Think outside the box – can your business adapt in a fast changing world?

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Following the impact of Covid-19, Kiwi businesses are adapting and diversifying to navigate their way through the crisis and help kickstart the economy.

Covid-19 has undoubtedly had a significant effect on the current economic climate, with many businesses having to make tough calls to reduce working hours, implement redundancies, introduce pay cuts or shut down altogether. Despite this, the “can do” Kiwi attitude can be found in a number of local businesses who are developing innovative new products and services and finding a way to move forward.

Adapting business models

Many businesses have demonstrated their readiness to pivot and adapt in the current climate, while also contributing to the fight against Covid-19. Examples include:

  • When the demand for rental cars began to decline, rental car business Snap Rentals launched a service allowing their staff to perform personal grocery shopping for customers – improving accessibility to essential items for those that may have struggled otherwise.
  • More than 70 businesses registered with ManufacturingNZ for businesses reconfiguring their operations in order to produce face masks and other protective gear.
  • Sheet-metal manufacturing business Metalform, has transformed its factory to produce more than 7000 plastic protective face shields a day.
  • After struggling to source hand sanitiser for their own staff, local brewery Good George produced 1000 litres of hand sanitiser from a distillery that was previously used to make spirits, in a bid to make hand sanitiser more accessible.
  • Fonterra also increased its weekly production of ethanol from 85,000 litres to 250,000 litres to help with the increase in demand for sanitiser.

The ability of a business to ensure their staff remain productive has a positive flow-on effect for the economy and the community. The cash flow generated allows businesses to continue operating until they can return to their previous operating rhythm. Being agile, resilient and adaptable is important to surviving the post Covid-19 economy.   

While some businesses may not be able to pivot and face the difficult decision to close down rather suffer increasing debts, the companies listed above illustrate that by being adaptable businesses can be resilient in these times.

Embracing technology

The Covid-19 pandemic has also reinforced the importance of technology in the workplace.  Accountants, gym instructors, teachers, politicians and lawyers, to name a few, have all been meeting workplace commitments from home. This would not have been possible without adequately investing in technology infrastructure to ensure they were able to operate remotely.  There were a number of businesses not able to immediately switch, as they didn’t have this infrastructure in place, and were left scrambling in the days before Level 4 trying to implement appropriate responses.   Working remotely will likely become the norm to some extent for all businesses.  Being adaptable is key to a successful flexible working environment.

The online marketplace has been growing in recent years, as it’s been a way to reduce operating overheads without the need for a ‘storefront’ to sell products or services. With the impact of Covid-19, we have even seen the likes of farmers’ markets move online in a bid to connect the farmer to the consumer when their platform to sell had been isolated.

It has been encouraging to see the number of businesses and individuals finding ways to pivot and adjust to the new normal, and to help each other. This includes social media influencers plugging small businesses to their followers in a bid to provide exposure for some of the great products and services Kiwi businesses have to offer.  The more we can support local, the faster we can all get back on our feet.

While the last couple of months have been challenging, it has also been an opportunity for businesses to learn and adapt.  It is unclear what our “new normal” will be once Covid-19 passes. However, it is clear that we need to evaluate our readiness and agility in order to utilise the assets and skills we have available to us to respond to whatever the future holds. Covid-19 has taught us some important lessons.

The comments in this article of a general nature and should not be relied on for specific cases. Taxpayers should seek specific advice.

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About Author

Elsa Wrathall

Elsa Wrathall is a PwC senior manager based in the Waikato office. Email: elsa.n.wrathall@pwc.com