By Amy Collett
Would-be entrepreneurs put their business plans on hold when the coronavirus pandemic hit. Now, over a year later, they’re searching for the best way forward in an economy that’s forever changed.
There’s no question that business looks different after the COVID-19 pandemic. Even with assistance funds, many small businesses have closed for good. Among those that remain, lean staffing, shortened hours, and reduced revenue are commonplace.
Yet while some businesses struggle, others are emerging from the ashes of the pandemic: 2020 saw more new business applications than ever before, GlobeNewsWire reports, and business applications continue to rise in 2021. Not only has the pandemic created new problems for creative entrepreneurs to solve, but the digital economy is also making business ownership more accessible than ever — including when we’re stuck at home.
What distinguishes the businesses thriving in the post-pandemic economy from those barely getting by? They’ve adapted. From rethinking the office to new tools for collaboration and communication, here are the ways successful entrepreneurs are adapting business models to the post-pandemic economy.
1. Taking advantage of cheap money
Business loans are hard to get as a startup with no track record. However, low-interest rates have increased the appeal of self-funding sources like home equity. A cash-out refinance, for example, lets homeowners withdraw equity to finance a business and get a new mortgage at today’s low rates.
2. Hiring remotely
That’s not to say saving money isn’t a priority. Startups are reducing costs and expanding their talent pool with remote hiring. However, hiring across state lines introduces new complexities, particularly when it comes to payroll. Because taxes and labor laws vary by state — and workers must be paid according to the state where they reside — it’s critical to set up payroll for your growing startup before hiring its first employee. This includes determining the correct withholding and pay frequency for each employee, as well as staying on top of tax obligations and keeping accurate records. Businesses that fail to establish an efficient payroll system risk IRS fines and dissatisfied employees, both of which can be disastrous for a growing startup.
3. Investing in automation
Automation isn’t just for big business anymore. To deal with talent shortages and the rising price of labor, businesses of all sizes are investing in technology that frees up time without tying up funds. Business automation for small businesses includes software that eliminates repetitive tasks — think bookkeeping, inventory, and document management — and tools like customer relationship management software and chatbots that optimize the customer experience.
4. Changing distribution methods
Finally, successful businesses are adapting to new shopping habits developed over the pandemic. Consumers have grown used to buying everything from groceries to therapy online. Businesses that continue to treat e-commerce as optional are likely to lose customers to brands that deliver on convenience. Even brick-and-mortar businesses are embracing this shift in consumer behavior with virtual services, in-store pickup, and same-day local delivery.
It’s time to stop waiting for things to return to “business as usual.” For entrepreneurs to move forward after COVID-19, they need to adapt to the myriad changes brought by the pandemic. While this presents a hurdle for new entrepreneurs, it’s a time of great opportunity for those up to the challenge.