The COVID-19 pandemic has challenged the way entrepreneurs do business. Factors that otherwise would never have been considered, such as people no longer showing up in stores on a massive scale and the like, are now top priority.
Josiah Go, author and Chairman and Chief Innovation Strategist of Mansmith and Fielders, Inc., recently gave a talk titled, Business Model and the Chinoy SMEs, to taokes. For Go, businesses don’t need to die even during this difficult time. In fact, they ought to thrive.
Here are a few key aspects that every business must have, according to Go:
1. Beware of the Law of Double Jeopardy.
“The Law of Double Jeopardy is actually [about] offering more for less,” said Go. “As a matter of fact, years ago, somebody approached me and said ‘Josiah, would you like to invest in a franchise?’ I said, ‘Ah, tell me more. What kind of franchise?’”
Go then mentioned that it was a franchise for a barbershop, which is a great idea because “we all need to have a haircut.” The problem was that the barbershop was planning to offer free juice to all customers and offer their services for five pesos less than other shops.
“From a cost perspective, you have to spend five pesos more for the juice drinks and you collect five pesos less. So, your revenue is five pesos less, your cost is five pesos more. That’s double jeopardy — when you have higher cost [and] lower price. Double jeopardy.”
2. Be relevant.
Businesses ought to identify what customers actually need and not what you think they need. Go also mentioned that the aforementioned barbershop wanted their shop to be construction-themed, meaning the barbers would dress up as construction workers and wear construction worker uniforms.
For Go, however, while this may be unique, it isn’t relevant. It’s another very important aspect that every business ought to have: relevance.
“So, the first question you have to ask is ‘How can I be relevant?’ To be relevant, you need to know and solve pain points … For example, if you have a spa, and you start saying ‘Why don’t I have customers?’ [It’s] because people don’t feel certain about it. You can talk about a promo, but they’re not after a promo. They’re after certainty. They wanna make sure how clean is your facility.”
3. Innovation is key.
For businesses to really thrive, they must be able to not just catch up to other businesses, but innovate as well. Businesses must avoid the “Law of Foolish Fellowship.”
“Foolish Fellowship is exactly the way your competitors operate that you have no differentiation at all, that he can be a substitute very easily. So you have to start thinking of how do you exactly operate,” Go said. “You want to avoid being different in the same way. Instead, you want to be different in a different way, which means your business model is the differentiation,” he added.
According to Go, “start doing” refers to what businesses should start doing to improve their business. Go mentioned the case of UnionBank, which has more than 200 branches only compared to the thousands that other banks have.
“In other words, even if UnionBank will keep on adding branches, UnionBank will always be playing catch up. But Union Bank said, ‘No, no, no, no, we don’t wanna play that game. We want to be different in a different way. So what is the ‘start doing’? We will be digital first.’ … As a matter of fact, while you’re having a seminar, you can download the [UnionBank] app, you can open an account [with] zero balance. And [in] many [other] banks, you [still] need to deposit money.”
According to Go, bankers can also deposit a check of less than half a million, and it can be scanned, without the customer having to go to a physical branch. The bank attracted millions of new customers during the pandemic. That’s being different in a different way.
4. Consider how you message your company.
Amid the pandemic, people want safety, believability, and authenticity. Hence, according to Go, businesses must adapt to the current situation through rebranding their advertisements and messaging.
“Please review your messaging during the pandemic because we’re supposed to go normal, but you know … we have more cases of COVID,” Go said.
When asked if the same business model may be applied to all small and medium enterprises, Go answered in the negative. This is because a lot of factors come into play including size of the business, their customers and their needs, and of course, digitalization brought about by the pandemic. Individual circumstances must be looked at and thoroughly examined when making a business model.
However, Go added that businesses must be wary against just changing business models out of nowhere. If a business model works effectively, it ought to be continued. Change should not be the end goal — effectivity and distinctiveness are.
With these tips from a leading businessman, businesses need not die during this time — they can still thrive. Remember: don’t give more for less, be different in a different way, innovate, and send out a good company message.
Due to public demand, Go will be holding another event on April 21 at 7 p.m. If you’re interested, you may register here. For updates, stay tuned to CHiNOY TV’s Facebook page!
For more business-related articles, check out The one key ingredient of all successful businesses and Opinion: Good Businesses Always Care For Their Staff and Pay Well.
The author of this article:
An accomplished young Chinese Filipino writer and media personality, Aaron S. Medina is associated with the Philippine Daily Inquirer, the Ateneo de Manila University Chinese Studies Program, the Philippine Association for Chinese Studies, and CHiNOY TV. He has a passion for truth, justice, and Pokémon, too! Follow him on Facebook: https://www.facebook.com/aaron.joseph.s.medina/