Surprisingly, despite the fact that the pandemic has been raging for two years, many businesses in America are finding economic success. From the bleak picture formulated in March of 2020, this positive economic news is a welcome surprise for entrepreneurs and workers alike. By changing their business models and leaning in to the niches the pandemic has offered, many companies are meeting with success.
Preparation brings Promise
As 2022 begins, it is obvious to scholars that the business world did not react in the way economists predicted at the outset of the pandemic. All of the doom and gloom predicted at the beginning of March 2020 did not pan out, and in fact, some elements of the pandemic actually made it easier for businesses to thrive.
“At the start of the pandemic, if you asked us to look forward, I don’t think we would have expected this outcome,” said Brian Kloss, a portfolio manager for Brandywine Global, a unit of Franklin Resources Inc. that manages about $67 billion in assets. “This has been very different than any other cycle we’ve seen.”
Businesses were worried about the liquidity of their companies, but because of the measures that were taken to continue a positive cash flow, they actually ended up better off in the beginning of 2022. The stock market also ended 2021 on a high, which experts did not predict early in 2020. These factors, along with the governments’ trillions of dollars in aid, helped businesses stay afloat and even advance.
A Positive Trajectory
In addition to the resourcefulness of business owners keeping their businesses afloat, the government also offered some assistance.
“Government programs provided funding for businesses, helping them keep workers, while enhanced unemployment benefits and direct aid to consumers also kept income up, said Kathy Bostjancic, chief U.S. financial economist at Oxford Economics. “The support to households was greater than in the past, so that really helped fuel consumer spending.”
Because companies had a cushion and consumers did as well, much of the business world was able to withstand the onslaught of the pandemic. But of course, the larger businesses fared better.
What was truly remarkable is that there were some unlikely start-ups during the pandemic that have been successful. In a time when many other businesses were closing, other entrepreneurs took a leap of faith and opened or refurbished existing businesses.
One of them was Marc Bridge of Seattle, who started At Present, an online jewelry retailer, last August. “We were selling things that people wanted, little doses of joy in a period so painfully free of that, and jewelry was surprisingly consistent with people’s lifestyles. You might be wearing sweatpants, but if you’re on Zoom every day, it’s nice to put on a pair of earrings.” Taking a leap of faith paid off for Bridge and other entrepreneurs like him.
Resilience Required
One reason that many companies have been able to land on their feet is their ability to think outside the box and be creative in dealing with the volatility of the last two years. Experts and economists expect more unpredictability in 2022. With Omicron blazing across the country, the numbers of Covid cases are worse than ever, and many Americans have a sense that things will get worse instead of better.
“As we go into 2022, I think it’s this theme of just volatility, and it’s not one particular type of volatility. It’s enormous volatility in our supply chain. It’s everything from input availability, capacity, transportation, labor, it’s Covid adaptations by ways of working adaptation. It’s this accordion economy of sort of stop-and-go and the adaptations required,” Shane Grant, Danone North America CEO said.
The companies that have been able to roll with the punches, use ingenuity to counter supply chain and labor issues, and save some money for a rainy day will continue to thrive in the future.
“The volatility is likely to continue,” said Damola Adamolekun, CEO at restaurant company P.F. Chang’s. His motto is to “Do more with less. We have a saying here now: do less better.”
Creating simplicity in the business world also goes for work routines, Grant said. “What’s been important and will continue to be important is how we create more simplicity in our business and for our people, to deal with that volatility. … we can simplify all that’s within our control to allow people to deal with the volatility that’s just somehow baked into the macros at the moment.”
Resilience is required for businesses and their leaders in 2022. With no end in sight to the pandemic, the country must dive into the pandemic and work with it, rather than expecting it to end soon. Getting back to the basics with a clear business model and creative employees will help businesses stay afloat in these tumultuous times.
I like to spend my time giving back with organizations that focus on mentoring aspiring entrepreneurs. I have supported after school programs that focus on entrepreneurial and global initiatives in local primary schools. I recently extended my mentoring to include students at Case Western Reserve University.