Smart business owners are already thinking about where their business will be when the COVID-19 crisis is over. Many are using this time to remodel facilities, boost brand presence, and reposition their business during the crisis to better serve the community in order to engender goodwill when all this is over.
We don’t know what the economy will look like when this is over. Everyone agrees it will not be as hot as it was in Q1, but beyond that you can find projections from the most optimistic discussions of pent up demand and a burst of Q3 activity to pessimistic analysis that says this will be as bad as the Great Depression.
The idea that we’ll enter another Great Depression is quite far fetched for reasons that are beyond the scope of this article, but let’s imagine that it’s true. What if we do enter another depression. Double digit unemployment and a shrinking GDP. What is the right course of action?
The kneejerk response is to batten down the hatches and reduce all non-essential spending. This is a good response to a short term crisis, but it is catastrophic in a long term one. No business ever cut their way to success.
When the economy contracts, each market within also contracts. It does not vanish, but the available pool of customers becomes smaller. The effect is not consistent across all providers. The best providers will feel an impact, but not a dramatic one. The worst will find their customer base dries up and vanishes, pushing them rapidly into business failure.
What determines what kind of business you will have? Preparation and attitude. If you run a $5 million business in a $5 billion industry, then it doesn’t matter if the market drops in half as long as you can still make your $5 million, right?
The businesses that survive and thrive in a downturn are those that invest in the right way. Those that build capacity, build brand, and show confidence. The ones that say “times are tough, but we’re here 100% for you,” and say it boldly and proudly, are the ones that the remaining customers will trust with their hard earned money.
I cannot tell you what the economy will look like coming out of 2020, but I can tell you that the companies that will be thriving at the end of the year will be the ones who invested today in engaging their audience and prepared to capture the post-quarantine market boldly. The ones that choose to wait and see will wait and see their competitors blow by them in the fall.