Due to the far-reaching consequences of Covid-19, the need for South African entrepreneurs to reassess, rethink and reinvent their approach has never been as pressing as it is now.
“It’s amazing how a crisis suddenly makes hard decisions so easy.”Ryan Bacher – NetFlorist CEO
1. Become more resiliant
Resilience is the ability to bend without breaking,” says Dr Charlene Lew from GIBS. This and the ability to leverage existing assets and ecosystems of support, are all critical for small businesses fighting to survive the economic fallout from the Covid-19 pandemic.
“What distinguishes entrepreneurs is their ability to be resilient, to take on big challenges like this crisis that is wreaking havoc on the economy, and find within themselves the strength to be able to bounce back, identify possible opportunities and look for new markets,” adds Miranda Hosking, Director of the EDA at GIBS.
2. Look for the opportunities and solutions
While it is easy to get caught up in the narrative of how devastating the crisis is for the economy and for many small businesses, entrepreneurs have to “focus on the opportunities in crisis”. She says: “The fact is there is so much opportunity. We must have the courage to try something different. And then, of course, if you do fail, fail fast, fail forward and learn in the process.”
Head of Unlisted Equity Transactions at Futuregrowth Asset Management, Amrish Narrandes says: “An entrepreneurial mindset is absolutely key. Entrepreneurs, by their very nature, don’t run for the hills. They look for solutions,” says . Futuregrowth’s investments include tech start-ups Yoco and SweepSouth.
3. Be proactive
According to Dr Keith Fairhurst from GIBS, small businesses have to take proactive steps now to position themselves for the future. This includes lengthening the runway of your finances by reducing costs, turning unproductive assets into cash and exploring alternative revenue streams. Going back to basics and doing a budget, cash flow analysis and profitability assessment is also recommended. “Be curious and agile, adopt a new business model if required, ensure there is a market and customer for your service or product, and take stock of your resources,” he says.
4. Offer better value
According to Kantar’s Karen Du Chenne, Covid-19 has affected every sphere of our day-to-day lives, from the products we consume and how we shop, work and socialise, to our attitudes to life and how we run our businesses. SMEs need to be cognisant of this, in both the products and services they offer, as well as their marketing strategies.
“With less money to spend, consumers are paying more attention to price as well as to the value or benefits a product or service can bring. Faced by a world in crisis, consumers expect brands to impact broader society by taking action to build a better world,” she states. “In an era of shared humility, we all need to consider how we do things differently, how we market our businesses, and how we bring joy and share knowledge.”
Using the countless new digital channels that have opened since Covid-19 is just one way of achieving this.
5. Keep the lines of communication open
Dr Adrian Saville from GIBS has some practical advice for small business owners. “We are finding ourselves in the fog of war, and in this environment it is the strength of the team that matters. You are not in this alone – keep your communication channels open with employees, suppliers and customers alike.”
“Pandemics accelerate innovation and stimulate new opportunities. Real entrepreneurs can identify opportunities and turn them into viable business ideas.”
Dr Manoj Chiba from GIBS encourages entrepreneurs to think differently during times of crisis, and observes that “innovation is the key to small business success. This means using your existing resources differently to solve problems faced by your business as well as by your customers.”
Hosking agrees and adds: “Pandemics accelerate innovation and stimulate new opportunities. Real entrepreneurs can identify opportunities and turn them into viable business ideas.”
Tips from entrepreneurs
During a recent webinar hosted by the GIBS Entrepreneurship Development Academy, panelists offered advice and their key lessons for pivoting during a pandemic.
7. Use the assets you already have
Online flower and gift delivery service NetFlorist briefly became a food and grocery retailer during the initial hard lockdown period in April when only essential goods were sold. “We used the assets we had, including our online site, warehousing and delivery,” CEO Ryan Bacher explains. “Our pivot, besides giving us revenue, kept our senior management team active while so many businesses were closing their doors to wait out the storm. It really allowed us to feel like we had a purpose and were playing a role.”
8. Leverage your ecosystem
Leveraging your existing ecosystem means looking around and seeing what is possible with what you have. Fezile Dhlamini, founder and CEO of Green Scooter, explained how his grocery delivery service that uses electric vehicles began by using WhatsApp as a mode of communication with a focus on the township market. “Since the beginning of April, we’ve done more than 1,000 transactions using just three electric vehicles,” he says.
9. Nurture relationships
Sonto Pooe, founder of natural hair and beauty brand NativeChild, which has seen sales increase five-fold since national lockdown was instituted, advises business owners to pay special attention to relationships. “Every aspect of business has to do with relationships, whether it’s suppliers, customers or your own internal staff. It’s important not to overlook that part, because without that we have nothing.”
10. Make the tough decisions
“It’s amazing how a crisis suddenly makes hard decisions so easy,” says Netflorist’s Bacher. Lockdown and the subsequent disruption to the delivery business was the catalyst Netflorist needed to close its call centre and move all communications to a chat service. “For years we have wanted to change things but delayed,” he says.
“It’s been a beautiful struggle,” Green Scooter’s Dhlamini adds. “I wasn’t innovative in the process – Covid-19 coerced it.”
11. Think carefully about your core business
Bacher advises small business owners to think carefully about what their core business is, and “make sure that it’s ready for the post-Covid-19 world”. With regards to retail, he argues that people will “certainly go back into shops, but hopefully more people have experienced e-commerce and are going to be comfortable with that. So, we’re not going to be where we were before the pandemic.”
12. Upskill yourself
“Upskill yourself, spend an hour a day just learning something, set a goal and learn it,” NativeChilds Pooe concludes.