Arguably, doing business, as usual, is no longer an option given the financial impact the global health crisis has had on businesses. Since March, owners of enterprises have had to go back to the drawing board to reimagine their strategies in order to pivot and keep the doors open digitally. For women business owners, the impact has been even greater.
According to a recent study by the U.S. Chamber of Commerce, women-owned businesses have been disproportionately impacted by the pandemic. One highlight from the study is, “The number of female business owners who ranked their business’s overall health as ‘somewhat or very good’ fell 13 points during the pandemic, from 60% in January to 47% in July 2020. By contrast, the number of male business owners reporting a ‘good’ business health status only fell five points in the same period (67% to 62%).”
By the numbers, women might have more challenges recovering in the years to come.
Tami Erwin, CEO of Verizon Business, Gabrielle Rabinovitch, Vice President of Investor Relations at PayPal, and Kathryn Chase, Head of US Small Business Banking at Citibank recently joined forces as a part of Verizon’s Women in Business mentorship program to offer sound advice to those looking to reinvent their business during a LinkedIn Live discussion.
To extend the reach of that conversation, each of the leaders responded to a number of questions in efforts to provide women with a guide as they find ways to bounce back in business.
What It Takes To Reinvent A Business
Adaptability is a must within business – and that reigns true now more than ever during the pandemic. What does reinventing ones business look like for small business owners in this day and age?
Tami Erwin: Digital transformation for small businesses went from a nice to have to a must. Before the pandemic, small businesses struggled with scaling, moving to the cloud and ineffective marketing and promotion. In today’s world, if you don’t have a digital front door, you’re out of business. As our customers are reinventing their businesses, we are seeing them invest in technology that enables digital transactions, remote collaboration such as video conferencing tools like Blue Jeans and security.
Gabrielle Rabinovitch: The pandemic has accelerated ecommerce by three to five years, according to some studies. That means it is more important than ever to use technology to drive your business and help level the playing field with larger businesses. Whether that is taking your personal training business and creating a virtual training app or using tools like PayPal to sell online to a much broader base of potential consumers. At PayPal, we’ve seen our small businesses get very creative to manage and thrive through all the change that is happening. We’re actually about to launch a podcast on this very topic, called “Adaptables.” Look out for that!
Kathryn Chase: Many owners, when faced with the shut-down, quickly adjusted their business models. We saw many introduce safety protocols for clients that allowed them to remain open while adhering to CDC guidelines. They provided PPE for employees and required customers to wear masks – and business continued. Some small businesses also created new products to meet demands created by the pandemic. For example, we worked with a Plexiglas display company that quickly pivoted to produce “sneeze protectors” for retail businesses.
Strategy And Adaptability Are Key
What strategies can business owners create to smoothly transform their services and how they operate their business?
Rabinovitch: One of the silver linings of this period has been that we are all going through this together. As a result, I think there is more leeway than ever for business owners to try something new and be transparent with their customers and community that they are experimenting with changes. I think that level of authenticity is important because it brings people along on the journey, helps them root for you and can lead to some really powerful feedback that helps business owners iterate.
We’ve seen some businesses pivot to new business models to stay in business. For example, Student Athlete Coaching and Consulting had to change their business model from training and coaching student athletes to selling memorabilia while providing free virtual coaching sessions. The ability to get creative helped them survive the pandemic and – in some aspects – come out stronger.
Businesses also need to identify new ways to reach their audience. This might be selling on social media or moving beyond one storefront and building a more robust ecosystem where consumers can find them.
Chase: Adaptation is the key. Think outside of the box to modify your products and services. Streamline where possible and ask your customers and employees what changes can be made. Consult with your industry peers to determine best practices, speak with your banker to determine what other small business clients are doing to transform, and do your own research – there is a lot of useful information that you can find online to help spark ideas.
Erwin: A mobile-first strategy should be a priority for small business owners looking to seamlessly transform their businesses. Leveraging tools that enable remote work and providing employees with the same features and functionality as they would have in the office, are crucial for the future of these businesses. We’ve seen greater adoption of these types of solutions during the pandemic from businesses of all sizes.
As funding opportunities continue to present themselves for women in business, how can women prepare themselves to apply for grants, loans, and venture capital? Can you also touch on the importance of being able to discern when it’s time to take advantage of those opportunities?
Rabinovitch: As you prepare to look at funding opportunities, it’s important take stock of your business today, what your ambitions for it are in the future and what type of partner you want to work with. Loans and venture capital both provide funding to your business but have different implications over the long-term. Ultimately, you should evaluate what is available to you and what fits with your long-term vision for the business.
Chase: The best way for women to prepare to apply for grants, loans and venture capital is to organize your ideas and clearly outline a workable business model. As they say, the definition of luck is being prepared when an opportunity arises. Also, consult with a small business banker to understand what can be financed conventionally and what might require investors. The Small Business Administration is offering a variety of options, including the Paycheck Protection Program (PPP) loans and Economic Injury Disaster Loans (EIDL), while the Federal Reserve has offered the Main Street Lending Program. With all of these options, it’s important.
Pandemic-Proof Your Business
As business owners find ways to create pandemic-proof business models, what advice do you have for them as they plan to do business in the future?
Chase: Protect themselves, their employees, and their customers. Plan for the long term and be prepared for opportunity when things return to “normal.” There may also be opportunities now to refinance debt and business mortgages at lower rates or seek loan modifications if applicable.
Rabinovitch: We’re living in a 6-foot-distance world, and many consumers are hoping to eliminate human contact altogether: 87% of shoppers currently prefer stores with self-service options, and contactless payments such as QR codes are becoming more popular. These trends are likely to last, meaning we’ll see effects on in-store payments as well as online. If you were holding out on starting to sell online or upgrade your technology before the pandemic, now is the time to do so. Consumer behavior has shifted and, despite the challenges, it brings a lot of opportunities to reach a broader customer base as well.
Together Everyone Achieves More
What are some of the things that business owners should be mindful of as they reimagine their business – especially as it relates to keeping customers, employees, and partners in mind?
Erwin: Network security is paramount for small businesses as remote work has become the norm. Mobile security, in particular, is a higher priority than ever before. For example, one of the largest vulnerabilities for small businesses is that employees may not be using enterprise-owned devices. This leaves organizations with security vulnerabilities. In fact, 81% of small business executives reported cyberthreats posed a “moderate-to-significant” risk, yet 39% admitted to sacrificing mobile security to “get the job done.”
Reimagining the flexibility of the workplace is key for business owners. Finding balance is the hardest part because while we are working from home, it often feels like we’re living at work. As we all try to get our work done, most of us have increased duties and distractions at home. Women have been specifically hit hardest during this time. In fact, during COVID-19, women spend approximately fifteen hours more on domestic labor per week than men. We need to keep this in mind and try our best to accommodate our customers, employees and partners.
The conversation has been edited and condensed for clarity.