Pivot Small Business Strategies for Success during Crisis

Remember six months ago? We were all told to hunker down in our homes to help ‘flatten the curve’ of hospital admissions due to the latest pandemic. Well, spring has come and gone, summer flew by and we’re moving into fall. And, depending on where we live, most are still under some level of lockdown and isolation. During this passage of time, thousands of small business firms have been struggling to find ways to pivot small business strategies and adjust their business models to stay afloat.

There is no ‘Get out of Jail Free’ card with this pandemic. Rich or poor, living in the US or on the other side of the world, the pandemic has hit nearly everywhere, taking the lives of millions through no fault of their own. It doesn’t matter what type of small business you have, everyone is feeling the consequences from this long-term pandemic. For these reasons, small business needs to be creative and flexible enough able to pivot to not only survive, but thrive this crisis. You may find this Guide from Dreamhost.com helpful as you begin your quest for the best ways to pivot your small business strategies to change your direction enough to come out on top at the end of this pandemic.

“It is not the most intellectual of the species that survives; it is not the strongest that survives; but the species that survives is the one that is able best to adapt and adjust to the changing environment in which it finds itself.” Charles Darwin

4 Ways to Come to Terms with Needing to Pivot for Survival

Let’s start with some clarity: What does Pivot mean for a small business owner? The easy answer: it is a change in direction of your strategies from what you have been doing. Let’s call what you have been doing successfully Plan A. When something big happens, disrupting the way you do business, or can do business, you likely will need to create a Plan B to adapt to the disruption. A pivot may be temporary or become a new part of your business model moving forward. Here are a few ways less complicated pivots you can make to find another way to success:

Embrace the pivot – it can become your new best friend. Your small business is definitely not the only one to be greatly impacted by the current crisis. Don’t forget that great companies were started during times of crisis throughout history. They started with great ideas on how they could help fulfill customer needs. You can too. Don’t focus on things that are totally out of your control, think about the things you can adapt and control. What changes can you make to strengthen and support your business and our latest version of Normal?
Time to embrace an e-Commerce approach. Recent surveys and reports show people are still buying, just differently. Some have maintained their normal shopping habits and locations, but more are shopping for essentials on the Internet. Ask yourself: what can your business provide online? What sections or phases of your typical processes can be done online rather than in person? Millions of people have been forced to work from home, teach and entertain their children from home and deal differently with aging parents. How can you help?
Review your existing assets and resources. Customers have new needs forced upon them by this Coronavirus. Lives have changed, resources are more difficult to find. You don’t need a 180-degree pivot in a totally different direction, but it could be necessary. Use what you have available now, just align those resources to meet customers’ current needs. What changes in how you use your assets and resources can be made to fulfill current customer needs?
Strengthen relationships and loyalty with existing customers. I know it sounds cliché, but we really are all in this together. We are facing emotional times. Let customers know you care and understand what they are going through. Don’t disappear and be forgotten. Post your availability to work on your website, in social media, email messages and newsletters. Inform customers you are open to serve them the best ways you can. Personal phone calls or on-line face-to-face meetings through a digital conferencing platform are even more personal. Don’t be afraid to let them know how they can support you as well. Stay in touch to strengthen your business relationship and stay top of mind for them.

3 Places in Your Business Model to Look for Pivot Points

Pivoting is really nothing more than making changes in your business strategies. What used to work might not work as well – if at all – under present day circumstances.

Are you wondering how to go about looking for areas of your small business strategies open for pivoting? And, how can you go about this important analytical process? Identify the best places to look, and then start asking yourself a lot of basic questions beginning with ‘who’, ‘how’, ‘what’. See, easier than you thought it would be. These three areas to begin looking for pivot points were offered by business.com.

Value proposition: What value do you deliver with your product or service? Are there any glaring unfulfilled needs in today’s environment? Think about things like customer health and safety in their homes, working from home and at-home education. What solutions can you provide to service those areas? You know how you have been serving customers, and with what resources, under normal circumstances. What changes will you need to make or new directions will you need to move in?
Value networks: How do you deliver and monetize your product or service? Depending on your usual products or services, consider other ways you can use to get them to customers. The restaurant industry pivoted from dining in to take out and home delivery. Department and grocery stores now offer no-contact curb pick up of items ordered online.

If you operate in a B2B (Business to Business) market, is it time to try switching all or some of your distribution to a B2C (Business to Consumer) model? Can all or part of your product/service be delivered via electronic/digital options? Can you change payment terms and methods to help customers buy what you offer?

