The COVID-19 outbreak has been hard enough for up and running businesses as they have to close their doors to business during the lockdowns, but how hard has it been for people looking to start a business during an outbreak? In this Blog we are going to discuss how you could start up a business during a Global crisis, also what kind of businesses have thrived during these times and what kind of businesses have failed.
During the lockdown people have had the chance to think about their passions and they have been able to be a lot more creative, with people who have been furloughed, or people who just want to pass their time due to not being allowed to do their usual activities.
According to Crunch “business formations grew by a staggering 47% in June according to Companies House.” (1)
What type of businesses failed during COVID-19 and what type of businesses grew?
Some of the businesses that failed/went into administration during COVID-19 are Monsoon, Bonmarche, Quiz, Debenhams, Bright House, Arcadia group (the company owns Topshop, Dorothy Perkins, Burton and Miss Selfridge) From this list the majority are clothing brands, and although they do sell online they are mainly known for their high street shops, although not all clothing brands have failed, this is shown through Boohoo, where their chief financial officer, Neil Catto, states “We have seen customer acquisition grow quite strongly during the lockdown period” (2) also going on to say “there’s obviously an opportunity to take advantage of the fact that customers can only shop online”(2) Boohoo are an online based clothes shop known for their fast fashion and discounts. (2)
The businesses that thrived during COVID-19 were delivery services, such as grocery delivery, retail delivery and food hav seen a strong demand.
graph showing the growth and decline due to COVID-19, https://neilpatel.com/blog/covid-19-marketing/
“A key challenge during COVID has been striking a balance between having empathy for the things that are happening in the world, while at the same time not taking the foot off the gas,” – Alexandre Douzet, founder, Pumpkin Pet Insurance (1)
What you need to set up a business during COVID-19
Know yourself as an entrepreneur – Many entrepreneurs have specific personality traits to make their business a success, such as Motivation, starting a business isn’t going to a clear path, there will be difficulties and obstacles that pop up in your path, but you will need to motivate yourself to pass the obstacles. Vision is another personality trait that will help you along the way in starting up your own business, entrepreneurs need a clear vision on what they are going to do, and you need to keep your eye on the big picture. Flexibility is another personality trait that is needed, you will need to be able to adapt to changes within your business.
Thinking about business ideas – Once you can see yourself as an entrepreneur, you will need to come up with business idea, this is where your creativity comes into play. You could do something your passionate about, like start a blog or you could so something that you are good at such as starting a Bakery, But you’ve also got to think can this be done from home? Do you need to rent a property to run your business? Are you able to run your business whilst following the COVID-19 guidelines.
Resources – how is your business going to be funded, is the main source of funding going to be coming from you, this is also known as bootstrapping, or is it going to be loaned from a family or a friend? Or you could apply for a start-up loan from the Government, I have included a link for the official start-up loan website, the only thing you need is to be is over the age of 18, live in the UK, plan to have/or have a UK based business that’s been fully trading for less than 24 months.
https://www.startuploans.co.uk
The Government also started a ‘Bounce back’ scheme where they were offering to loan up to £50,000 to small and medium sized businesses, and the UK Government guaranteed 100% of the loan and there would be interest and nothing would need to be paid for 12 months. (3)
References
(1) https://www.google.co.uk/amp/s/www.uschamber.com/co/start/startup/starting-business-during-pandemic/amp Starting a Business During a Pandemic? What to Consider First, Nicole Fallon, Contributor
(2) https://www.retail-week.com/fashion/analysis-how-boohoo-has-played-to-its-strengths-during-coronavirus-crisis/7034686.article?authent=1 Analysis: How Boohoo has played to its strengths during coronavirus crisis, Rosie Shepard
(3) https://www.gov.uk/guidance/apply-for-a-coronavirus-bounce-back-loan official Government Website, Department for Business, Energy & Industrial Strategy
