Facing up to the challenge of covid-19

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No sector or area of business has not been affected by the coronavirus crisis and lockdown restrictions.

But where some have floundered, others have succeeded as they adapt their practices and offer to target customers in new and innovative ways.

BusinessLive publisher Reach plc has joined forces with our sponsor NatWest to run a series of online roundtables, bringing together senior figures from the bank with Midlands business leaders to examine how the lockdown has impacted the region.

Our panel

– Mark Harrison, partner of Mark J Rees Chartered Accountants

– Alistair Houghton, editor of BusinessLive and panel chairman

– Catherine Johnson, managing director of Embroidery Design Solutions

– Qasim Majid, chief executive of Wow Group and president of Asian Business Chamber of Commerce

– John Maude, Midlands and East of England managing director for Natwest Business Banking

– Marc Reeves, editor-in-chief of Reach Midlands

– Mehul Somani, owner of Oadby Building Plastics

The panel were asked what impact they had seen as a result of the coronavirus pandemic and subsequent lockdown in their sectors and among their clients and what challenges had been faced and overcome.

John Maude leads NatWest’s business banking operation in the Midlands and East of England and looks after SMEs with turnovers up to around £3 million.

He told the panel every business and sector had been impacted very differently.

“We’ve looked to support every customer individually where we can and using different funding schemes through the Government as well as our own,” he said.

“We’ve had to look at that very differently for each business. The main challenge has been the uncertainty that goes with it moving forward such as how lockdown will continue and what will happen next.

“That has been a continual theme I’ve heard from speaking to my team and customers as well.

“The agility of the SMEs has been remarkable as people have found new business models and new opportunities.

“It shows the spirit of the entrepreneurs we have. We saw a spike in demand initially from customers asking what we could do to support but it has tailed off a little bit but I can actually see that demand coming back.

“As and when businesses start to reopen, they will begin thinking about what the other opportunities there are and what support we can give them.”

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Marc Reeves is editor-in-chief for the Midlands region at BusinessLive publisher Reach plc.

He said that, as the lockdown process moved from the initial stringent phase to something a little more relaxed, it was the uncertainty caused by these changes which was underpinning businesses’ decisions.

“It’s all about timing and the interdependency of the different sectors,” he told the panel.

“We see it in as much as most of our revenue comes from the marketing budgets of retailers, large organisations and national bodies so we have certainly felt the pain. When is confidence going to return to a point when enough businesses are opening up their marketing budgets again?

“This will then have a knock-on effect for our decisions and also applies to all businesses. What do their customers want? What position are their suppliers in?

“Key is making sure the timing of your decisions reads what those partners are doing as well because getting it wrong could be really damaging as we enter these next phases when more uncertainty is coming.”

Mehul Somani is the owner of Oadby Building Plastics which supplies products to both corporates and small trade operators in the construction sector.

He said the firm shut down for three weeks when the lockdown initially started but soon made the decision to reopen.

“Our customer base is made up of a variety of clients from large homebuilding groups to the one-man-band builder and it’s this second group that has been affected hugely,” he said.

“They have been missed out of certain government schemes so unfortunately their income is based purely on what work they can do.

“We thought no-one would be doing anything but it’s actually the opposite. We had a huge influx of emails asking us to open up so decided three weeks after lockdown to operate a click-and-collect system with no customer contact.

“The domestic side of the market has gone through the roof as people are sitting at home in the gardens, evidently bored, and this has seen our DIY revenue climb from ten per cent to around 38 per cent.

“But we know that is a false economy as the bigger contracts have been cancelled and taken a huge impact and we don’t know what is going to happen there. For us, it’s been a strange journey and we don’t know what to make of it.”

West Midlands coronavirus news

Catherine Johnson is managing director of Embroidery Design Solutions which supplies specialist embroidery products to automotive firms, fashion brands and the medical sector.

She explained that her company had been faced with different challenges depending on which sector it was supplying to.

“The challenge we had with the medical sector was that development work continued to come through,” she said.

“We support one particular company and our work is crucial for them so stopping that in the middle of this crisis would not have been very constructive. The medical supply chain as this completely dried up and essential supplies were, quite rightly, needed for urgent medical use.

“With automotive, our production has come to a complete stop so we closed our facility but all the manufacturers closed and they are not really looking to reopen anything significant until August.

“Because we are a small business, we can respond a little more quickly and flexibly in providing them with products that need to get to the factory floor.

“What we have found with fashion is we’ve been able to repatriate some goods back to the UK although we haven’t been able to manufacture anything until the past couple of weeks.

“Where we have found sales to be different is through brands such as British independents which have been very creative with their marketing by running quizzes and discos.

“Our business model moving forward will change and we’ve taken this time during lockdown to develop that strategy.”

Qasim Majid is chief executive of digital commerce group Wow and president of Asian Business Chamber of Commerce.

His company operates four different brands, one of which looks after e-commerce assets of multinationals and SMEs.

“We have seen a huge increase, particularly in the B2C sector across many different types of organisations and businesses,” he said.

“We have looked at some of the stats showing changes over the past eight weeks and the biggest one of all has been home groceries which has grown by over 350 per cent. The next sector is home and DIY so some of our customers that have been supplying DIY products have seen increases of over 200 per cent.

“One of our brands looks after the leisure and hospitality industry and they’ve seen huge drop offs in terms of traffic to their websites.

“We hear the word ‘pivoting’ a lot and the independent restaurants and small chains have moved to takeaway. They are not seeing covers in their restaurants because of lockdown but are seeing a huge increase in online ordering.

“Another of our brands looks after IT support so we saw a huge increase in helping people set up home working. Overall, it’s been good for us as a business and our clients.

“I truly believe SMEs that can be agile and innovative are going to be part of this recovery process.”

Mark Harrison is a partner of Mark J Rees Chartered Accountants who predicted a “massive change” in how his company and others would work in the future.

“We have found it a challenge but the clients we act for are predominantly SMEs and we’ve seen some areas work very well and others come to a grinding halt,” he said.

“SMEs drive a lot of the economy and we need them back on their feet as soon as possible. We’ve seen in every different industry the ingenuity of some of our clients to adapt what they were doing before, whether that be new products lines or services.

“They are the ones trying to get through this as quickly as possible. When the Government first started its 5pm daily briefings, the phone would ring for hours as every client wanted to know how this would impact them.

“Thankfully, that panic mode died quite quickly among our client base. SMEs are not necessarily talking doom and gloom, even those in the leisure sector which have had complete lock down and we have quite a few clients in that area.

“They are all doing deliveries and collection services and are preparing for opening up with social distancing. They are thinking on their feet and trying to get something out to customers as soon as possible.”


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