longer!

In the last 3 years, many of our habits changed – not all for the better! As I understand it, it takes, on average 66 days to form a new habit. I won’t repeat the great article written by James Clear on How Long Does it Actually Take to Form a New Habit which goes into it in a lot more detail. It’s worth a read if you want to understand the psychology behind this. Certainly his book Atomic Habits is one of those must read books if you’re wanting to change your habits.

Those habits formed in the last 3 years are now truly a part of our “normal” life – doing business post Covid-19 will reflect this new “normal”.

100 YEARS SINCE 1918

History show us that a pandemic is nothing new.

The Centre for Disease Control and Prevention (CDC) published a powerpoint from their webinar on Are We Ready for the Next Pandemic in 2018. At the time of writing this article, that powerpoint is still up on their website. Covid-19 hit in early 2020 (although some would say it started late 2019 in China) and most countries were still totally unprepared.

In fact, when Covid-19 first surfaced, many discounted it as “just a flu”. There was no talk of how this would affect business (or anything else). However, this is not “just a flu”. According to the World Health Organisation, the speed of transmission is one big difference. The graph from WHO demonstrate this clearly. Covid-19 is different. How and where it originated from is not relevant to this article and therefore not discussed.  However it started, there is no doubt that Covid-19 will make it into our history books as one of those pandemics that shape the world. Doing business after Covid-19 will be different.

DOING BUSINESS AFTER COVID-19

Doing business after Covid-19 will be different. It doesn’t take Einstein to work this out. How different will this be? How do I think this will pan out? Let me get out my crystal ball. This is my personal beliefs. I could be wrong. In fact, I guarantee I will be wrong in some of it. The fact is that no one has a crystal ball. We are all operating in uncharted territories. Three years in and it remains unpredictable. There are still no guarantees as to what will happen. This is a changing world.

I’m not an economist. I’m not a politician. But I am an entrepreneur. Doing business is what I do. I can “see” what’s happening and I can “see” that business will be affected.  I plan on innovating my business to ensure that I get to the “other side” so I can continue to do business after Covid-19 and whatever else turns up.

Until something else comes along that makes me think otherwise, my plans (and the advice I give to my mentoring and coaching clients) take the following into account:

1. WORKING FROM HOME

I believe this will become the new normal, not the exception. Employees now expect an option to work from home – at least for some of the time. Why do I say that? Businesses will be trying to recover after life returns to normal (however you define normal). They will be looking to save on costs. Many employers will have discovered that their employees CAN work as easily from home and their productivity CAN be monitored.

Those tools are already being used by companies who outsource their work to the Philippines and India. If employees continue working from home, the business will not require the big premises they had before Covid-19. That is an instant saving that will go straight to the bottom line.

However, there will be employers who want to revert to the old way and insist on having all their employees in the office. Now, they will have to justify why employees HAVE to go into the office when Covid-19 has proven that you can work from home.

If that happens and you own commercial properties, will you have difficulty leasing your premises? Will this affect the value of your commercial properties? Will workers need to live as close to the city centre or will there be a move further out to the suburbs where property prices are lower when they no longer have to commute? Does that mean that the highly sought-after properties close to the city will no longer be as highly sought after? Will that result in a drop in value of those properties? Who knows! All I know is that we must be prepared for this. Doing business after Covid-19 will change.

2. OUTSOURCING

The awareness of our interconnectivity will likely see an increase in outsourcing. Covid-19 will have gotten us used to talk to our employees on Zoom, etc. It will have gotten us used to working remotely. Many businesses will have realised that the business continued to operate fine with remote workers. Meeting face to face will have proven to be unnecessary especially in certain industries such as bookkeeping, accounting and financial services.

Companies will be looking to cut costs. And what better way to cut costs than to go overseas to countries where the labour cost is much lower and potentially save up to two-thirds of your labour costs. The thinking will be that if you can connect remotely with your employees in your own country, why not overseas? Why not, indeed?

I’m currently walking my clients through the changes they will have to adapt to. It’s no good complaining about it. You have to adapt. And adapt FAST. In business, it is always FIRST to the post who wins. Speed is everything. Act now. Don’t wait for everyone else to change before you make your change. If you are an employee, what change should you be making now to prepare for the possible loss of work to outsourcing? The general agreed view is that you must upskill so that you can do the work that cannot be outsourced overseas. Doing business after Covid-19 will change.

