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How to Preserve Your Plant-Based Business & Adapt for COVID19 Storm

3 Tips to be ready for the other side of COVID19

With the COVID19, I’m sure you are doing whatever it takes to keep your business going through these unprecedented times and more importantly keep you, your family and staff safe.

Take a deep breath. You are doing well.

Covid19 will last a few months (if we all do the right thing), and it will pass. I'm basing this on the latest Mckinsey report. Governments will be coming to the rescue in all countries because this downturn is more harsh than the global financial crisis in 2008/09. What does a rescue mean?

According to Hamish Douglass ( who is Australia's version of Warren Buffet), stimulus packages in the vicinity of ~30% of GDP globally. In Australia, this will be equivalent to $500B and in the US, we are looking at $6T.  

In the meantime, we are seeing a massive shock to consumption behaviour, the stock market – and your business! Especially for quick service retail and dining environments.

From a long term plant-based perspective, Covid19 will benefit the growth of plant-based, especially in China and South East Asia.

There are 3 steps to come out stronger from what we are seeing:

1 - Preserve as much cash as you can

2 - Adapt

3 - Double down - invest in positioning your business for growth.

1 - Preserve as Much Cash As You Can

  • DO speak to your bank, if you have a loan from the bank.  Tell them your circumstances you are facing. Ask to freeze or reduce all payments. They may have access to your bank data. They will likely to have funding from the federal government in your country to support them. **Update** - banks have defer loan repayments for 6 months in Australia
  • DO write a letter to your landlord to explain the circumstances – ask for a 3 month rent reduction and aiming to extend this to 6 months. If they have a mortgage, you can share that banks in Australia (Macquarie, St George, NAB) are providing support because of hardship.   
  • DO preserve the good staff if you can – on reduced rates.
    • When the global financial crisis happened, the many US companies downsized by firing staff. The German companies reduced hours for all their staff and kept the good ones.
    • Follow the German approach – not the American
  • DO reduce all unnecessary variable costs. 
  • DO Make payments to your suppliers - after all they are probably struggling too.  
  • DO collect cash on delivery with wholesale sales, so you are promptly paid. 

The Chinese Word For Crisis is the same as Opportunity

2 - Adapt - See the Opportunity

Quick Service Retail

People love your product – but they need to access it. Australia Post deliveries are not slowing, Sumo Salad has seen a 23% rise in delivered meals in the last few weeks. Many offices are sending staff home – so this will depend on your location. (Current as of 16/03/2020)

I) Offer take away only with touch less contact with staff. Great examples here by Shift Eatery in Sydney. They are using only take away platform Hey You for customers to pre-order.

II) Incentivise people to buy from you directly – and dedicate a staff member for deliveries, less than 5kms. (You have to do the numbers to test these assumptions). See example from Eden in Bondi. The better platforms charge less than 5% of the order like Mobi2Go

III) Or boost your online offering, either through existing channels (Ubereats/Menulog/Deliveroo/Doordash) – This is not ideal because of the hefty charge by these companies. If you change your operation to almost a 'dark kitchen' - this could work.
It’s worth using until you ready your business for direct online (ii)

IV) Wholesale offering – Create products in bulk and allow them to purchase this from your store – or drop off. This works well for you fan who is stuck in the home office.

V) Collaborative partnerships with other businesses – You have a fan base, and so does the other business. Together you can create a special evening or pick up take away event. There are many success stories with savoury and sweet companies coming together. In Sydney, see Treat Dreams and I Should Be Souvlaki. In Melbourne, @smithandeli (plant-based delicatessen) are collaborating with a Northside Fruit and Veg.

Consumer Packaged Goods without the major outlets

  1. Create a shopify store.
    1. If you have your branding complete, it can be done within an hour, see here
    2. and here's the checklist
  2. Collaborative partnerships with other existing shopfront businesses – You have a fan base, and so does the other company. Doubling the traffic helps.
  3. Speak to other businesses, about collaborating delivery. Existing distribution channels in Australia, Flora & Fauna, Cruelty Free Shop. And other channels in your region.

Wholesale Businesses (selling through cafes)

  1. Create a Shopify Store (see above)
  2. Encourage larger purchases with special deals
  3. Easter is not going away – people will be stocking up bakery items for Easter & they may not want to go to the shopping mall.
  4. If you have a factory - which looks good enough. You can open up a factory shop – like The Cheesecake shop - with strict sanitary conditions. 

For Chefs & Specialised Service

  1. Create a special offer to cook at peoples homes for the week. There is a massive need for this service – especially now.

3 - Double Down & Invest in Your Business Growth.

Plant-based food will accelerate further after covid19.

  • China is importing US brand Just Egg for the first time ever.
  • Brands like Beyond & Impossible are unlikely to be imported into China because they have their own plant-based brands. However, this presents an opportunity for Australian brands. 
  • China have stopped wildlife trade, with 20,000 farms shutting down. Vietnam is likely to follow. 
  • Slowly but surely people are starting realise the causal links between animal protein and human health. 
  • Even in Australia, sales of fruit and vegetables has risen sharply in the last few weeks.

From the hundreds of plant-based business owners I have spoken to, what they have asked for is time to review the business as a whole. For those businesses, #COVID19 is a blessing in disguise.

Once you have done steps 1 & 2, you are ready to look at your business with fresh eyes.

Where does your business sit in the 5 stages of the business life cycle.

Do you have new opportunities available to you in new channels?

The following video goes through the three step process of where and how you would like to continue your business. The colour is dark, but the content is gold! 😊

We trust this has been helpful. If you have anything more to add, please contact me at bob [at]betcatalyst.com.au to update this page. We'll be updating this page regularly as a guide.

We wish you, your family and staff a safe passage though the other side of Covid19

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