Facing the future: The route to business recovery

  • 15 Jun 2021

For many small businesses, the world may never return to how things were before the pandemic hit. But taking steps now to adjust to the new reality will give your business the best chance of success. Penelope Rance explains.

Many small firms are optimistic that this summer will see a return to business-as-almost-usual, but there is no denying the coronavirus pandemic will have a lasting impact. Small enterprises may have to reposition, streamline operations, change staffing models, upgrade technology or move into new sectors.

“The companies that have surpassed expectations are those that have been open to change from day one,” says Mathew Gillies, director at Cowan & Partners chartered accountants. “Taking change by the horns and capitalising on opportunities is the best way for a business to thrive post-pandemic.”

 

After a prolonged period of upheaval, one step on the road to recovery is a review of existing operations, ensuring your business is set up to face future challenges. Lessons learned could feed into increased efficiencies, a stronger workforce and more innovative thinking. 

“Develop a mindset of continuous improvement,” advises Anthony Impey, CEO of Be the Business. “Take a moment to reflect on changes you made or processes you implemented that enabled you to be adaptive, responsive and innovative in a time of crisis, and decide which actions can be mainstreamed into your business model.”

Consulting an outside expert could help you identify efficiencies. “If you find the right advisor and lean on them, it frees up time to plan, strategise and grow your business – all steps that will ensure a successful recovery from the effects of Covid-19,” says Mr Gillies. 

The hospitality industry was hard hit by lockdown, but the downtime was an opportunity to make improvements, says Andy Banner-Price, co-owner of The 25 boutique B&B in Torquay. “We’ve used our time effectively, with updates to the website, the breakfast room has had a complete makeover, and several rooms have been painted.” They kept customers engaged with newsletters and social media posts, and are almost 80 per cent booked for the summer.

While many small businesses have prioritised protecting jobs, a survey by financial platform Tide revealed that a fifth expected to make redundancies when the furlough scheme ends in September. With another 21 per cent unsure if they can support pre-Covid-19 numbers, owners need to be realistic about their staffing requirements. 

Technical requirements 

One pandemic outcome has been small businesses’ embrace of flexible working, which broadens the skillset available to firms whose staff can work remotely. “Small businesses tend to employ locally. But should we be looking at the whole of the UK?” asks Charlie Bristol-McClean, director of PlanB Consulting. 

It’s vital to have the right technology in place for remote working, but this isn’t the only driver for upgrading your set-up. Research from Lloyds Banking Group and Be the Business found more than 1.5 million businesses ventured online for the first time during the pandemic.

 

 

“When we think about tech adoption, we often see it in the context of innovation, delivering a new type of service or gaining a competitive advantage,” says Mr Impey. “But it is also crucial to building business resilience and dealing with continued uncertainty.” The right technology will put you in a stronger position in a world where more consumers are accustomed to online shopping and remote working.

The Red Sock Launderette and Cleaning Service in Grantown-on-Spey, which services locals and visitors to the Cairngorms National Park, is an example of a firm using technology to bounce back. “We are looking at more efficient use of IT to streamline processes from scheduling to invoicing, staff timesheets and pay,” says director Rebecca Reid.

“I’ve been communicating with Business Gateway and social enterprise Interface to move forward with these plans.”
Overwhelmingly, says Mr Gillies, businesses are realising that the traditional way of doing things will change.

“Technology means being able to reach clients all over the world at the click of a button,” he says. “We advise all our SMEs to look at ways to improve efficiencies, rely on technology and streamline operations.”

Help to digitise is one element of the government support designed to help small business recovery, with the Budget including a £5,000 Help to Grow grant for digital training and management. The Recovery Loan Scheme replaced other government financial support, while the Self-Employment Income Support Scheme was widened, with an extra 600,000 able to claim direct cash grants. In England, the Restart Grant offers funding for non-essential retail, leisure and hospitality businesses.

Finding funding 

Business owners should consider taking advantage of the low-interest financial support currently available. “Some small businesses don’t borrow because they don’t want to be in debt,” says Mr McClean-Bristol. “But if you’re likely to have cash flow problems or you’ve got a viable business that might hit hard times, borrow some money. You can always pay it back, but don’t go bankrupt just for the sake of not borrowing.”

Additional funding could be used to restructure your business model or pivot into a new sector. “We have a client that runs live events and relied on the wedding industry,” says Mr Gillies. “Now they are retraining, using their workspace to host virtual gigs, leasing out recording space, and even offering music tuition over video calls. Thinking outside the box – and not being afraid to go outside your comfort zone – is the way to pivot into success.”

Diversification, adds Mr Bristol-McClean, is the foundation of a robust business model. “If you’re running a very niche company, you’re vulnerable,” he says. “Not being too tied to one particular business stream means if you suddenly lose that business, you won’t be shut down. Operational resilience means being able to flex to deal with the outside conditions.”

In this vein, the Red Sock Launderette is pursuing year-round contracts that are not tourist-dependent, while 
The 25 B&B is exploring business add-ons. “I spent lockdown writing an online training course for people thinking of running their own B&B, passing on my knowledge so they can create a successful business,” says Mr Banner-Price. “We’re also in negotiations with a third-party supplier to provide picnics and casual dining in the form of grazing boxes that can be enjoyed in your room.”

 

The key is understanding your market, concludes Mr Impey: “One thing successful pivots have in common is that these companies knew what their customers wanted.”  

Switching focus 

Former photographer Ceri Jennings founded Barry-based Sparkles Cleaning Services Wales & West in 2003 after taking on casual cleaning work during a career break. The company now employs 30 people.

The first lockdown caused a significant shift. “Our commercial contracts were essential services, but domestic cleaning was suspended. We had working staff, furloughed staff, and staff who were shielding – every situation possible!” 

Sparkles kept trading by expanding into construction industry cleaning. “We purchased site-approved, five-point PPE for construction cleaners and hoovers to meet site requirements,” says Ms Jennings. “We asked staff to redeploy to support colleagues on the commercial side. For construction cleaning, they needed specific qualifications, and as soon as training centres opened they were ready and willing to upskill. We’ve worked together to safeguard jobs 
and I’m massively proud of what we’ve achieved.”

The pandemic provided Sparkles and its employees with new opportunities. “One of our aims is to help people who’ve found it hard to get sustainable employment,” she adds. “Cleaning was overlooked in the past – maybe it will be valued more now. The future looks good: we’ve learned a lot and are ready to expand.”

How to build-back better

1 Be open to opportunities: Build an online presence, upskill or forge new business streams with existing skills. Don’t be afraid to try something new

2 Get a fresh perspective: Seek out people who have faced challenges similar to yours or can take a step back and ask pertinent questions

3 Embrace financial support: Keep up to date with the assistance measures available from your national government

4 Employ the right technology: IT is an investment that pays for itself by helping control costs, manage resources and create new revenue streams

5 Take time to work on your business: Focus on building the right processes and empower your employees to take ownership of their work so you have the time to think strategically

 

6 Control cash flow: Cut back your overheads and ensure that every penny is spent in a manner that will benefit your business

 

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