3. EMERGENCE OF AI

This is definitely something that will affect ALL businesses. The ability of the current Ai is exciting and scary at the same time. Gab now has an image generating Ai aptly named Gabby. To cap that off, they also introduced Mel, an Ai movie generator. Deep fakes are so real it’s hard to tell. Take this completely Ai generated Joe Rogan interview with Steve Jobs – that scares me!

However, does being scared of what Ai can do mean that you ignore Ai? What does it mean for your business? My guess is this Ai will affect sites that currently offer stock images and stock video. Why would I pay for those if I can just tell Gabby or Mel to create whatever I want?  What skills will you need to “manage” the intrusion of Ai into your business? After Covid-19, this is probably the biggest business disruptor you will meet. So I will do an article on this in the not too distant future … Another topic for another day.

4. RESURGENCE IN MANUFACTURING

As the pandemic continued, there was much discussion about encouraging manufacturing industries in Australia (and no doubt, in all other countries) as supply chain issues continue to cause problems.  There is a realisation that we are dependent on China although many have not truly understood how much … Until Covid-19 came upon us.

In fact, China has ranked as the world’s biggest exporter of goods since 2009 – including being the world’s largest exporter of toilet paper accounting for 12% of the global market. The run on toilet paper in all countries will possibly have been caused by the fear that toilet paper will run out because of the lockdown in China. Have a look at all the products sitting in your home. How many of those have “MADE IN CHINA” labels?

Just ask Mr Google. What does China export. I’m sure there’s no surprises if I tell you the list includes machines (computers, broadcasting equipment, telephones), textiles (women’s sweaters, suits, etc), metals (steel bars, iron structures, etc) , chemical products (such as pesticides, fertilizers, antibiotics), transportation (vehicle parts, ships, motorcycles, etc) and plastics and rubbers (plastic housewares, rubber tyres, etc). The last figure I saw stated that China exports make up 7.46% of total world exports. Look at the range of products and answer the question – Can you manage if China didn’t exist?

In Australia, the government stepped in with incentives for manufacturing businesses to make sure the shortages we see never happen again. The Modern Manufacturing Initiative will invest $1.3 billion in large transformative projects – although I’m not sure that is enough. It’s to encourage private investment and build the scale, connections and capabilities of local manufacturers, allowing them to shift up the value chain and grow. You may want to consider whether you are in the position to take advantage of this.  I know one thing – doing business after Covid-19 will change.

5.WILL PRICE MATTER?

It is likely that many will be surfacing from the pandemic with more debt to pay off than before Covid-19.  In Australia, people have jumped at the opportunity to travel again as we are released from our “prison colony”. (The Australian borders locked down and did not re-open until February 2021 and residents had to apply for permits to be able to leave.) Therefore, expect a shift in the spending pattern. The home renovations that thrived during the covid lockdown will likely not be as busy. 3 years of “jail” will likely also mean that people will be looking for value for their spend so that they can “catch-up” on their spending.

Does this mean that people will not pay the higher price for quality? I don’t have the answer to that. We will have to wait and see. Necessity will dictate their choice. Your customers might not have a choice. Some of the high fee chargers particularly in the professional services area might have to reconsider their charge rates after Covid-19. I would suggest that we prepare for the worst but expect the best. Doing business after Covid-19 will be different.

6. INFLATION AND THE ECONOMY

At the same time, inflation is taking off. If you understand economics, you would know that the printing of money by governments during the pandemic was going to cause inflation as soon as the artificial controls were removed. Today, rents are going through the roof in some countries. Many are falling behind on their mortgage payments as they struggle to put food on the table. More than 40% of small business owners can’t pay rent. I have been in business for over 40 years – this is the first time I’ve seen figures this high!

The big corporations such as Amazon and Facebook are having to retrench workers as the economic slowdown bites. Many builders are having to declare bankruptcy. No one is immune.

It may be time that you consider whether you actually NEED those office premises? Can you move to cheaper alternatives? Or if you’re in the services industry, can you move your office to your home? The amount paid in rent would pay for A LOT of coffees in cafes! Debt-free is looking like a good option right now.

7. ONLINE IS HERE TO STAY

The dinosaurs who insist that the ONLY course worth doing are the face to face workshops have now been dragged kicking and screaming into the technology age. Many insist that networking can only be done face to face. Many have stubbornly refused to learn how to use online tools because they “don’t need it”.  Suddenly, they don’t have a choice.

