The sweeping changes to the business landscape as a result of COVID-19 have pushed businesses to pivot their offerings. In attempting to adjust to this new reality of doing business, Fluence Capital outlines 5 rules or best practices for pivoting in a crisis:

1.Understand your current financial situation

Taking advantage of a new opportunity can mean spending money upfront. Before you can make any significant changes, you need to conduct an assessment  of your current working capital requirements. Understand how much cash you’ll need and for how long to meet current overhead expenses. You may need to actively engage with your financial service providers to assess if lines of credit are available to you, as well as explore additional options should you need them.

2. Relook at your fixed  costs

When pivoting your operation, you should try and remain as lean as possible. Examine ways to reduce your cash flow output by pausing all non-essential spending, implementing a hiring freeze and placing restrictions on discretionary spending within the business. 

3. Put systems in place

You’ve made the decision to pivot, but now what? Getting what essentially is an entirely new business off the ground means you need to ensure you have systems in place to manage the new business and associated costs effectively.

4. Implement cash flow solutions

Once you have a stronger understanding of what your business will need, prepare  a budget and cash flow forecasts, and implement cash flow management solutions to address your most urgent issues. 

5. Focus on digital

If the COVID-19 crisis has taught us anything, it’s that businesses who are digitally focused will be far better equipped for the post pandemic business landscape. Assess how you can digitize your offering to meet changing customer needs. 

6. Strengthen your supply chain

Supply chains, large and small, have been significantly disrupted by the crisis. If you have pivoted to a new offering, act quickly to strengthen your supply chain in order minimize the short and long-term impact on your operations. This will involve reviewing your current suppliers to see whether they can still assist you with your new service offering requirements. 

Conclusion

While pivoting is not a new concept, it has certainly become far more prolific in recent months as businesses attempt to shift their offerings to what people need today. In the current highly unpredictable and fast changing business environment, businesses need to view the crisis as an opportunity and examine ways they can best serve the changing needs of their customers. Those businesses who adopt an agile and adaptable approach, and think on their feet, will emerge from the crisis stronger.