Supply chain issues are affecting costs, availability and lead times of important resources. If your usual suppliers can’t deliver in a timely manner, look for options that will allow you to embrace a ‘better, cheaper, faster’ approach for now. Are there other products or services you can offer with existing resources? Remember My Pillow seamstresses making masks and breweries redirecting their alcohol supplies to make more hand sanitizer.

Target customers: Who receives and benefits from what you provide? People are still buying, and are perfectly OK receiving marketing messages from companies they deal with. You just have to change how you reach out to them. Don’t just rely on your existing customer base, go after new clients. Consider what other customer segments you can approach to expand your revenue streams.

Operating Your Small Business Like an Entrepreneur, Ready to Pivot

Sometimes it is better to look back when wanting to move forward. Everything that is old or has been replaced a new version is not useless. American business executive, entrepreneur, and author Martin Zwilling wrote an article wrote an article for Forbes nine years ago. His article featured 10 Ways Entrepreneurs Can Pivot a Lean Startup. Of that list, four of them caught my attention as easy approaches for pivoting small business strategies like yours:

4 Pivot Types for Small Businesses Operating like Entrepreneurs

Customer segment(s) pivot. Your product may attract real customers, but not the ones in your original business vision. In other words, it solves a real problem, but needs to be positioned for a more appreciative segment, and optimized for that segment.
Customer need(s) pivot. Early customer feedback indicates that the problem solved is not very important, or money isn’t available to buy. This requires repositioning, or a completely new product, to find a problem worth solving.
Channel pivot. In sales terminology, the mechanism by which a company delivers its products/services to customers is called the sales or distribution channel. Channel pivots can require changes in pricing, features, and competitive positioning. Benefits and marketing messages may require changes.
Technology pivot. Sometimes a startup discovers a way to achieve the same solution by using a completely different technology. This is most relevant if the new technology can provide superior price and/or performance to improve competitive posture. Technology continues to change rapidly. There may be a number of new equipment or software applications to make major changes in how you operate your chosen business model.

4 Tactics in Pivoting Small Business Strategies for Survival

I know that this can sound a bit overwhelming. Most everything happening in the past six months has been overwhelming and stressful. Take an approach you can manage without adding to your stress level.

Work on what you can do now. The ideas is to not rush into anything, but identify pivots you can make right away.
Improve your own, and staff, skill sets. There is no time like the present to invest in yourself and your company skill levels. An abundance of online educational programs are out there. Find a weakness and a course or program to improve it.
Get feedback from staff, colleagues and clients. As you work through analyzing what can be changed in your business, ask those within and outside your company what they think about your ideas.
Seek input from a mentors or coach in your field. Seek help if you are already stressing out in ‘overwhelm’ mode. Those with appropriate skills can make your pivot process quicker and less painful.

Useful Resource:

Back in 2011, while we were still bogged down by the 2008-09 Recession, business consultant and author Eric Ries put out the 2^nd edition of his book The Lean Startup . Focusing on the need for entrepreneurs to apply continuous innovation to create highly successful businesses.

The biggest take-away of his book was knowing when to pivot and when to persevere on the current track your business model is on. Reis’ premise: know when to shift your business model to meet customer needs and when to continue on the bumpy road of failure, hoping to eventually get where you want to go. There has never been a better time to utilize his advice.

Conclusion:

The Harvard Business Review published a research report, ‘Roaring Out of Recession’. The research involved 4,700 public companies and how they navigated the last major recession. They found that three years after the recession:

17% of the responding companies did not survive.
About 80% had not yet regained their pre-recession sales and profit growth rates.
Just 9% “…flourished after a slowdown, doing better on key financial parameters than they had before it, and outperforming their industry rivals by at least 10% in terms of sales and profits growth.”

That 9% of survivors found the delicate balance between massive cost cutting to survive today, and investing to grow positively after the recession. Do you want to be in the 9% of survivors, join the 80% that did not regain their pre-recession ground or the 17% who are just gone? For now, I offer these three suggestions for beginning a pivot for your small business that can take you in a different direction to success.

Stay positive and focused on how you can keep your small business alive and poised for growth again on the other side. We truly are all in this together. Know that should you need help working through a pivot analysis and process, we are here to help. Like many of you, working from home, virtually, is not a major change for Maurer Consulting Group.