There’s been a lot of talk about a ‘new normal’ after the pandemic of 2020 and 2021. There’s no denying that we’ve experienced long months of everything being far from normal. Swathes of staff have been on furlough, bustling hospitality venues have been shuttered and silent, and it’s become common practice to attend meetings only half dressed (the top half).
It’s too early to be sure whether so much that is different will remain that way. Millions of people have discovered the benefits (and disadvantages) of working from home. Many have now become regular online shoppers. Simple social rituals, such as blowing out candles on a birthday cake, may be gone forever.
The established patterns of life and work have been disrupted and it’s too early to tell what the longer-term impact of these will be. This makes it difficult for many businesses to plan because they can’t predict how their customers will behave in the future.
In the midst of all these uncertainties, there are some immovable truths that won’t change. It’s important not to lose sight of these fundamentals.
1. Cash is still king
While the pandemic may have hastened the demise of notes and coins as a way of making payment, it hasn’t changed the truth that cash is still king - even if it’s now mostly digital money.
The growth or failure of your business will still be determined largely by how much working capital it has. You’ll still face the regular cashflow crunch of payroll and tax bills. Slow paying customers will still hold onto funds longer than you want them to.
As the recovery gathers momentum, competitive advantage will sit with businesses with access to cash - either from their reserves or through finance mechanisms such as loans, asset finance and invoice factoring.
2. Marketing is still essential for success
Periods of major crisis, such as the pandemic, can make it easier for businesses to grow their market share by being bold with their marketing. Because their competitors cut promotional budgets and even shrink their marketing teams, the cost of growth is reduced, giving a double win - more customers for a lower price.
The end of lockdown has seen a surge in marketing jobs being advertised across many industries. Companies are reinvesting in the creative teams that power their growth engines, and budgets for advertising and market research are being reinflated.
While the advantage sat with firms that held their nerve and had the funds to keep their marketing teams alive, that position is shifting. New teams, full of keen new hires, bring a burst of new creative energy that can make a real difference. There’s an opportunity for businesses that put serious money into reviving their marketing.
3. People are still your most valuable asset
Digital solutions have shone during the pandemic. Digital payments, digital ordering and digital meetings have become the standard for many people and businesses. Many of us have started using digital tools that we lived comfortably without before March 2020.
But digital doesn’t replace people. Even when we start to see robots and artificial intelligence in the workplace, we’ll still need people in our businesses. The payroll will still be one of the largest expense items on the profit and loss, reflecting the investment in employees.
Successful businesses recognise the value of their staff and put money into training and developing them. The cost of hiring will remain high, meaning it’s more efficient to retain talent that’s already in the business, wherever appropriate.
4. It will still go wrong sometimes
Some of the most powerful lessons learned by business owners have come from their mistakes, or when something outside their control has gone wrong. This isn’t going to change in the ‘new normal’ after the pandemic.
Arguably, there’s more scope for making mistakes and misjudgements now, as businesses adapt to new patterns of working and living. This underlines the importance of having a secure cashflow plan in place, because mistakes typically involve losing money.
Whether it’s unanticipated costs or a loss of income, unexpected problems often lead to cashflow pressures. If there’s not a strong cashflow plan in place, backed by finance measures for raising funds at short notice, these pressures can damage the business.
5. Growth is still the sign of a healthy business
Walk into the premises of a healthy business and you can immediately feel the energy, enthusiasm and commitment. Whether it’s a new business or been around for a while, it’s still moving forward. Even when sales aren’t going up, it’s got its eye on the future, exploring new markets and new opportunities.
Healthy, growing businesses succeed because they’re led by people who understand that growth demands investment. They put processes in place to ensure funds are available for new projects while ensuring that day-to-day finances are kept under control.
They also assess opportunities when they present themselves. During the pandemic they took maximum advantage of the financial support provided and they’ll now be looking hard at the Recovery Loan Scheme, to determine if it’s right for them.
Helping businesses raise finance for the post-pandemic recovery
We help businesses secure the funds they need to grow. We can help you determine what funding is appropriate for your business - such as the Recovery Loan Scheme, invoice finance or another financial solution.
If you need funds to help your business succeed in the ‘new normal’ that’s here, get in touch and one of our team will be happy to discuss your requirements. The sooner we speak, the sooner you could be moving forwards. Give us a call today.