Pivoting in Business
I just got off a call with a client to discuss a brilliant pivot for the business he purchased using a business plan I created for him last year. The pivot was an adaptation to the new normal and to mitigate the losses from the delayed renovation and opening caused by COVID-19. A pivot usually occurs when a company makes a major change to their business after determining that their product/service isn’t meeting the needs of their intended market.
How to Pivot
This call reminded me of some other recent examples of businesses changing their operations to survive and sometimes thrive in the COVID-19 economy:
- You might have heard of the now-famous Goat-2-Meeting. That is the creation of Sweet Farm Foundation, a non-profit animal sanctuary in Northern California that is offering videos of their animals to be used for Zoom meeting backgrounds. Due to the popularity of their service, sales are slightly higher than this time last year.
- Lumen Couture makes wearables, which are fashion items that embed electronics and technology into stuff you can wear. They design fancy, red-carpet-type gowns that shimmer and sparkle when you’re walking for very high-end events and ceremonies. Because events and ceremonies are now on hold, they shifted most of their business to making masks, which people do want now. They designed a black mask that has a screen across the front almost like a scoreboard, saying things like, “six feet away.”
- Golem Bookshop, an independent bookstore in Turin, Italy started free deliveries by bicycle in Turin in response to a shutdown order in March and began offering curated selections of books – themes like revolution, obscure authors you’ll love, indie books. Customers loved the selections so much they started shipping orders all over Italy. Normally Golem sells about $7,000 worth of books per month but in April, they sold almost $20,000 worth of books; it was actually their best month ever.
In times of crisis, coming up with a profit or even surpassing last year’s sales is ideal but anything to mitigate the cash hemorrhage is fine. To pivot, for example, a business might have to change its revenue model which means potentially canceling contracts with existing vendors. This is one of many crucial decisions that the business has to make because once the pandemic passes and the current new normal makes way for the new-new normal, it may be difficult to get supplies in time and at the original pricing.
Each business is different and solutions are not one-size-fits-all. Contact us and let’s figure out what the best steps your business should take to adapt to the new normal.