On April 3rd, 2020, the Greater Vancouver Board of Trade – Western Canada’s most influential business association – published grim results based on a survey in which over 1,900 businesses had participated.
These key figures are copied directly from the report:
Nearly one-third are planning to cancel or have had contracts or tenders cancelled, while a quarter will defer or cancel capital projects in the next two weeks.
Among those laying off staff, on average, organizations have laid off 43 employees. As B.C. businesses tend to be skewed to smaller businesses (less than 20 employees), the median or mid-point is much lower, at five employees.
More than 50% of businesses are concerned they will be insolvent or not have the fiscal capacity to restart their business.
Businesses are trying to pivot with 23% increasing efforts towards online, digital, or e-commerce options.
Businesses tend to expect the economic rebound in their market will be slow (55% versus 14% fast) but a sizable group is unsure (31%).
What’s most promising is the 4th metric: 23% of businesses are looking to pivot through efforts related to digital transformation.
Now is the time for creativity. Investments in complimentary digital products, services, platforms and infrastructure will not only help businesses adapt during the remainder of this pandemic; they will create opportunities and growth in the post-COVID-19 economy, which is likely to be more digital than ever before.
There is a lot of bad news right now, and we needn’t become yet another outlet for ominous figures and statistics. Rather, we prefer to (and are nearly hard-wired to) look at the opportunities that businesses have to evolve in this new economy. Businesses that build innovative digital products and services – whether core to their prime business activities or as ancillary services – will exit this pandemic in a stronger position. Also, as Forbes recently pointed out in their Call For Digital Transformation, companies that learn how to efficiently cope with the current social distancing measures will permanently improve their ability to undertake long-distance collaborative work.
There is a sense that many companies have been dragging their feet when it comes to investing in the technological modernization of their operations. COVID-19 has become a powerful motivator to do so.
In the last 30 days, we have seen a surge in activity relating to efforts such as:
- Online education
- Ancillary Real Estate digital services
- Online gaming
- Analytics / AI / data visualization
- Enterprise operations software
In contrast with the above, we have seen a near total collapse of efforts that may not capture the new reality of how individuals and businesses are behaving in the new economy of 2020.
We feel for businesses whose primary activities cannot be made digital. Hospitality, personal care, restaurant and tourism sector businesses, to name a few, rely heavily (or exclusively) on in-person customer experiences.
Now is the time for creativity. We have seen restaurants transform into delivery dining experiences, fitness studios launch online group classes, and established enterprises invest in turning their core operations into SaaS platforms which other businesses may license (such as how AWS was born out of Amazon’s own digital infrastructure). Investments in complimentary digital products, services, platforms and infrastructure will not only help businesses adapt during the remainder of this pandemic; they will create opportunities and growth in the post-COVID-19 economy, which is likely to be more digital than ever before.
Keep your long-term objectives in mind. Do you sell a product or service that could conceivably be delivered or performed remotely? Now’s the time to spin up an e-commerce platform. Does your business use internal systems or processes that may benefit the operations of other businesses? Find a capable development firm and kick off a SaaS development project aimed at creating a platform which you would then license to other businesses (thus creating a separate – and potentially more resilient – business model within your existing organization).
Stay healthy and stay safe. This is only temporary.
Matthew is the CEO and Co-Founder of Convergence. Although his background is in classic Computing Science, these days he focuses primarily on the human-centric world of entrepreneurship.