Businesses may pivot out of opportunity or a need to survive. We asked business leaders who have successfully made the leap what it takes to pivot their small businesses successfully – and what hindsight has taught them.
After a decade in business, florist Claire Sawyers had grown to three stores in Auckland and an online presence. But she came to realise that operations were less efficient, and more expensive, than they could be.
That ultimately led to her downsizing and repositioning Roses Are Red as a purely online business.
Meanwhile, New Zealand marketplace TheMarket launched in July 2019 with a strong focus on consumer goods, including homewares, fashion and lifestyle products.
But the stage 4 Covid–19 lockdown forced it to bring forward existing plans to expand its presence in essential grocery – a pivot implemented in just four days, explains Sarah Gunn, its general manager of trading.
Look for efficiencies
A business pivot will often involve some up-front establishment costs. However, it also presents an opportunity to deliver efficiencies.
Despite initially costing one-third of her revenue, pivoting online allowed Sawyers to not only slash costs and reduce headcount, but to cut her opening hours.
Customer loyalty isn’t guaranteed
Just because you’re renowned for a particular service or product doesn’t mean that the same customer loyalty will automatically transfer when you make a pivot.
“Being trusted in a category we weren’t originally known for was a challenge,” Gunn says.
We partnered with reputable companies such as Foodbox and gained the support of the community by offering frontline workers a 15% discount on groceries.
Get the right expertise
Both agree that having the right people and skills are crucial to making a success of any pivot.
“One of the things that really helped us act quickly was developing a Covid-response cross-functional team to develop and implement our strategy to not only survive, but to thrive at a time where ecommerce was a key opportunity,” says Gunn.
For Sawyers, the crucial component has been finding web support relevant to her business and industry.
“There are many people out there who will build you a website, and it’s very easy to spend a lot of money on something that’s not going to do the transactions for you,” she explains.
“So, find someone specialised in creating the type of thing you do.”
The blog was provided by Prospa, New Zealand’s small business lending specialist. Visit prospa.co.nz for more information.
