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The COVID-19 pandemic is a major challenge, with consequences for the health of citizens, the health system and the country’s economy. The last few months have been very difficult for most businesses in the country and our analysts are preparing for an even more difficult winter. So what does the entrepreneur have to do to survive? The primary thing is not to give in to panic and misinformation. As in any crisis, changes in the market pose many risks, but they can also create new business opportunities and push businesses towards innovation. The aim is to have a cool diagnosis of the changes that take place in each business sector, but also of the situation that prevails in each business.
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Every business decision, under any circumstances, must follow a structured thought process:
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- First, it is necessary to record our facts.
- Second, we need to set our short-term, medium-term and long-term goal.
- Third, we need to analyze the costs and expected benefits of a decision.
- Finally, we are called to take into account all the above, in combination with our experience and instinct, in order to make the business decision, and take the risk.
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What are the facts?
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In terms of the market environment, the ever-changing measures to limit the spread of Covid do not allow for any forecast in the short to long term and – possibly – in the medium term. Apparently, at least until the spring of 2021 this will not change. The fact that we move in uncharted waters and every decision we make has a very high degree of risk is our first fact.
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In the long run, it is possible to make a prediction with enough certainty: the need that is currently dramatically increasing the shares of digital market, is sure to change some people’s consumer behavior and create new sales channels for businesses. The increase in digital sales, to a certain extent, has come to stay. This, quite certainly, can be considered as our second fact.
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The third fact is that creating digital channels for a business requires study, time and capital. It is a mistake to think that we will create a cheap website without preparation and we will have results without supporting it with the appropriate marketing.
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However, in order to complete the delineation of the current situation, it is not possible to avoid analyzing the facts of our company. Among other things, we must specifically answer the following questions:
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- 1. If we take the worst case scenario in terms of measures as a basis, then for how long will our current liquidity last?
- 2. How feasible is it for the market in which we operate in, to work digitally?
- 3. If we invest directly in our digital transformation, for how long can we operate at a loss?
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What is our goal?
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Out of the affected industries, some companies are currently struggling to survive. Others are trying to seize a temporary chance and make a significant profit today, without looking too far into tomorrow. Finally, there are some who realize the inevitable shift of the market to digital channels and decide to invest today in order to benefit in the future. The definition of the goal is directly related to the sector in which each company operates, to its liquidity and to the temperament of the entrepreneur himself.
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How much does it cost to create digital channels for a business and what are the expected benefits?
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The attempt to create a digital sales channel, without prior study, is doomed to fail. The more extensive the study, the greater the chances of success. Only market research can tell us the way, the cost and the strategy with which we can invest successfully, but it will also determine the expected benefits based on real data.
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This obviously takes time and money. And, in fact, we have to keep in mind that turning to the digital world is not always profitable. Some industries do not have a digital marketplace and others are already saturated. There will be cases where the conclusion of a study will be that we should not change our operating model.
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Conclusion
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The times we live in are not conducive to business decisions. Instead, they are designed to be ready for implementation as soon as light appears at the end of the tunnel. The market turmoil due to Covid does not allow erratic and adventurous movements. If we can, we are not changing anything today. We simply apply – as the case may be – mild or extreme tactics that will extend the life of our business.
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The aim is to have the time to study how we will transform our business with prudence and patience , for it to respond and thrive in the new era.
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Finally, each entrepreneur must determine the point in time at which he will implement his plan. On the one hand, the closer we get to the end of the pandemic, the lower the uncertainty and risk. On the other hand, the ones who survive in nature are the most flexible and adaptable ones.
Kostas Michalopoulos, Business Consultant PRAKSIS BCC and CEO Novogrowth
