I don’t need to tell you that 2020 was tough year for small businesses. Since this pandemic started, one out of five small businesses has stopped operating. Stop and think about that for a minute. Picture an area in your city full of businesses. Now imagine one out of every five gone.
It’s unbelievable and sad to imagine.
For those that haven’t closed, reports show that 45% of small businesses have seen revenues less than 50% of what they were pre-COVID. They’re hanging on by a thread, held up by the Paycheck Protection Program, unemployment assistance and hope.
But it’s not all doom and gloom. Even after months of uncertainty, this is a fact: life will go on. And businesses that know how to adapt to these ever-changing times will be the ones that thrive.
Lessons Learned in 2020 to Help Small Businesses Thrive in 2021 and Beyond
I truly believe that it is possible to turn around a negative situation if you’re willing to learn from the lessons you’ve been presented. 2020 taught us a lot about resilience and how to adapt and survive. Let’s look at five big lessons learned:
- Being Prepared is Imperative
Many small businesses were caught unaware when they were forced to close their businesses for weeks or months. Given that the average business has cash on hand for about two weeks of expenses, many found themselves without the cash they needed to get by.
- You Must Be Able to Sell Online
Pre-COVID, many brick-and-mortar stores operated in person only. No ecommerce. But that has to change in order to survive and now we understand the importance of having a digital presence.
- You Must Have Your Business Paperwork in Order
Only 5.2 million small businesses took advantage of the Paycheck Protection Program. Many business owners who weren’t able to get a loan learned the hard way that you must have business documents in order. You must be operating with a business bank account. Your tax preparer is not your accountant. Business accountants reconcile financial records monthly. You have to have consistent, clean business financials at all times.
- Sometimes You Have to Pivot to Fix Your Business
What worked pre-COVID doesn’t anymore. 2020 was the year of sink or swim. Many businesses who refused to adapt their model panicked and sank, while those that were willing to shift how they operated or what they sold are going to survive. Some online sellers are having their best year ever.
- Out of Chaos Can Come Greatness…if You Listen to Your Customers
Some manufacturers shifted their business to making PPE and masks. Make-up artists started doing make-up lessons online. Some people leaned in and built a community online and developed a series of online courses for their target audience. And local businesses embraced their local community with clean safe spaces, outdoor tent dining, and contactless payments. Many local businesses are doing better than this time last year. Part of the recipe for success that comes from listening to your customers to understand what they really want. Whether that’s new products or how you communicate, even the small details matter, so open your ears.
10 Ways to Turn Things Around in 2021 and Thrive
So how do we get back on track, given that we don’t know what’s next? The best way to move forward is with a plan!
- Assess Your Business
Now is the time to find your new path to success and it may look vastly different. You may need to kill some products or service lines or develop new ones. The SCAMPER Formula can be useful to develop the best plan of action:
- Substitute– What can you substitute to lower cost?
- Combine– Everyone loves a combo offer, so create one
- Adapt– How can you adapt to meet your customer’s future needs
- Modify–Can you modify your offers to appeal to your client’s leaner budget
- Put to another use–Is there another audience or niche that you could pursue
- Eliminate– What do you need to stop doing in your business?
- Reverse– Can you go back to something you used to do and launch it again?
- Find Creative Ways to Pivot
Many businesses haven’t been able to operate in the same way they once did. Pivoting could save your business.
Here’s a great example: After it was forced to shut down, Your Skin Fitness Expert went from being a six-figure spa to a monthly facial club that sends members a monthly facial kit and tips for use. Master Magician Dan Chan went from giving performances at in-person corporate events to creating ticketed Zoom events.
Sometimes you have to be open to how your offerings need to change, as well as mindful of how you can best serve your customers.
- Review your sales process
Sales is the life blood of any business, use this time before the end of the year to tighten up your sales pipeline and map out your sales target list for 2021. Consumers’ buying habits have changed, online shopping is booming thanks to everyone being at home so it’s important to shift your sales process if necessary to accommodate new trends.
- Where do your leads come from? (Review analytics/sales data)
- Do you need a new lead magnet or sales funnel?
