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Getting Past the Pandemic and the Next One

The estimates vary, but I’ll pick a number. The number doesn’t matter as much as the implications. Twenty percent of businesses have gone out of business due to the Covid-19 pandemic and the various governments’ responses to same. There has been much political and journalistic hay made from this topic, but I’m going to attempt to go in a different direction here. (Bear with me if I get sidetracked, this topic makes me furious and I might type something and mash the post button before deleting it.)

Covid is. It is part of the landscape now. Maybe we get past it, maybe we don’t. Maybe things ‘return to normal’ maybe they don’t. Also, Covid will be. It will happen again. It has been demonstrated that the populace can be cajoled, coerced, shamed, and even welded (in China, coming soon to other dictatorships) into their homes. The world has demonstrated its ability to shut down. Now that we know it can be done, it will be done again.

So we have two facts. We have an altered present, and the likelihood of an altered future. It does no good to whine and complain. Believe me, I’ve tried. What we must do instead of (or along with if you insist) the whining is figure out how to not be in that twenty percent. This is a first pass at figuring that out.

Some businesses were more affected than others by the shutdown. Obviously being an ‘essential’ business, such as a liquor store (whatever) was an advantage. So one strategy might be to position your business as essential in some way. What is essential has varied from state to state, and I haven’t kept up with what is essential in other countries. But here, if you were a gas station, a supermarket, a hospital, or a bank you were golden. In my home state of Alabama hardware stores and technology stores were also essential. (I wonder how Governor Ivy is enjoying her new MacBook Pro courtesy of Best Buy, and her new Home Depot privacy fence. Just kidding, I know of no such thing.) If on the other hand you were in California, no computers for you and no do it yourself homeowner projects, no matter how much free time you have. But on the plus side you could make a quick run to the pot shop and pick up some get you high gummies. Heck, you could even have them delivered. If you’re fortunate enough to live in Colorado you have all of the above, plus firearms stores. (Alabama, hear that?) The point is, know what the gods of your state deem essential.

If you can’t be essential, find a way to comply. Most restaurants were able, with a little ingenuity, able to set up take away services that complied with the Covid regulations. Virtually all of these things were nonsensical, but they fit the letter of the law and allowed the restaurant a chance to continue to exist. When I say nonsensical I mean that they are unlikely to really make a difference in the spread of the virus. For example, if you go through a fast food drive through they may put your food on a tray for you to grab instead of handing it to you. They put it on the tray. The virus can live on the bag or cup. But you didn’t take it from their hands, so you’re good. They made it. For all you know they spit in it. But it was on a tray, so it’s all good. Whatever. The point is to find a way to satisfy the compliance authority that you are obedient and fearful, and you can remain open. (Damn it, I really didn’t want this to be this kind of article, but this is what happens when I think about this. Ignore my attitude about this point and find a way to comply so you can remain open and save your business.)

It’s too late to build a loving customer base if you’re in the thick of it. But if you survive this, start thinking seriously about your customers. Hanging a shingle and being open for business isn’t good enough any more. Your customers need to be willing to cross the street for you. They need to be willing to cross the town for you. They need to be willing to violate curfew for you. Not literally, but you get the point. Having customers is no longer enough. You need a tribe. I know that sounds a bit nuts, especially if you sell, well, nuts or something, but a devoted, even rabid, customer base can carry you through things like this when casual customers will just stay home and eat Ramen. Your customers have to be people to you, and you have to be important to them. During this pandemic I’ve eaten at a few restaurants. Far fewer than I used to. And no new ones. As a matter of fact, I’d say ninety percent of my eating out has been at three restaurants, two of which I know the owner personally, the third is directly across from where I work.

When people are fearful, they don’t explore. I visit one hardware store, two groceries, one art supply store, no book stores, and Amazon. I do not love Amazon, but it’s familiar, and painless. That’s about it. The drivers of my spending are personal relationships and familiarity.

For the present, try to pivot. Explore delivery options. Explore alternative advertising. Look into partnerships. Try to alter the government’s regulations. (I’m not sure who talked the government into allowing restaurants to sell cocktails to go in Alabama, but kudos. We don’t even have a lottery and now we have drive through liquor, well done. But that didn’t happen on its own.)

In severe circumstances, rebel. Call attention to your plight. Here in Alabama we’ve had barbers and hairdressers say enough is enough and start their businesses back up as safely as they could. Individual stories ended differently, but the final result is that now, if you feel comfortable doing so, you can get a haircut in Alabama. One bartender in New York declared his bar an autonomous zone. He started giving away liquor and food for donation. At the time of this writing he’s losing his battle with ‘the man’ but these things can turn on a dime. I like his chances. I would have liked them more if he, and all his business neighbors had banned together and opened in unison. At the end of the day the only enforceable rules are those that we as a society agree to. This is the concept of the ‘consent of the governed’ in action.

