Today’s world is hyperconnected through communication, travel and trade. The global economy is so intertwined that an event in one country could lead to shockwaves in the rest of the economies. As such, previous pandemics and economic meltdowns did not have such a severe impact as the COVID-19 pandemic. It is quite a time for those alive to this fact.
Here in Kenya, measures recently undertaken are proving to be quite severe for the small business owner. It is unfortunate that many small businesses will or have already closed due to this pandemic. The interconnected nature of supply chains means that some businesses closing impacts others. A good example is the closure of hotels that in turn impacts their suppliers including farmers and even logistics companies that supply to them.
So, what can the Small Business Owner Do?
Tough times call for tough measures. Flexibility for the small business owner is paramount even in normal times. It is unfortunate that many will lose their jobs but as the government says, life and health of family members is more important.
The concept of rapid testing/experimenting, validating from the test/experiment, then either reinforcing or pivoting has its roots in lean manufacturing. Eric Ries made this well-known through his book, The Lean Startup. The idea behind this was that you should not wait for your product to be perfect in order to launch it. This has led to businesses consuming large and scarce capital resources only to find out in the end that the idea doesn’t work.
Being small should therefore be an advantage and this is where pivoting comes in during tough times. Essentially, this is the ability of a business to change its trajectory or direction within a short timeframe. But in times of a pandemic this may be difficult for many businesses as the modern business world has been built to balance perfectly on a scale. This means that more likely than not, your business leverages on equity sources vis-à-vis your income. Solutions such as invoice discounting come to mind.
Giving You Wiggle Room
There are several measures we have undertaken to afford small business owners the ability to pivot. Reduced transaction costs on our digital platforms and free transactions on PesaLink are some of the measures. Our relationship managers are available to enable continuity in business transactions. We are offering various solutions you can access remotely without having to physically visit the bank. Our digital banking and banking on the go solutions cater to this.
As you seek to pivot your business, you must, now more than ever, understand the current dynamics of the market. There are new challenges to navigate such as restrictions on movement. Avenues such as mobile commerce and ecommerce could prove resilient to this pandemic (by the way, our cards allow for shopping online).
Finally, plan for the long-term. The 2007/08 post-election violence and the 2012 court-contested election taught some of us to plan for 3 months. The 2017 rerun and eventual stand-off taught some of us to plan for 6 months. It looks like, as a small business, the new decade fraught with challenges is teaching us to look 12 months ahead. With flexibility built in, 12 months should be more than enough to pivot your business.