- What is your new content strategy for 2021?
- Is it time to invest in online ads?
Consider Other Channels for Selling Too.
What worked in the past may not work in today’s world. Look for more successful avenues to sell that you haven’t considered before, like Amazon, Ebay or Etsy. You could also create an affiliate program and get influencers in your industry to sell for you. Perhaps you could create information products to create a passive revenue stream as well.
- Leverage Technology
We’re moved swiftly in a digital-first society, but now’s the time to be proactive rather than reactive. Explore the best apps for marketing automation, (one of my favorite apps is MixMax for gmail and G-suite users), CRM, invoicing (Sage & Quickbooks) and video conferencing tools for your company, whether that’s Zoom or Google Meet. If you have employees, what’s the best way to communicate with them remotely? Slack is a great option for team instant messaging.
Also consider how your customers want to communicate with you. Open up the other lines of communication, such as live chat on your website, Whatsapp (video conference by phone), use a scheduler app such as Calendly so people can book :15 or :30 minute calls, try Sanebox for email, and make sure you are monitoring your social media accounts and your direct messages.
- Partner with Other Businesses
Remember: we’re in this together. Partnering with other businesses can lift us all up, so consider ways you could both support and receive support from another local or online business that relates to yours.
Here are a few examples. A restaurant could offer free delivery and discount to local brewery customers. A content marketing firm and a graphic design firm could bundle services together to offer more value to customers while getting more business. Online retailers could cross-promote one another’s related products.
- Give Your Customers What They Want
Now more than ever, it’s important to listen to what your customers want and need. To find out if you’re hitting the mark with your customers, conduct surveys to get customer feedback on service or products. Ask for your customers’ suggestions about your products.
There’s a health and beauty company called Pooka Pure and Simple that used the pandemic as an opportunity to connect with customers through its Facebook group. There, the brand got feedback that directly led to it creating a new line of products.
Give customers multiple ways to connect with you (social, email, chat, phone, video) and they want options to pay too. If you are in retail people want contactless payments. Make sure you have ample customer support in store and online to reduce wait times and needs to call.
- Master Working Virtually
Even if we return to our offices and storefronts in 2021, being able to work virtually anywhere will be key for many small businesses.
Create a dedicated home office with everything you need. You may have scrambled to set up a desk in your closet when the pandemic hit, but now’s the time to invest in setting up a space that is conducive to getting work done. That might mean converting your guest room, basement, garage into a workspace. Set up rules so family doesn’t disturb you during work hours. They need to understand that, even though you’re home, you’re busy.
And if you participate in video calls frequently, invest in lighting. LumeCube is a great option. You’ll also want to get a wireless mic or earbuds, and be mindful of the background that video shows at home. You want to maintain a professional demeanor, but if you have a pile of laundry teetering on the couch behind you, that might not be what you evoke.
- Use Your Data to Measure Your Marketing Efforts
Understanding what works for your business is all in the data. It might sound highly technical, but today’s analytics dashboards are pretty intuitive, even if you’re not a rocket scientist.
Look at Google Analytics to see where your web traffic is coming from and invest more effort into those channels while pulling away from those that don’t send you much traffic. Analyze social media stats to see what types of content is working to drive engagement, and create more of that. Focus on the marketing tools that bring the best bang for your buck.
If you want to change anything for better results, change just one thing at a time and measure results again.
- Plan Your Budget and Finances
You may not be able to afford all the marketing, payroll, and operational expenses you used to. Make temporary cuts that will keep you afloat until revenues return to normal.
Take time to review your bank statement. Cancel any unnecessary subscriptions or services you’re not using or can live without.
- Be Flexible
The truth is we don’t know what’s coming next or how long this pandemic will impact us. It’s important to continually review and tweak your business plan and know that it might change. Adapt your marketing strategy as needed; likely you will need to explore new marketing avenues to reach customers. And constantly look for creative ways to drive profit into your business.
Want more help? Grab a copy of our free eBook, How to Recession Proof Your Business or grab a copy of my Fix Your Business book, where I share a 90-day plan get control of your business and get back your life.