For those businesses that reset their businesses to cope with the lockdown, are rebuilding their systems to entrench their positioning, the data says we are 3 to 6 months away from reigniting revenues.
Pavlo Phitidis drew on a random portfolio of 50 Business to Business (B2B) SME clients, and identified four data points which suggest that these businesses have hit the bottom and are now turning up….at pace.
Listen to him talk about his findings on The Money Show on 702 and CapeTalk:
What data was used
Four data points were used. Average monthly turnover, average monthly profitability, average number of jobs all over a running 3-month average. The fourth data points make up the 7 periods of measure from Nov 2019-Jan 2020 through to May 2020-July2020.
What did the data show
These seven periods of measure take us from a normal economy to level 5 lockdown and then move to level 3 lockdown.
|3 Mnth Average||Turnover||Profitability||Jobs||Economy (Months)|
|Nov’19 – Jan’20||-6%||29%||1,601||3 open months|
|Summer holiday period fall in sales, temporary jobs to cope with load|
|Dec-’19 – Feb’20||10%||101%||1,424||3 open months|
|Jan, Feb restocking of product and service to get going, job changes|
|Jan’20 – Mar’20||1%||-75%||1,501||2 open, 1 lockdown level 5 month (L5 lock)|
|1st month of lockdown, profitability plummets with a 3 week anticipated lockdown not reducing costs|
|Feb’20 – Apr’20||-2%||-10%||1,395||1 open, 2 L5 lock|
|Now evident more than 3 week lockdown, retrenchments activated|
|Mar’20 – May’20||-17%||-36%||1,099||2 L5 lock, 1L4 lock|
|Full lockdown shock, cost reduction, RESET phase activated|
|Apr’20 – Jun’20||-2%||78%||1,099||1 L5 lock, 1 L4 lock, 1 L3 lock|
|RESET phase complete, new business model emerging, REBUILD phase activated|
|May’20 – Jul’20||-8%||146%||1,263||1 L4 lock, 2 L3 lock|
|REBUILD phase ongoing, readying for REIGNITIOIN, employment of new talent picks up|
What does the data confirm
Every crisis should see every business owner adopt a 3-phase strategy in response.
At Aurik we have been working with businesses throughout the lockdown to do just this, contact us to find out how we can work together to Reset Rebuild and Reignite your business.