Coronavirus: Small Business Winners & Losers
Small businesses are amongst the biggest impacted by the COVID-19 pandemic. As people across the globe are sheltering at home, small businesses are struggling to survive. Yet, some small businesses are thriving in this new realty. Below I review the winners, losers, and inbetweeners of the coronavirus outbreak.
When the needs of Americans change, they go shopping. Kids at home need toys, educational materials, and snacks. Adults have 40 extra hours each week to find what else their home has been missing. Seniors need a two-month supply of anything they normally would, or could ever, need. Add in retail closings and a general fear of going out, consumers that would normally shop local are now redirected online.
When you meet in the office, you need tables, chairs, and a whiteboard. When you meet during this work-from-home period, you need online scheduling, video conferencing, and cloud storage. This new WFH culture is fundamentally changing how teams work together. Business people are leaving their normal workstations and recognizing new opportunities in cloud services and automation.
Your favorite dine-in restaurants have already closed. Grocery stores are packed, have limited hours, and the fear of COVID-19 dissuades you from visiting the stores. Kids can no longer eat at school. With new challenges comes new opportunities. The winners here have been: Meal preparation, food delivery, food pick-up, and practically any food you can buy online.
If you are in the event business, it is highly likely that you have no business. At least not for the next three months. Events around the world have been shut down. Sponsors are asking for their money back, while venues are fighting to keep theirs. Businesses who run or service events, majority of whom are small businesses, have seen their revenues disappear.
Any business that relies on the brick-and-mortar business model will suffer significant losses until coronavirus limitations are lifted. While big brands span the retail market, most retail stores are still owned and operated by small business owners. This includes salons & spas, gift shops, automotive dealerships, education centers, and much more.
Hospitality & Tourism
Most companies in this space have high fixed costs and only hit profitability at high volume. Travel worldwide has been halted due to the travel restrictions set by the different countries. Volume is virtually zero. The question here will be: As the government will likely give support to airlines and hotel groups, will the same be extended to small businesses in the sector?
This industry is a mix-bag right now. Most medical practices in most of the country are still open and seeing patients, albeit fewer. Elective surgeries, which oftentimes are the most lucrative for doctors, are getting postponed. Healthcare practiced via telemedicine is seeing a surge. Medical supply companies and distributors are selling out of any coronavirus-related product they might still have.
As in all cases pertaining to finance, there are winners and losers. Finance professionals that service by-the-hour are sleepless as businesses & individuals rely on their expertise during these tumultuous times. Businesses will need loans once they reopen & rebuild post-coronavirus, it is unclear for now how much help the government will give.
As most businesses suffer, so do their suppliers, vendors, and partners. At our agency, client budgets on Google Ads and Facebook Advertising have been hit by nearly 30% already. You cannot promote in-store sales when the store is forced shut. However, our website design, web development, and ecommerce departments have seen an uptick as more businesses and consumers focus their attention online.
I run a marketing agency which means I am also a small business serving small businesses. We service hundreds of small businesses across the country. Despite my evenly distributed groupings above, the vast majority of small businesses are indeed hurting. It sucks. But, if there is any consolation at all, at least it sucks together. This pandemic has impacted everyone and in such, brought us all a little closer together.
There is hope. Countries that have been hit earlier are already seeing a return to normal activity. The federal government has promised generous financial support. Forward thinkers are investing now in SEO and web development, ready to return post-coronavirus better, stronger, and more agile than ever before.