***Quick side story here, because it’s relevant to the above paragraph. After September 11th, we put a lot of changes into the airline boarding process. I will not dignify this process by calling it a security process, because it is not. It’s caught exactly zero terrorists, and resulted in lots of fines for good citizens. It’s a security theater process. It’s there, like surgical masks and little circles on the floor to make us feel safe. Anyway, the TSA let this dude through who had a bomb hidden in his shoe. They didn’t catch him. They let him through. He got caught trying to light it on fire on the plane. Now we all take off our shoes. This other cat had a bomb in his underwear. Do we take off our underwear? No. Why? We. do. not. consent. That’s it. If we consented, we’d have naked flying and anal probes before each flight but we said no. So, if the rules are too bad, if they’re killing your business, build an army and peacefully resist.***

That’s all I can think of regarding what you can do now. But what can you do to prepare for next time? Well, let’s ponder. I guess the first thing was mentioned above. Build a tribe. Be fanatical in your customer relations. It will help to build those relations if your product or service is phenomenal as well, so work on that too I guess.

Next, realize that this is going to happen again. Have contingency plans. Maybe someone will come up with an insurance product. Don’t be surprised.

Ask yourself, would you rather have a hundred percent of a smaller business or zero percent of a larger one. What I’m pointing to here is that business owners often leverage money to grow their business. In good times debt is not so bad. In bad times it is a millstone around your neck. Imagine two businesses, each with a few employees, some inventory, and a building. One business owns the building and the inventory, but the other has a lease on the building and the inventory is floor planned from a supplier. Which one lasts longer when things go south? There is a place for debt, but weigh your debt load against possible downside events, even black swan type events like Covid. Financial stability will increase your business’s chances of survival.

Have a team. At a minimum (and I’ve been preaching this long before Covid hit) you need an insurance agent, a lawyer, and a banker. I prefer all of them to be local, and with smaller companies. Yes Mega Bank might give you a slightly better rate on a loan, but if you need help dealing with a government loan program who, BY NAME, is going to help you with that? If there is a disagreement about what is covered by your policy, who is more likely to come to bat for you, your Geico phone rep, or the State Farm agent you just had dinner with last month? Speaking of which, put these three people on your board of advisors and buy them dinner once or twice a year. Having them in the same room will be worth the tab.

Apply for everything. There is a lot of help out there. This time around there were grants to pay employees, loans, so many handouts. And if you’re a business person (I hate writing this but we’re tying to save your business so I’ll suck it up. You should too.) these are for you. There is no room for pride. The economy is depending on you. That is why we’re giving away trillions of dollars. Shut up and take the money. Grouse and take the money. Call it theft if you want to but take the money. The collective we has made a decision that your business is worth supporting for the greater good of the country. You can disagree. I do. But take it and stay in business. And don’t tell me you’re tired of filling out forms. I sympathize and could do a whole rant on the ‘how’ of how we do things. But it is what it is. When you signed up to be a business owner, the bargain you made was to work eighty hours a week to avoid a forty hour week. It’s time to live up to that bargain. You’re not in your business making sales, or this would be a moot point. Go to work.

Get creative now. Ask yourself, how could you go digital? How could you sell on Amazon? How could your business survive on ten percent of its current customers? You may not have an answer to every question, but ask them. Try to answer them. Do it now, with the craziest things you can think of, so that when crazy happens, you’re prepared. Right now I’d be asking myself, how is my business different if the country is in a civil war. Do I think that’s going to happen? Nope. Not very likely at all. But it’s worth considering. I’d be asking what happens if inflation hits really, really hard. Will it? Don’t know. Think it’s more likely than civil war, and definitely worth preparing for. What happens to my business if we get very high tax rates? Is it likely? Don’t know. Somewhere between the first two conjectures. But it’s worth game planning now, so I have an answer when it becomes very important to have an answer. You get the idea.

I’ve laid out a couple lists of things to consider to attempt to covid (or whatever) proof your business. I’ve laid out what to do if you’re in it, and what to do to make it easier next time. These are my thoughts, and mine alone. I’ve stayed mostly on topic, which is pretty good for me. In order to improve this list, let me know what you think. (Note the friendly comment box below.) If this ends up getting a wider audience I’ll try to make sense of the comments and put together a more orderly and reasoned essay. One thing, don’t argue about Covid. I do not care what you think. It’s been politicized to the point that virtually no one is rational and I won’t engage. I’ll just delete. Go forth. Create value. Profit. Enjoy life. Give back.

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