Over the past few months, we’ve looked closely at the behaviour of business owners through the Coronavirus pandemic and the approaches they’ve taken to maintain viability through this particularly disruptive time.
In our last article, we discussed ‘flight to safety’ and here we explore how other businesses are embracing a ‘time of opportunity’ approach in context of COVID conditions.
Triumph over adversity may well be the catch-cry for many business owners who held their heads up and proactively looked for opportunities as COVID unfolded.
The term ‘pivot’ is frequently used, almost as a call to arms for those businesses seeking to restore viability through invention. There have been many well-publicised examples; you may have heard about the gin distillers that pivoted to make hand sanitiser or the car manufacturers that made ventilators.
A ‘time of opportunity’ is perennially present and a common stage in a business lifecycle. However, it has been suddenly amplified under COVID conditions.
This was very much the case for a local wine merchant we advise. The focus of this business was to supply wine to high-end restaurants. They were forced to close during the initial April 2020 lock-down, and when they reopened, trade was sporadic depending on the restrictions.
The opportunity the business owners recognised was to supply the wines usually reserved for restaurants only, to their bottle shop customers. However, their stock was sitting in closed restaurants and, what’s more, it hadn’t been paid for.
In what was a win-win situation, the wine merchant offered to take the stock back and raise a credit on the unpaid accounts.
As you can imagine, the restaurant owners were ecstatic as managing their cashflow while retaining good terms with their suppliers was a big part of their COVID problems. The bottle shop owners were equally delighted, as they had access to in-demand restaurant-quality wines, suddenly sought-after by customers unable to go out for a meal.
Embracing this opportunity had positive knock-on effects, including considerable goodwill with both their restaurant and bottle shop customers. For the business owners, they averted a bad-debt situation and turned it into a growth opportunity.
This type of business confidence is underpinned by financial clarity which included knowing who their customers were and the challenges that they faced. Armed with a clear understanding of the numbers, along with cashflow projections and often predictive modelling that demonstrates the likely financial outcomes of different decisions, business owners can find the change they are looking for to act during ‘a time of opportunity’.
P+Y Accountants and Business Advisors are known for expanding the possibilities for professionals and enterprising business owners.
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