And many have discovered that online is not as bad as they thought it would be. Who would have thought that it would be possible to do church online and still be in a community? My church, Kingdomcity, transitioned our weekly church services to church anywhere anytime online and still maintain its community. It does have its advantages – now I can attend church in my PJs J. Who would have thought that it’s possible to do group worship while practising social distancing? Worship leaders have gotten innovative.

And that is what we MUST do in business. Get innovative. How can we take our current business online? Before you say, “I can’t”, or “It’s not possible”, you must ask, “How can I …”.

The market for online training is exploding. There is now a whole new potential global market of people who never used to go online but now accept that meeting and networking online is OK and normal. You have a whole new group of people who’s just discovered webinars. More to the point, they will also now be accustomed to searching for online material. How can YOU reinvent your business and take it online?  Doing business after Covid-19 will change.

Having said all that, there is also a push to “go local” and build your local community as people finally understood how important community is.

8. FAMILIES ARE IMPORTANT

I have not witnessed this type of return to family and to the home country for a very long time. The Chinese have traditionally done this during Chinese New Year – and that tie to family has always been strong. The western culture have a similar tradition over Christmas or Thanksgiving, but not to the same extent. Except now.

Will this see a popularity of products and services that cater to this? What are families who are looking to reconnect looking for? Perhaps a course on how to write your life story will be sought after? It gives the older generation the tools they need to help them leave their legacy behind. Will this mean that the take up on life insurance will increase? I don’t have the answer to that. The landscape is continuing to change. Think outside the box. Doing business after Covid-19 will change as priorities change for people.

9. CASH INDUSTRIES

For years governments have tried to stop the cash industry without much success. They introduced a consumption tax to try to catch the tax as people spend. They brought in spending limits for cash transactions. Covid-19 changed people’s habits where governments couldn’t.

I’m sure the big businesses probably prefer it this way. Less cash to count and less chances of theft by staff. Those who continue to offer a discount for cash may, at some future date, find that cash will stop being legal tender. Some businesses now have a “no cash” policy even though the pandemic is over.  How will that impact your business? The convenience of “tap and go” does mean that you should budget to pay more merchant fees as the banks take their cut from each transaction.

However, many communities are pushing back and encouraging the return of cash as the various governments push the introduction of CBDC (Central Bank Digital Currency) with campaigns to “keep cash alive”. We will see. Doing business after Covid-19 will change. And it will also change if CBDCs are introduced. (I will discuss how the introduction of CBDC will affect business in another article later – it is a huge topic on its own!)

10. RE-INVENT YOUR BUSINESS

No business can afford to stay still. The environment will change, and so must the business. One of the first to feel the effect of Covid-19 were travel agents and caterers.  When the pandemic started, I owned a catering business that specialised in grazing tables for weddings and corporates. The Long Table Perth had built its reputation to being one of the Top 10 Grazing Tables in Perth. Our event catering income reduced to ZERO overnight as events got cancelled. Did Covid-19 affect my business? Yes, it did.

We have had to change. Overnight, we started work on transitioning our grazing table to incorporate catering for corporate meetings and training. We still serve the same delicious petite canapes that we built our reputation on. We’ve added several other new items to our menu. By the time we re-started our business after lock-downs were lifted, we looked very different to the way we did before we went entered the pandemic.  We adapted.

PRIORITIES AND VALUES

There’s one other major change that’s taken place. People have now realised who are the real essential workers, the unsung heroes of Covid-19. It’s not the CEOs of major corporations, it’s not the famous sports personality or movie star. And it’s also not your highly paid professionals.

Sports centres closed. Restaurants were limited to only takeaways. Public parks were closed. Big sporting events were cancelled. It’s your teachers, childcare workers, checkout shop assistants, nurses, doctors and truck drivers, etc that are being asked to keep working to keep the wheels turning when a country is placed into hibernation. There is now a huge shortage of construction workers, child care workers, hospitality workers, nurses, tradies, etc. In some industries, it has resulted in wages increases that has been passed on to customers in higher prices – which in turn fuels the inflation.

Will that change the way we do business after Covid-19. Yes, it will. We have to take all of the above into account.  The only answer I have is that we must be prepared to go with the flow and ride the waves whichever way they fall.

So here’s to innovation and change – here’s to a new way of doing business after Covid-19 – however that may look like.