Contending with the New Normal: How Businesses Are Staying Alive and Preparing for an Unfamiliar Future
Christopher Lochhead, a CMO turned podcaster, offered up a blunt assessment of the future of business in a post-COVID-19 world recently.
“There’s no back to normal,” Lochhead said, while moderating the most recent virtual event in Oracle NetSuite’s Open for Business series. “The life we knew in February is something we’re not going back to.”
Lochhead’s trio of panelists shared that perspective, offering varying takes on the uncertainty their businesses are confronting.
For instance, Julian Love, chief business officer of St. HOPE Academy, a nonprofit operating charter schools in Sacramento, Calif., said the organization has found it hard to provide definitive information on anything, including things that are normally set in stone, such as graduation plans.
“We don’t have the answers right now,” said Love, “and quite frankly, nobody does.”
What St. HOPE has been able to do is take the steps necessary to survive. That’s meant applying for a Small Business Administration Paycheck Protection Program (PPP) loan and getting deferrals on mortgage payments. It’s also meant handing out Chromebooks to the 50% of its students who lacked the tech necessary to participate in distance learning, as well as ensuring that all students have sufficient connectivity.
When and How to Reopen?
Jason Balk, CFO of Grand Rapids, Mich.-based digital advertising firm Adtegrity, said his company is trying to determine the right time to open up its offices again and how it will go about doing so. Balk said some employees have made it clear they’re not comfortable coming back to an office environment anytime soon and that it’s become the responsibility of the business to support a remote work environment.
It’s all going to force Adtegriy to do things a lot differently than it did before the COVID-19 outbreak.
“Business in January isn’t going to be reflective of business next January,” said Balk.
Adtegrity felt the pinch almost immediately, with business dropping off by 40% in the first weeks of the pandemic. Things have been picking back up slowly, but budgets have been slashed and advertising strategies are up in the air.
“A lot of people are conflicted about what messaging they should put out in public right now,” said Balk.
Adtegrity has been able to avoid any furloughing of employees thus far. In addition to obtaining a PPP loan, the company has been able to reduce employee hours without asking anyone not to work. Once the PPP funds arrive, they will cover two and a half months of benefits and salary. Without that assistance, Balk said layoffs would have come soon.
But what will happen if business doesn’t return to some semblance of normalcy before the funds run out is an unknown.
Tailwind Nutrition also saw its business negatively impacted by COVID-19 almost immediately: The company, which makes endurance foods for athletes, has relied heavily on retail channels that now are only offering core services, such as bike repair. Additionally, its international business (the company distributes in 28 countries) evaporated.
“For most of March, we were trying to figure out which way was up,” said CEO and Founder Jeff Vierling.
The company has been able to keep afloat thanks to sales on Amazon and its own website, and it also got a PPP loan that’s enabled it to retain its entire staff to date.
But Tailwind’s future is very much in question as society grapples with how large-scale events will look going forward. With the Olympics postponed for at least a year, and the likelihood that athletic events scheduled for the fall aren’t going to happen, the company has had to shift its orientation from contributing to athletes’ training to simply helping them stay in shape.
How long the company can maintain that strategy is far from certain. For that reason, Vierling said he plans to be completely transparent with his employees about the state of the company.
“We don’t know what the future holds,” he said. “But if you’re not transparent, there’s more fear that comes from uncertainty and not knowing what’s going on than even getting bad news.”
Not Going Down Without a Fight
Even as they contend with all of this uncertainty, businesses are also finding a way to contribute to the COVID-19 battle.
For St. HOPE, that’s involved serving free breakfasts and lunches, not only to its 2,000 students, but to the community at large. Love said this was not something the organization was set up for, but it’s been doing it for weeks now.
Tailwind, meanwhile, discovered an unlikely way to jump into the fray: It found out that its endurance formulas would help front line hospital workers, who were struggling to get through long shifts. The company has been shipping its products to hospitals around the country to help keep those workers energized.
“It’s very gratifying to know we’re making a difference,” Vierling said.
Yet he can’t help but think about the small businesses that are struggling all over the country. And while Tailwind was able to get a PPP loan, not every small business has been so fortunate.
“Time’s ticking down to days for a lot of businesses,” Vierling said.
Balk is hopeful that more fairness will enter a process that’s seen multi-billion-dollar companies take loan funds meant for smaller, needier businesses. In the meantime, however, he suggests that small business leaders be honest with their employees and customers, and take care of them as much as they can. The unknown might just turn into something positive before too long.
“Keep your hands on the steering wheel,” said Balk. “You never know what might lie ahead.”
Originally posted on Netsuite.com by Barney Beal.