What Small Businesses Do to Cope with COVID-19 May Save Them in a Recession

As I watched business after business close as the COVID-19 pandemic took hold in the Boston area, where I live, and eventually nationwide, I had a sick feeling in my stomach for all the businesses forced to sit out of an undetermined amount of revenue--all while their operating expenses continued. 

But within days, many of these scrappy small businesses had developed amazing Plan B’s. And I believe these alternate offerings and the audience engagement these companies are pouring their time into during this unprecedented business closure will set them up for success during a recession, which is most certainly coming once business returns to “usual.”

Let’s start with a few examples. We’ve all heard of the calls on people to support their favorite restaurants with gift cards, but I’ve also been amazed at the restaurants getting creative with their offerings, doing quick pivots to serve family-style or freezer-friendly meals in order to keep their doors open and to serve families in a way that works for them while stuck at home.

Local fitness studios, art studios, and children’s enrichment programs have live-streamed workouts and classes over Facebook and Zoom--a perfect solution for parents stuck at home for weeks (months?) and trying to entertain kids or stay in shape. Some places are charging a reduced fee while others are offering them up free as a way to stay engaged. Many of the local crafting studios are offering take-home or delivered kits for kids or adults.

A food tour that is obviously closed down is providing socially distanced Easter Bunny visits, complete with chocolate from local shops. 

Even my salon, known for their coloring services, is getting into the game. They’re creating custom color kits for clients, with everything they need to maintain their color while the salon is closed--even Facetime support.

What’s interesting about this time is that everyone is in this position. This isn’t a situation where your business is closed due to say, a flood or fire, and customers need to find a new place to get the service. We’re all in the same boat. So your customer base is yours to lose--or to gain, as it were.

Engage the hell out of your audience

You have millions of people sitting at home with nothing to do. Has America ever been more captive? There’s only so much Netflix you can watch. And your audience, if you’re local, can be expanded by Zoom or Facebook Lives to include anyone in the country.

As a business with downtime, this is the time to work on that online presence and also to try to fill the space that you typically occupy for your clients in a new way, if you can. If you’ve generated that loyalty over time, it’s not just your product or service that will be missed--it’s you and your staff and how you make the customer feel. Think about fostering that connection with loyal customers as well as new people who may have the time to learn more about you.

Examples of great ways to do this include live streaming classes, creating reduced-fee memberships (this is great for something like a kids’ music class, for example) or generating resources that your customers can use to recreate the joy or service they get from you in their own homes.

New product offerings that can offset a potential recession

The businesses who are doing this best, to me, are those who are coming up with new product offerings, like the salon I mentioned with the custom color kits, or the craft studios with DIY crafting kits. Fitness studios who are getting up and running with live-streamed workouts are potentially generating a completely new income stream for themselves.

Maybe this isn’t what you got into business to do, but necessity is, as they say, the mother of invention and that’s never been more true than it is now. Creating options that can be accessed virtually opens up your potential audience beyond your local demographic. Creating lower-cost offerings that people can take and DIY brings a whole new product to your business.

These are the things that could very well save us in a recession. Having another way to generate revenue if some people can no longer afford what you do, or being able to expand your audience both geographically and income-wise can make up for typical recession losses.

I look forward to seeing how the innovations businesses are pouring their time and effort into now translate to a cushion of new offerings for them that may save them in a recession.