Starting a business during a global pandemic may sound far fetched, but industry experts say now is the opportune time to begin.
Jaffas, Fantales and Milo were all created during the Great Depression, and Apple, Disney and Microsoft all had rocky beginnings, as well.
But first: Can you picture the person for whom your business has a solution?
If so, will you be able to get that solution to them in the right place and at the right time? And would they be willing to pay for it?
That is Step Change chief executive Ashton Bishop’s formula for business success.
Mr Bishop told The New Daily that providing a unique solution to a consumer problem, or fulfilling an unmet or emerging need, is key to commercial success in any climate – and particularly one with declining demand for discretionary products.
But it’s not the only thing entrepreneurs must get right.
COVID-19 has accelerated some trends and forced others in a different direction, so aspiring business owners will need to unpack the effects of the pandemic to determine which opportunities to capitalise on.
“As they say, a rising tide lifts all boats. If you can jump in that lake where the water’s rising, your boat will rise,” Mr Bishop said.
But what makes now such an opportune time to make that jump?
Mr Bishop said employers have access to “global talent like never before”.
And they can also retrain and shift highly skilled workers from hard-hit industries to other jobs.
He said a friend who owns a transport company received a job application from a pilot who wanted to drive a truck because they couldn’t get any other work due to the pandemic.
“You’ve got these incredibly skilled people looking for work in sectors and categories they previously wouldn’t have considered,” Mr Bishop said.
There’s also more room to make a name for yourselves.
Many big players reduce their advertising spend and promotions in an economic downturn, making it a “great opportunity” for smaller contenders to grab market share, said business coach Brook McCarthy.
Advertising tends to be cheaper and more effective because fewer rivals are marketing their goods and services.
That’s important because most of what you’ll be doing as a small business is sales and marketing, Ms McCarthy said.
COVID-19 has also made identifying people’s needs a whole lot easier, said marketing consultant Chris North.
“People tell you a lot more about what they want now … because people are actually faced with dealing with the issues of the day,” Mr North said.
It’s also created a situation where you’re forced to investigate your own passions, not just follow them, he said.
Say your dream has always been to open up a bar. Ask yourself: Is it because I am passionate about customer service? If so, then perhaps you could start a business that uses your expertise as a customer service professional, in an industry that has been less affected by the pandemic.
The biggest benefit is they can employ more appropriate risk management strategies, according to investing expert Gary Stone.
“You’d have a far, far greater sense of risk now than what you would have six months ago,” he said.
“The odds are – six months ago – you would have set your business up without taking into consideration the risk that you would have just absolutely crashed and burned because of the risk environment that we’ve gone into.”
Matthew Addison, executive chair of the Institute of Certified Bookkeepers, said there would also be suppliers wanting to get rid of equipment.
“Will the equipment become cheaper? The economic theory would say yes because there’s going to be less demand and there’s going to be an oversupply. To sell it you’re going to have to drop the price,” Mr Addison said.
Even investing time into starting a side project could mean investing in your future, said business coach Carolyn Ryder.
“Is it a good time to sign a lease and open a bricks-and-mortar business? No. Is it a good time to start that online business you’ve always dreamed about? Yes,” Ms Ryder said.
So, are more people making that jump?
Before COVID-19 hit, business coach Ms McCarthy saw between three to four clients a week.
That number has since shot up to 10.
As a result, she generated more money in the past three months than any other quarter in her 12 years of self-employment.
Meanwhile, John O’Brien, an entrepreneur who founded and heads global pool service brand Poolwerx, said his company had seen a significant rise in inquiries for new franchises.
“Our store footprint and revenue grew more than 50 per cent in the five years following the GFC and we’re pre-empting a similar level as our economy recovers,” Mr O’Brien said.
Even if the road to success gets rough, one of the biggest advantages small businesses have is their ability to pivot quickly, said Trung Vien, entrepreneur and recent founder of Hair Folli.
“They don’t have all this infrastructure, all this red tape, all these people to move around,” he said.
“So being a small business in this time is actually really awesome if you know what you’re doing and you’re able to adapt really quickly.”
To get started, business coach Ms McCarthy suggests you:
- Register for an ABN
- Write down your practical skills
- Compile a list of possible services that you can provide
- Email everyone you know. Tell them about the services you’re selling and ask them to refer people to you.