Dr Jana Matthews, director of the Australian Centre for Business Growth at the University of South Australia, suggests that venue operators should be using the enforced shutdown as a time to make a clinical assessment of their business models, and to find ways for the business to improve once trading returns to normal.
While the enforced closure of hospitality venues has left many operators and their teams awaiting any good news, Dr Matthews suggests that operators should view this time as an opportunity to take stock of the state of their business, and to look at what worked and what didn’t before the shutdown, and where the business could be improved.
“Sports teams practice all week, and then they play on game day. Companies, businesses – every day is game day. You don’t really have much time to step back and think about the practice of the fundamentals.
“The good news, if there’s any about this hiatus, is that it’s enabled everybody to have some time-out. To actually look at what they’ve been doing, what they need to be doing, what people’s preferences might be going forward, and how they’re going to respond and set themselves up for a rebound.”
One area which Dr Matthews encourages all venue operators to take a look at is the financial side – and if you don’t have that kind of literacy, to take this time to become more familiar with it.
“Not everybody has the skills and knowledge to be able to understand their financials. Some people are simply running on cash-in and cash-out, but they’re not looking at cash flow. They’re not predicting cash, they don’t understand P&Ls and balance sheets — they leave that to the accountant.
“Everybody who runs a business needs to understand the fundamentals of finance. That would be something that you could focus on right now.”
This is also a great time to look at the profitability of your offering, removing any dishes or drinks from your menu that perhaps you or your staff have an emotional attachment to, but are not actually creating any profit from.
Ready to re-open
With no clear idea of when operations will be able to return to normal – some days the chatter is of three months, others it’s six, and on bad days it could be even more than that – it’s important to be readying your venue now to re-open as soon as we’re given the all-clear. To do this, remaining in touch with staff, suppliers and patrons is key.
“It’s absolutely critical to keep in touch with employees that you think will remain with the business in the future. Just checking in on them from time to time will affirm their value,” states Dr Matthews.
Similarly, having open communication with suppliers, will keep you front of mind when it’s time to re-open and you are in need of in-demand stock. Meanwhile, some form of communication – but not bombardment – with your customers will also keep you in their thoughts when they can socialise again.
“Some reminder that you’re thinking of them as well is important, to keep that connection. It shows that you value those customers.”