Oh wow! Are we going down to Level 3 next week NZ?
Time really has flown by. But so much has changed over the 4 weeks since lock down started. People are working from home, grocery shopping has become an epic quest and some of us have stumbled into entrepreneurship.
As this is the second last day before the end of my 30-day blogging challenge, I’m going to write about what I think the business landscape will be like in the months to come after the lock down. As always, I like to start this article with a disclaimer that I don’t claim to be the smartest person to talk about this, so whatever my opinions are – they should be up for debate and not taken as the final word on the subject. I mean, I have a PhD in Finance, but it doesn’t mean jack compared to the experience that other business experts have out there.
Ok, preamble done! Let’s see what the first prediction is:
More people will be working from home/remotely
Guess what! You can work from home! Especially true if you have a desk job that does not require any physical labor or skilled handiwork. In fact, the technology that allows you to work remotely has been in existence for at least 7 to 5 years now. The only reason that more people are not doing this is because many of us are still stuck in our traditional mindsets of dressing up formal, going to the office, bantering with colleagues, stuffing our face with morning tea that we never thought to consider the possibility of working from home.
It doesn’t help that many employers don’t encourage their employees to work from home. Something about ‘building team relationships and camaraderie by forcing you to sit in the same room as people you mostly pretend to like’ or something like that. It also doesn’t help that employee productivity is usually measured by the hours you spend at your desk, not the amount of work you put out. Having an employee at home means that you can’t see how many hours they are at their desk – how can you be sure they are doing work??
And then COVID-19 happened
And we’re all working from home. And guess what?
It actually works!
It actually is do-able!
I’m still producing work for my business without having to be on the physical premises. I still get to chat with the rest of my team and my clients through video conferencing software. I can make use of cloud-based applications to do my work online. I can still take calls from the comfort of my own home. Best of all, I can work with no pants on (its a personal choice)!
So the myth of having to work in an office has been completely and utterly shattered.
What does that mean?
It means that in the months to come, we can expect more employees to ask for flexible working arrangements that will allow them to work from home. Parents might even make it a requirement that they be allowed to work from home so that they can look after their children. I won’t even be surprised if some employees ask their bosses to allow them to work while travelling the world!
Employers are less likely to push back as they would understand that working from home is not the deal-breaker that they thought it was. In fact, it could be a great way to increase team morale and give people the flexibility to approach work how they want. Might even result in more productivity!
So yeah, working from home will become more of a workplace norm and employers that try to push back against this movement will likely find themselves losing out on valuable employees.
There will be a rise in Ghost/Dark Kitchens
As we head into Level 3 in NZ (Level 4 with KFC as a popular meme once said) takeaways will be allowed, which is great, as it allows restaurants to operate once again. However they can only do takeaways and people can’t visit restaurants like they normally do.
Prior to the COVID-19 outbreak, there was already a small, but growing movement of ‘Ghost Kitchens’. A Ghost Kitchen is a standalone commercial kitchen with no storefront. It operates solely as a takeaway and orders are made via phone/website/app. In fact, it’s not uncommon for Ghost Kitchens to cater under different brands since they can cook different types of food in the same kitchen.
Ghost Kitchens were already gaining popularity pre-Covid due to their low overheads and ease of setup. They will be even more popular now as customers start ordering takeaways as opposed to dining in. In the months to come, customer sentiment to dine in at a restaurant will be impacted due to health and safety concerns (even once we go down to safer levels, the fear will still be there) thus Ghost Kitchens will become a more attractive proposition for restaurant owners to reduce their storefront operating costs.
A potential business model that could arise is where owners of Ghost Kitchens could contract out their kitchen’s services to different restaurant brands. These restaurant brands would focus on branding and marketing their food, but their food would be cooked at the Ghost Kitchen to save costs. It sounds fairly dystopian, but I wouldn’t be surprised if this is what is already happening.
Businesses without a strong online presence will suffer
The internet revolution began more than 20 years ago. In the years since we have seen more and more businesses move online. These days, it is hard to find a business without a website or social media presence of some sort. It is the norm and no longer the exception to find businesses online.
That being said, there are many businesses that still rely on their storefront to generate sales. They may have an online presence but it is only a token presence to tick off that box. Given that COVID-19 has put a halt to almost all physical interactions, these businesses are losing out on a good portion of their income.
Businesses that have online stores or have invested in some form of online infrastructure will find that they can rely on this infrastructure to reliably generate revenue for them. Businesses that are 100% online will find that despite COVID-19, it is still business as usual for them.
What is the prognosis for businesses without enough happening online?
It’s not very good I’m afraid. It will take some time for the COVID-19 situation to recover globally, for life to go back to ‘normal’. But the new normal won’t be the same as the old normal. Customers will have shifted their buying habits online in a much greater way than before and even when things get better, they are unlikely to change back any time soon.
More people/businesses will buy local and support local businesses.
At the start of the COVID-19 outbreak, global supply chains were disrupted, forcing businesses to look local to re-establish their supply chains. That being said, while travel is still a no-go for most of the world, international freight seems to be moving again but the COVID-19 crisis has shown many business owners just how fragile that international supply chain is. I expect more business owners to develop stronger local supply chains which will help take away some of the uncertainty in dealing with international suppliers.
At a more personal level, we are seeing more individuals supporting their local businesses. Individuals are more likely to support the local cafe, restaurant and game shop as opposed to buying from big chains. As the movement control orders force us to stay local, I think that people become more aware of their responsibility to support local businesses.
Or I could be dreaming up that last paragraph and they could order takeaway from KFC.
Final Thoughts
The COVID-19 crisis is arguably the biggest disruption that my generation has ever faced. It will change the way we live and the way we do business in the future. I believe that for all small business owners out there, we need to be able to adapt with the changes to survive in the new business landscape that COVID-19 has created.
In the meantime, stay safe, stay strong and stay innovative to survive in the new business landscape that we are living in today!
Sudhir b