2020. The coronacoaster on which we all sat, with barely a safety buckle between us, witnessing furloughs, redundancies and the highest rate of unemployment since 2016. And yet also some 85,000 new businesses bravely launching into an uncharted landscape and an inspiring amount of innovative approaches to staying financially afloat during the ‘new normal’.
While many have faltered through no fault of their own, others have flourished – well, bloomed at least – and managed to keep their heads above water through what can only be deemed pretty damn fine improvisation. What a ride. The key business trends forced upon us by 2020 were the ability to adapt and sheer resilience, which, in many cases worked a treat and so are sure to stick around this year.
Here are our predictions on what business trends will rise from 2020’s ashes, helping us build a far more stable 2021.
Cashflow is everything
Getting to grips with cashflow shot right to the top of every determined business’s to-do list in 2020 and will remain just as critical throughout 2021, which will be a year of gradual recovery at best. A cashflow forecast plots anticipated income and expenses on a timeline to show when money most likely to be short and it is this ability to see around corners that saved the bacon of many companies on a week-to-week basis throughout most of 2020.
You can be the most popular business on the block and outwardly look incredibly successful, but if you’re not in control of your cashflow (a standard time period for cashflow projection is 12 months, FYI, but you should work on it at least once a week) you are at risk of losing everything at any given moment.
It’s make or break stuff, so if your cashflow forecast tells you that you don’t quite have enough money to reinstate that member of staff, wait until the picture looks brighter. Don’t have a cashflow forecast? Create one; get a template online or get help from a bookkeeper or accountant.
Saving for a rainy day
After what can only be called a shitshow of a year, it’s hardly likely anyone – let alone any business owner – was sat, or is still sat, on a comfortable cushion of ‘just in case’ cash. It’s actually quite tricky for some business owners to behave in such a way even if they can, with many preferring to plough profit straight back into the company coffers for marketing, investment or expansion plans. That said, if ever there were a business buzzword we can take from 2020 it’s ‘contingency’, which for many has meant the difference between sink or swim throughout such troubling times.
What this has done though is drum in (repeatedly, to the point where most of us have felt that we’ve finally gone quite, quite mad) how important it is to have a rainy day fund. Precisely how big that fund should be entirely depends on both your business and your industry but with companies using their available cash throughout the pandemic to overhaul their operations strategies, take sales online and invest in appropriate health and safety measures to keep staff safe and productive, it’s definitely best to aim for a fund that spreads out over months not weeks.
The rise and rise of remote working
For lots of people, the thought of remote working sends shivers down their spine – it’s a glib vision of routines going to pot, loneliness, crap lunches and not knowing who to turn to when the milk’s run out. Worry ye not though unbelievers, thanks to the rapid development of modern tech, working environments are shifting in terms of structure and accelerating with regard to productivity faster than ever before, not least thanks to 2020 putting the kibosh on any office bants for the foreseeable…
Even before Covid, in the heady days of 2019 (when we all had the cheek to think things were occasionally crap. Imagine?!) statistics showed that the number of companies with remote workforces was already on an upward surge with 16% being fully remote and a whopping 66% giving the green light to remote working for employees that requested it, but now it’s really found its feet.
The ability to work effectively and happily from home started as a bright idea, the insanity of 2020 proved it was possible and the rise of cloud computing has shown that almost everything can be run online with minimal clutter including scheduling, customer service, marketing, project and inventory management, office tasks and spreadsheets, and, crucially finance and real-time accounting which underpins the whole lot.
In early 2020, around 50% of businesses said they planned to move IT to cloud computing – an 18% rise from just one year earlier, so imagine how high that figure is now; our productivity hasn’t been tied to the traditional workplace for some time and 2021 is set to cement that.
Online sales take centre stage
E-commerce has been a thing since the days of the dotcom millionaire, a group of savvy entrepreneurs who rode the first wave of internet start-ups all the way to the bank in the late 90s only to have the house of cards come crashing down in the early naughties…along with the stock market. Effectively, it was a thing and then it was thing that many business owners didn’t have a huge need for and then, boom, we all got stuck at home thanks to Covid and selling online is having more than a moment. In fact, during lockdown (we’re talking lockdown 1.0; cast your minds back to March 2020 when we all thought we’d be free as birds by now) between 55% and 60% of consumer spend happened online (online retail increased by 52.2% in December alone), businesses said online sales accounted for 12% more revenue than normal, and more than 25% of businesses employed online marketing as their main strategy for getting through the year.
Although e-commerce was evidently a brilliant way both for business owners to try and keep roofs over their employees’ heads and for customers to continue to shop safely, all the signs point to this exponential growth to carry on throughout 2021 and beyond; online shopping is convenient and more user-friendly than ever so it may prove a hard habit to drop.
Business continuity planners finally get their moment
Once considered the far-out stuff of the tinfoil hat brigade, the phrase ‘business continuity plan’ is now a buzzword for business owners who have their shit together. In fact, Google searches for ‘business continuity plans’ leapt up by 600% during 2020 and Google themselves have a dedicated team of ‘reliability engineers’ who run a simulated ‘war’ on the company’s infrastructure annually. Known as DiRT – disaster recovery testing – it involves everything from causing multi-floor flooding to staging angry mobs and placing hackers in the system to steal data; whatever it takes to bring down the infrastructure.
The data centre attacks aren’t real, but they’re tricky to distinguish from an actual event and are a sure-fire (if a little extreme) way to expose weaknesses and make sure that incident managers are up to the job. Doing exactly what it says on the tin, a business continuity plan is a set of strategies that you prepare prior to a major disruption – a fire, natural disaster, recession, loss of a major contract, or you know, a pandemic that’s more than overstayed its welcome – to help you power through calmly and come out of the other side as unscathed as possible.
Which all sounds a little bit heavy, but doesn’t need to be – while we wouldn’t suggest you go all out Google and start causing havoc willy nilly, a good starting point is to download a template and work your way through it. Not only will this help you spot things that can easily be missed in the middle of a crisis, it will also empower staff to work through the process as opposed to panic if, say, aliens ever land and demand that we take them to our leaders, which frankly seems perfectly feasible these days.