Sean Toomer, AKA Mr Small Business, is the owner, founder, and MD of Diverso Accountants, a uniquely innovative company working exclusively with small businesses and start-ups. Diverso provides not only accounting, but an extensive package of free business support and advice, all included in a monthly subscription fee –helping clients manage cash-flow. Here he discusses how to make money in the second lockdown:
Months on from the first national lockdown, just as businesses were beginning to find their feet again, we are once again in a national lockdown. You’d be forgiven for throwing up your hands in despair – but don’t. If you’ve managed to navigate 2020 so far, with a bit of creativity and by calling in customer support, you can get through this too.
So what now?
The first time around we saw many businesses display incredible agility and innovation, with some pivoting their approach virtually overnight to suit the new demands of a COVID world. This time around though, adapting isn’t enough – now is the time for small businesses to be really creative about how they make money, and to call in some of that goodwill they have built up with their customers. That is especially important in the case of ‘high risk’ sectors such as health and beauty, personal services, and hospitality, who will be among those taking the biggest hit.
Small businesses, as we have seen, are the heroes of the economy. They have done some amazing things this year – from supporting vulnerable people in their communities during the first lockdown, to stepping up to provide summer holiday meals for vulnerable schoolchildren when the government refused to do so. So, I believe lockdown 2.0 is the time for them to draw down on some of that goodwill and loyalty they have banked over years.
Calling in customers’ loyalty
I work exclusively with small and micro-businesses, and I have seen them come up with some creative ways to make money and ‘fill the gap’ until more normal trading conditions resume.
We had a hair salon that sold discounted vouchers for appointments later in the year to keep the cash coming in while they were closed – crucially having kept up engagement with clients by providing free online hair tutorial videos throughout lockdown.
Similarly, a beauty therapist set up a VIP club and sold treatments for a later date at a discounted rate – effectively going to some of her best customers and providing a means for them to help her business survive.
Small businesses build up strong relationships with customers who value and rely on them – and having seen so many high street casualties this year, customers also have a real understanding of the pressures businesses are under. Businesses mustn’t be afraid to ask for their customers’ support when they need it. My slogan for these times is: “Buy local; Protect small businesses; Save livelihoods.” I hope it catches on!
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Getting creative
While many small business owners were able to shift and adapt to survive the first lockdown earlier this year, this second had them wondering if they could do it all again. The good news is this lockdown should, we hope, only last a month and schools will remain open. Businesses will have learned a lot from the experience last time around, so it shouldn’t hit them as hard.
And with the return of furlough covering the majority of staffing costs, and small business grants coming back, they can focus on creative ways to fill the gap from lost revenue. One pretty quirky example can be taken from one of our clients who work in television production and started selling ice creams from a boat called the Lolly Roger in the River Hamble this summer– it was a huge success. It’s the kind of idea that you might come up with, but never have the time or the need to pursue – until now. That’s what businesses need to be thinking of.
Another good example is a networking group we know which went entirely online, and it actually sped up their expansion plans, bringing in businesses from the rest of the UK, well beyond their local area. Doing things differently, even if it’s the pandemic that forces your hand, might be the best decision you ever make for your business.
It’s a cliché – but true nonetheless: necessity is the mother of invention, and our brilliant, creative small businesses, who know their communities and their customers better than anyone, are just people to rise to get inventive and make it work for them.
I believe small businesses can come out of this and come out stronger. But adapting isn’t enough – creativity and customer relationships are key. We have helped many clients come up with creative ways of making money and minimising tax, so if you could use our help, get in touch with Diverso Accountants now.
