About This Lesson
Due to recent events, the global economy is changing immensely. A successful business needs to be able to roll with the punches as circumstances change, because change is inevitable. In order to continue to survive and thrive as the economy changes, businesses adapt their strategies accordingly. Here are some insights around the shifting commercial landscape to help you better understand how businesses work around it.
Foreign Investment
Investment is a crucial part of modern business, as most business owners depend on investors to fund their business in the early years. Investors also stand to profit off of lending money to small business owners, because that loan is paid back with interest if the business is successful. However, current circumstances complicate this system. Many companies in many countries are less viable in this climate, and that presents problems for the business itself, as well as for investors, as their prospects remain in question.
In cases like this, one can look to foreign investment to provide help to another company that also benefits their company during a time in which they may not be making enough money via day to day operations. The advantage of Bahrain economics is that some businesses and some countries aren’t as heavily affected by current circumstances, meaning that they have room to grow. Enabling that growth with investments can provide tremendous financial benefit to companies, as well. This is also beneficial because of the bonds that can be formed by investing in other businesses. Having allies in a business’s pocket is incredibly effective as a long term business strategy, and that goes double for international allies.
Shifting Their Focus
Another important thing to consider is a company’s options for a change of focus. While these changes can take extensive planning that one doesn’t always have time for, changing a company’s role in the commercial landscape can be an effective way of turning a turbulent economy into an opportunity. For instance, essential businesses and workers are now at increased personal risk, but they nonetheless have higher than average financial security under the current circumstances. Likewise, businesses and jobs that are entirely online are somewhat sheltered from the current situation.
Assuming that unforeseen circumstances like these have left a business without much time to chart a new course, there are still options for a business to find a foothold in the changing economy. Business models provide a potential solution, as other businesses may have the same tools in hand, which saves much of the time and money otherwise involved in this kind of change. One example of this is converting a retail location into an online retailer. As mentioned above, online businesses often have enough distance from physical interactions that social distancing doesn’t present the same problems as in store shopping. Therefore, conducting more retail online is one potential way for a non essential retailer to continue to do business.
Innovation
On a similar note, adding to the list of products and services that businesses offer can be a great way to provide the additional value necessary to keep a business going during uncertain times. Innovation is the heart of business, as innovation provides solutions to problems, and that makes innovative products more valuable than comparable products around them. The added value of products and services that don’t have much existing competition can not only provide a business with extra income, but it can also potentially solve some of the problems associated with the current crisis, which is then also providing an essential service.
Diversifying a Business
Likewise, a company can provide additional types of products and services while continuing to stay the course with those currently offered. It’s not uncommon for corporations to own and operate a number of smaller companies of a variety of types in order to maximize their income and value. While the average business can’t practice this exact method, there are ways in which this lesson can be implemented in smaller businesses.
Distributors have tremendous potential to follow this method. Distributors serve the purpose of getting products from a manufacturer to a retailer, and this means that the manufacturers and retailers company’s work with inform a business model and vice versa. By expanding the roster of products that a business buys from manufacturers, enables them to work with a wider variety of retailers. This is particularly helpful in a situation in which many products are temporarily non viable in the market.
Current circumstances and a variety of other situations can potentially derail businesses and negatively impact the economy. However, businesses can potentially circumnavigate these crises in order to come out on top. By adapting business strategies to fit the current climate, a company stands to continue to profit in the face of misfortune.
