Innovate to survive: don’t let lockdown restrictions beat your business
If businesses on the high street thought 2019 was a disaster – after the UK retail industry suffered its worst year on record – nothing could prepare them for what was around the corner. The rapid spread of Covid-19 has led to the implementation of unprecedented lockdown restrictions that have forced ‘non-essential’ retailers to shut their doors indefinitely – draconian measures that are likely to be felt in the back pocket of businesses long after they are lifted.
The economic symptoms of the pandemic are being felt far beyond the high street, with businesses across the land forced to rethink the way they operate – from rapidly adjusting to remote working to applying for and implementing government aid.
Pandemic plays to Amazon’s strengths
With the public under strict instructions to stay at home, online operations like Amazon have filled the void left by the high street – the last bastion of traditional shopping that was already on its knees prior to the pandemic. Shipments from the world’s largest online retailer have subsequently become a lifeline for many people who have turned to the delivery giant to keep them fed and entertained.
While many businesses have been hamstrung by the impact of the Covid-19 pandemic, Amazon customers have been spending almost $11,000 a second on its products and services, propelling its shares to a record high. To cope with this surge in demand from cooped up consumers, the e-commerce giant has been hiring tens of thousands of new employees. In contrast, companies across the world have been forced to make staff redundant or place them on government-funded furlough schemes, in a bid to survive the economic impact of the pandemic.
If Amazon is a clear winner from the Covid-19 crisis, what lessons can high street retailers and other businesses learn from their success? The company’s online model has positioned it as an indispensable and reliable utility during the pandemic. This has highlighted the need for all businesses to innovate rapidly to keep their revenue stream flowing during these uncertain times.
Innovate to survive
Rather than waiting for the all-clear for business to resume as usual – a risky strategy that might leave you without one come back to – now is the time to be proactive by adopting innovative ways of working. Companies should, therefore, assess how they can modify their business model and redefine their revenue streams, so they can continue operating in the current climate and beyond.
TDM Group (a leading Managed IT Service Provider) Director Tarek Meliti says: “businesses should always be prepared to innovate and re-invent themselves. Especially when major events occur that expedite this process, forcing them to rapidly address the changes thrust upon them to survive. If used effectively, technology could be a strong enabler in achieving this.”
For example, businesses that aren’t already generating revenue online should make themselves accessible during the lockdown period by digitalising their offering and selling through multiple online channels. Equally, training or consultancy businesses could circumnavigate the social restrictions by delivering their services remotely over the internet.
By embracing technology to empower your business functions and protect your revenue, you will instil the operational resilience needed to ride out the current crisis – and any similar scenarios in the future. And once the pandemic is finally over, you can continue benefitting from the convenience operating online brings.
You might even consider using Amazon to achieve this. After all, they can provide your business with instant access to a huge customer base – almost 90% of shoppers in the UK use the online marketplace and 40% have access to its Prime subscription service. However, sellers must pay high fees – such as shipping, referral and variable closing fees – to trade on Amazon, often denting their profits; all of which can add up to a substantial amount. For example, the referral fee for selling on Amazon is between 7% and 15% for most item categories. Unfortunately, sellers don’t always have sufficient margins in their products or services to cushion the blow from the high fees Amazon charge to access the world’s largest online marketplace.
Tarek highlights an alternative approach: “Consider using Shopify to build a bespoke online store from scratch at short notice. This e-commerce platform provides all the point of sale features you need to move online. And with time of the essence, you can also explore Fiverr – an online marketplace for freelance services – to find a reputable Shopify store builder to do it for you, so you can inject some life back into your business asap!”
Take Sea Island Coffee for example. This purveyor of high-quality coffees doesn’t just rely on its London-based store to sell its wares; it has also built and deployed a stylish online shop using Shopify. So, with their retail outlet out of action during the enforced lockdown period, they can continue doing business and engaging with their customer base.
Some forward-thinking businesses are also using their online presence to offer local delivery services during the lockdown period – making sure they adhere to strict social distancing rules in the process. Yorkshire-based brewery Samuel Smith has been doing just that: customers that place orders online receive their booze courtesy of the company’s very own horse-drawn cart. Not only does this help to keep business going; it’s a great way to boost morale during these challenging times.
Photograph: Samuel Smith’s / Facebook