Under house arrest – week 3
So, two weeks under the belt, not sure how many more to go but likely to be at least another 3 weeks, probably more…
If you’re anything like me, then you have managed to stay sane, but probably have eaten a little too much and have been drinking a little more frequently, whilst making sure to go out once a day to get some exercise. On all accounts, you will have settled into a new routine albeit one that may not necessarily agree with your other half…
Spending more time in solitude and given the new economic circumstances, I have had more time to reflect and here are some of my thoughts and observations:
As a retail business for non-essential products or services, so with stores firmly in lockdown, do you keep your online business open (technical and commercial colleagues can work from home, however anyone in logistics or distribution is potentially exposed) or do you shut everything?
- Shutting down from a health and safety perspective will probably be welcomed, however will staff be happy to be furloughed?
- Will your customers understand your decision?
- Are your competitors following suit? If not, will you lose your customers in the long run?
- Do you make this a PR opportunity (be that for staying open or shut down) or would that be too callous?
Not knowing how long businesses will have to be closed it would be difficult not to furlough at least some of the workforce. Not doing so would have a huge financial impact on the business, yet doing so will have a huge impact on those who earn more than £3125 per month, whose pay cut will increase beyond 20% the more they earn. Equally, those on much lower wages probably cannot afford a 20% cut, as they may already struggle to make ends meet.
- So, does the business pay 100% of salaries and claim 80% (with a maximum of £2500 per month) back from the government? The financial impact is impossible to calculate as we do not know how long before we return to business as usual.
- Whichever way you turn, people will be out of pocket, if not by means of a reduced salary, then by a diminished future bonus, reduced performance of share save schemes or cancelled dividend payments. By my reckoning, this must have a huge impact on consumer spending once we’re back to normal, therefore this whole situation will have a prolonged impact on the retail sector.
Whilst on the subject of furloughing staff, for a small business (and we’re no exception) we are grateful for the government to give us some support. That said, even though I understand all the reasons for it, it is disheartening that it is unlikely that we’ll see any money before June, as apparently it won’t be until at least the end of April (maybe later) before there will be a mechanism to claim for support.
We have seen a few companies making a valiant effort to make the best out of a bad situation (think Leon selling groceries and ready meals, the Body Shop delivering care packages to local hospitals and H&M using their supply chain to manufacture face masks), however we have seen small, local businesses really stepping up to the plate, changing their business model almost overnight. Locally to me, we have seen two small delicatessen taking their business online, where they only had a low-key presence previously, now selling groceries and complete meal plans delivered to your door the next day. I have also witnessed my wife, who runs a small business that delivers ante-natal and first aid classes, re-write her lesson plans and she now delivers highly personalised classes via Zoom, with the result that clients sign up from well-beyond her usual catchment area (one from the States!).
There are two points to make here
- Some of us will see opportunities for our businesses in this misery and
- I actually think that once we’re on the other side our sense of normal will have changed.
Which brings me nicely to the next point. Is anyone else making themselves paranoid by wondering what the competition is doing? What are they thinking of? Am, I missing a trick? Should I be doing more? But, in these times, who wants to talk about recruitment? Should I run a forum for candidates looking for the next opportunity? Should I run a forum for business leaders? Answers on a post card please.
And finally, what are your thoughts on those who are choosing this time to start playing the stock market via FTSE tracker funds? Is this clever entrepeneurship? Making hay whilst the sun shines? Or, insensitive ‘$%&@’s for making money out of someone else’s misfortune? Looking forward to receiving your comments…
Wishing you all well. May you stay safe, healthy and sane!