After a difficult first half of 2020, some companies are now taking the opportunity to reopen and emerge from survival mode. But getting back on track may require some out-of-the-box thinking. Some established companies may want to consider adopting the fail-fast-fail-often ethos championed by start-ups.
Simon and Brogan Carr, founders of Brogan’s Way Distillery, say the ever-changing playing field brought on by COVID-19 means it’s essential to have a ‘never give up’ attitude. It has adopted a start-up mindset to tackle this year’s challenges.
“You must constantly watch, listen and learn how people are changing their behaviours as their reality changes, then respond quickly to align with their emerging needs. As rules keep changing and, with them, customer behaviour we must constantly adapt our business to establish new revenue streams,” says Simon.
“Quickly establishing new parts to our business like the bottle shop, creating short run limited edition products, putting in place new takeaway ordering systems, ramping up our on line sales, keeping staff employed with local deliveries and signing up with home delivery services to expand our reach has helped us navigate this challenging period,” he adds.
Companies looking to grow into recovery mode during an uncertain landscape may want to consider similar principles, such as thinking differently about risk, prioritising speed over perfection and quickly adapting to customer and market changes.
1. Embrace risk like a start-up
Start-up-style agility usually requires an appetite for risk — the exact thing many business leaders are conditioned to avoid. But embracing risk can unlock opportunities for new revenue streams.
Start-ups emphasise speed to market with a minimum viable product — or MVP — and iterate on the first version of the product based on customer feedback. If they fail, they quickly learn what they can and try something else, giving them another chance at success. More established businesses can also do this.
2. Work on a shoestring budget
Frugality is essential in a start-up because they have limited capital to invest. Older businesses can adopt a similar mindset.
Figure out how much capital will be needed until your new product or service turns a profit. Estimate what your sales and expenses will be, and then revise the forecast by cutting sales by half and doubling expenses. This will give a more realistic picture of what may happen.
In addition, keep fixed overheads low and only spend on things that produce revenue. Keep inventory to a minimum and don’t hire staff to deliver the service until there are paying customers.
3. Use the resources you already have (and outsource everything else)
The next step is to match any assets your company currently has such as skills, data, relationships with your customers' needs. Success relies on the execution of a creative idea by the people on your team. All team members need to be very flexible and wear many hats to get the job done.
As the CEO, pretend you're launching a start-up. How should the company be structured? What are the tasks that need to be completed and what types of skills or people are required to complete those tasks?
Once you have that in mind, look at your current staff and determine if anyone matches what you need. If they don't currently exist within your company, you may need to use independent contractors through platforms like Upwork or Freelancer.
“Start-up thinking involves using new approaches to solve existing problems. Start-ups have few resources, so they need to be ingenious about how they deploy those resources,” says Stuart Richardson, founder and managing partner of venture capital business Adventure Partners.
4. Let customer input inform new products and services
What your customers needed earlier this year may not be what they want now. With most customers practicing social distancing, what are they interested in purchasing now that you can provide? Reach out to your existing customers and ask, if you could wave a magic wand and make your life easier, what's one challenge you have right now that you'd love to go away?
When you get your answers, explore what you currently have (or can easily acquire) that can provide customers with what they need.
5. Network to build connections
Networking is everything. And it should be for established businesses, too.
The reason start-ups see networking as such a critical activity is that they never know which connection they make will lead them to a new customer opportunity or resource. Established companies need to pursue all networking opportunities even if they do not seem directly related to what they are trying to accomplish right now.
It’s easy to have a start-up mindset in a more established business. All it takes is practice and commitment and your business will be as nimble as a growing early-stage venture.