Business in the Coronavirus Era

We’ve gone from looking at the coronavirus from afar to being in the middle of the coronavirus storm. It’s obviously changed the business and outlook for the year. While tragic, and disruptive, the phrase “this to shall pass” should be kept in mind. Keeping calm, making sensible decisions and keep #AmericaStrong.

Some thoughts regarding doing business in the coronavirus era:

1. Take care of your people.  If they are concerned about family, they are less focused on business. If they feel you are not concerned about them, or their family, their commitment and loyalty to the business diminishes.
2. Clean, clean and re-clean.  Yes, you’ve heard it and hopefully you’re practicing it and preaching it. Some distributors have told us that they are also spraying incoming orders with Lysol and then waiting to put the material away. Others have staff wearing gloves, and changing them frequently. Drivers need to be stocked with gloves, sanitizers and wipe everything down regularly.
3. Warehouse staff are critical.  While many others can work remotely, warehouse personnel and drivers are the lifeblood of your cash cycle.  If material can’t get put on the shelves and then taken off to be put into trucks, or customer vehicles, business stops. Consider how to support them. Consider how you to increase capacity in case someone gets sick, someone needs time off due to family needs, needs a break, etc… Perhaps Amazon and grocer’s plans of adding some staff may make sense.  A little extra capacity could be helpful … or identify some of those “remote” workers who can transition to the warehouse.
4. Consider additional delivery services you can offer.
   • Distributors are providing “curbside pick-up” / “curbside delivery.”
   • Distributors are having customers call, email or text orders and are bringing material to the truck
   • Some companies offer overnight delivery / early am delivery as a standard, some are promoting it.
   • Some distributors delivery to lockers or remote facilities.
   • If you have job-site trailers you use for contractors, how could these be deployed to support key customers or geographic areas.
   • Social distancing is changing delivery confirmation processes. No longer handing over a clipboard / keyboard for a signature. Considering taking a photo with a time stamp or an alternative documentation method.
5. Communicate, communicate, communicate.  Sales has always been a sub-segment of marketing as it was the human delivery of messaging.  Now salespeople are remote telemarketers. Make sure they are “smiling and dialing” to keep in touch with customers … and multiple contacts within each customer. This is the value of relationships.
   • And remember those “compensation justification” accounts that every salesperson has? The accounts that they receive sales credit for but rarely call on? With reduced windshield time, perhaps calls, or at least emails, could be made / sent to these accounts. Let them know your 1) concerned, 2) open and 3) available to help them.
   • Companies are “pivoting” in the new environment as they expect the “new” business environment to be for an extended time period.  Online training sessions becoming “norm” which requires presentation development, invitations and reminders as well as coordination of multiple presenters from multiple locations (home) and training presenters on retaining engagement (rather than “listeners” doing email!)
6. Credit Check – with a fluid work environment and job-sites in some markets being shut down, as much as we hate to say it, but check the DSO’s of your customers. Many contractors work on a cash flow basis.  No cash coming in means no supplier payments going out. Be cautious, but at the same time recognize that these are customers you will want to do business with later. And the same goes for manufacturers with distributors.
7. Automate – use this opportunity to utilize the automation tools that you have as well as promote the tools that you have.
   • Able to take online orders, promote it.
     • And if you don’t have a commerce-enabled website, we know of a source that can launch an eCatalog with thousands of SKUs for distributors in days, enabling you to offer self-service / a new resource to your customers (call for details)
   • Offer a text ordering service, promote it (or allocate a phone and promote that text number!).
   • Utilize eMarketing tools creatively to share information (and be creative through promotions, top 10 lists, business updates, etc).
   • Consider short videos, even “homemade” to share product installation tips / product benefits
   • Consider deployment of a sales engagement platform to support your salespeople (and populate it with manufacturer contact (take a look at Klyck).
   • If you have a CRM tool, conduct a sales refresher. Without the ability to “walk around” and share an update, populating CRM with the appropriate information may be more important than ever … as a way to communicate from outside to inside sales and vice versa.
   • Consider setting up private LinkedIn or Facebook groups to keep customers informed and to share “community” information.
   • And utilize any “back office” automation tools to their maximum capabilities … EDI, VMI, etc.
8. Personalize / “Communitize” – Similar to natural disasters and terrorist events, we’ll get through this but it will take “a community”.  Consider how to “give back.” Distribution is a local business. How can you support your community? How can you support your customers (especially smaller, independent contractors?)
   • Support local businesses – Given that many states have mandated that restaurants cannot serve in-dining guests, restaurants are suffering.  To support local businesses, and if you can afford it, perhaps considering supporting local restaurants. For example, DoorDash has added 100,000 independent restaurants to DashPass—our subscription program which offers $0 delivery fees for customers—for free to help them generate higher sales while offering more selection to DashPass members.

Some other tidbits:

• NEMRA joined a list of associations in signing a letter to Congress and the President advocating support for small business due to the impact of the coronavirus. Click here to read the letter. They also have a video that has guidance for small and medium sized businesses.
• Many have heard that Boston shut down construction sites in the city due to the coronavirus. With “shelter in place” and the definition of “essential / non-essential” businesses, this could occur in other major areas where there have been large outbreaks.
• California declared a total lockdown for 40 million people
• Pennsylvania closed all non-essential businesses.  While electrical distributors may stay open, electrical / lighting manufacturers are required to close. Read more here.
• China imports in February declined 21%! And it is expected that March will be worse. Consider what this may mean for inventory from some suppliers. This is a good reason to keep in touch with your key suppliers to understand their sources and inventory levels. When ordering from those who are dependent on sourcing, confirm “on hand” inventory before placing orders.
• With Marriott laying off “tens of thousands”, Vegas casinos closing and more, the commercial MRO business will stagnate.
• The automotive industry is essentially shutting down for up to a few weeks, impacting 150,000 employees and then the potential ripple affect to tier 1 and 2 suppliers. This will impact electrical distributors who serve these companies.
• While at the time of this writing there are over 13,000 confirmed cases of coronavirus and over 200 deathsdue to the coronavirus, it is also important to remember that it isn’t “everywhere” (although could get everywhere). So, feedback you may hear about the electrical market may not apply to your area. Take a look at this map from the NY Times.

We’ve had calls asking about our “crystal ball”, which, like everyone’s is cloudy given daily announcement and a changing market. The two things we do know is 1) it will take some time and 2) the future, at some point, will brighten.

While now is the time to “button down the hatches”, it can also be the time to do some planning and/or address things you’ve put off. Priorities get rearranged and what was planned (i.e. counter days) is not going to happen, so how can that time be redeployed.  As we get into a rhythm of working remotely, there will be opportunities to utilize “down time” differently. We know, coronavirus won’t win.

And remember, in times of crises there will also be opportunities to improve the future.  We’ll touch on some of these in future posts.

Let us know your thoughts and what is happening in your market.

Stay safe.