Winning Business in a Cashless World
By Bloomberg Live
Dealing with the realities of the Coronavirus pandemic has been challenging for all – and small businesses in particular have pulled out all the creative stops to adapt their business models. The need to be resilient and innovative has never been more important, and small businesses have found new ways to continue in this new environment, pivoting their existing ways of working to survive.
One trend that has emerged out of the pandemic is the increasing desire for consumers to pay digitally – for both ease and hygiene. However, recent research has shown that not all small and micro businesses are set up to accept digital payments. In the U.S., one in five businesses only take cash payments, and in the UK, when it comes to micro businesses, it’s twice that. Not being able to accept digital payments could hinder growth.
Barriers for small businesses when it comes to accepting cashless payments include finding reliable, credible payment options, hesitation over implementing a payments system and the fear of online fraud. Digital payments raise the inevitable questions about rising cyber fraud, which accompanies this trend, as well as concerns over data privacy.
With Black Friday and Christmas just weeks away, how can small and medium enterprises ensure they are well prepared for the holiday season? And how can they take preemptive measures to minimize risk when it comes to cybercrime? We hosted a roundtable discussion with other small and medium sized businesses to share common challenges, discuss adapting your business during these unprecedented times, and strategies for approaching one of the busiest periods of the year.
- Jeanette Bolden-Pickens, CEO, 27th Bakery Shop, Inc
- Rachael Corson, Co-Founding Managing Director, Afrocenchix Ltd.
- Keval Dattani, Co-Founder, Mo Bro’s Grooming Co.
- Libby Ewart, Founder and CEO, The Box Party
- Jim Magats, Senior Vice President, Omnipayments, Paypal
- Steve Palmer, Managing Partner, The Indigo Road Hospitality Group
- Giovanni Roberto, Co-Founder and Deputy CEO, Winelivery SRL
- Bloomberg Host: Sasha Qadri, Senior Programming Editor, Bloomberg Live
Click here to view the full discussion.
The pandemic has offered both challenges and opportunities for small and medium sized businesses. Bloomberg’s Sasha Qadri kicked off the conversation by asking participants what changes they’ve had to make to their businesses this year.
Giovanni Roberto, Co-Founder and Deputy CEO, Winelivery SRL runs an Italy-based business that delivers wine, spirits and beer to customers within 30 minutes. He says his business has increased six-fold from last year as a result of people staying in a lot more this year, but it’s been difficult to manage the value chain. He ran out of space to store his wines. “We had to pick bigger spaces to store more products, we had to ensure a resilient supply chain, so that’s what we did, in the middle of the pandemic. We had to add other spaces to store more product.”
The experience has been similar for Rachael Corson, Co-Founding Managing Director, Afrocenchix Ltd. experienced. After an initial dip in sales, demand for her hair care products soared. That meant making more product, “but the supply chain has been a complete mess,” she said. “We sell a lot of products with pump tops and suddenly everyone is buying handwash, hand sanitizers. So a lot of the companies that make the packaging weren’t able to fulfill our orders so we had to think outside the box and come up with new ways to get the product in the customer’s hands.”
Keval Dattani, Co-Founder, Mo Bro’s Grooming Co. saw sales increase around 500% this year as a result of barber shops being forced to close during lockdowns in the UK. He, too, ran into supply chain issues. Dattani talked about the importance of being agile and reactive when facing unexpected situations. “There are a lot of adaptations we had to make to adjust to the disruption, figuring out where new suppliers needed to be introduced,” he said, adding that the pandemic “highlighted the importance of having multiple suppliers and not just one.”
Libby Ewart, Founder and CEO, The Box Party launched her children’s party supplies business just as Covid-19 hit. A busy home life with two young kids and a busy, working partner meant she never got a chance to start her business earlier. “Lockdown was the perfect opportunity,” she said. She used that time to source her products, do photoshoots and get her website up and running. But then came the lockdowns in the UK, which put an end to children socializing. She’s now pivoted to providing supplies for office Christmas parties. “As a new business, my challenge is, ‘what’s my message?’ Because I was very clear on my message before, who I was, what I was trying to do. Very quickly that’s changed. There’s a lot of noise and I wonder, ‘am I being confusing?’ Because now I am sending gin and tonics in the post instead of unicorns!”
Jeanette Bolden-Pickens, CEO, 27th Bakery Shop, Inc runs a small business that specializes in pies. When Los Angeles went into lockdown, people stopped going into retail establishments. “That was a big, big challenge. We lost 50% of our business right there,” she said. To counter that slump, Bolden-Pickens started using delivery apps to get her pies to consumers. She said that led to a big change. “What do we do when we are at home? We eat!” she said. In addition to delivery apps, selling her products through grocery stores and kerbside pick-up helped her business ride out this challenging time.
Steve Palmer, Managing Partner, The Indigo Road Hospitality Group runs 24 restaurants. For him, the pandemic has been tough. “Our restaurants are Italian, sushi, and high-end Japanese. They are very based on social interaction and contact service based on a high level of customer interaction. We were shut down for two months. We tried to pivot – a lot of our food doesn’t travel well in a box.” Palmer said revenues have come back a bit but he plans to shut down four of his 24 restaurants.
Jim Magats is Senior Vice President, Omnipayments, Paypal, sponsor of this event. He said the pandemic “is a story of resiliency.” While there have been a record number of small businesses closing in the U.S., Magats says he’s also seen the greatest increase in new businesses being started. He went on to point out two further trends that have emerged. One, a surge in digital. “Primarily digital-first businesses have grown more,” he said. Then, from the consumer angle, customers are looking at paying via installments. “They want the ability to pay when their cash flow allows them to,” Magats said.
Bloomberg’s Winning Business in a Cashless World Roundtable was Proudly Sponsored By
LinkedIn: Bloomberg Live
Interested in more Bloomberg Live virtual events? Sign up here to get alerts.