Whispers of restarting the economy are building into conversations and escalating into announcements. Now is a tricky time to be an entrepreneur, or anyone running a business – starting one, restarting one, continuing one.
Opportunities will exist to deliver on emerging demand. Some businesses are already prepared to supply, others many need to reposition. I see many avenues for shifts in customer needs:
- Sudden spikes in things people couldn’t get during isolation. The intensity may be short term but play out over several cycles with phasing in of economic restarts and if there are resurgences of infection.
- Specific products related to continuing the fight against the pandemic.
- Declining interest in items people realize they don’t actually want or need.
- Impacts of economic contraction.
- New needs that evolve from whatever odd things we’ve been doing in isolation.
- Longer term shifts.
Here’s few of my thoughts on each of the above. There are many more possibilities in each category and likely other categories I haven’t mentioned. The scope of possible opportunities is broad.
1. Sudden huge demands for existing goods and services:
- Dining out. I’d predict this is a need to share a meal with friends, rather than a need for restaurant food. Many of us have been ordering more takeout than usual to support the restaurant industry.
- Personal care: haircuts, manicures etc.
- Healthcare for NON-Covid stuff. Many treatments have been postponed in the past couple of months. There is pent up demand for all the care that has been placed on hold during our isolation, including in allied fields, like dentistry, physiotherapy, and many more.
- Entertainment: movies, sporting events, concerts, art galleries, museums, etc.
- Deferred property maintenance. Many office and public buildings have sat unattended over the past two months that will need HVAC, plumbing and other systems upkeep. All this deferred maintenance provides opportunity for new entrants.
Over-demand will eventually be satisfied and decline to ‘normal’ levels of consumption. The opportunity is to attract new customers and a create a stable business, either as a new entrant or incumbent in the industry. If I were a leader in the industry, I’d try to meet the short-term request landslide, as failure to do so is likely to result in decreased marketshare.
2. Ongoing needs to fight the COV.
Clearly, PPE (everyone knows what this means now, right). Vaccines, drugs to treat COV infection. Floor stickers to remind people to stay 6 ft apart. Video conferencing. Health inspections. One of the most creative suggestions I heard recently was a need for pandemic planning for large organizations3. All kinds of services related to keeping us apart, sanitized and isolated if we have active infection.
3. What will we realize we no longer need? Questions that lurk in my mind:
- how will the concept that pollution has significantly declined while we have all stopped commuting to work and generally running around in our fossil fuel burning conveyances play out?
- how much working from home will continue as selected firms and employees discover efficiencies?
- which things that we previously viewed as critical will be abandoned post COV – fancy office settings, pre-made bread, elementary school teachers (unlikely but I had to throw it out there)?
An interesting story I’m drawn to, because I wouldn’t have predicted it: music streaming has decreased (for example https://variety.com/2020/biz/news/music-streams-down-why-spotify-netflix-1203547387/ ) . I would have thought people would have more time to listen to music. The key to finding the opportunity is understanding why something happens, especially if everyone is doing it for the same reason.
Pay attention to what surprises you, there may be opportunity there.
4. The predicted economic fallout suggests that there will be fewer people with employment and even those with a job will be more cautious in their spending habits due to uncertainty and economic downturn. What do cautious people want to buy, compared to optimistic, high-spending people?
Cautious wants: insurance, personal protection devices, low cost goods, value items rather than luxury items, seeds to grow vegetables.
Optimistic wants: loans, vacations, bling for the self, office, and garden, gourmet food experiences.
5. Recovering from the things done in isolation.
Stockpiling of food and cleaning supplies has happened. Either the food banks will be well supplied with canned goods for years to come or there will be a market for creative approaches to utilizing 18 bags of pasta, a dozen cans of peas, and a flat of pineapple chunks.
Similarly, I suspect many people started DIY home renovation projects: Torn out the paneling in the basement, drawn up plans for a second level in the garage, taken the sink apart in the extra bathroom. The appetite for finishing these projects may evapourate when out of the home distractions become available. Home renovation services may expand to finish the unfinished DIYs.
What are we going to do with all the PPE when we don’t need them any more, even after keeping a good supply? There will be a need to recycle a few billion N95 masks soon. There must be a business model for reclaiming the materials in face shields.
6. Long term. One thing that is sure to linger for years is the cost of the government subsidy programs that have kept us afloat during our internment. Ultimately, these will need to be paid for, through higher taxes, probably personal and business. This may mean restrictive economic times in the future.
The cost of business will likely increase. Take home lessons from the current economic situation include that redundancy is smart. J.I.T. is risky. Outsourcing can be tricky if international borders close down or local economies are disrupted. More control, less low cost. I hear inflation rumbling on the horizon, like a thunderstorm on a humid July day.
Rainbows follow the torrential rains of thunderstorms. I hope the world can look new in a good way. Opportunities are out there.
1This applies to either business or individual customers.
2B.C. Before Covid-19.
3Apologies to whoever said it. I’ve been to too many Zoom-inars, gathering fabulous information, and it’s all blurred into the cosmos of great ideas.