[This is a sponsored article with HSBC.]
Running a business on a normal day is no easy feat; trying to do so post-pandemic while the economy is still recovering is even tougher.
But if there’s anything that the many obstacles in the past two years (such as the pandemic and more recently, the floods) have proven to us, it’s that Malaysians are resilient.
We at Vulcan Post have heard first-hand stories of struggling SMEs with passionate founders putting in their all to make sure their businesses survive.
This new year, entrepreneurs will want to better balance their personal and professional lives, and though it won’t be an easy route, there’s a supportive community out there.
To understand the highs and lows SMEs have faced thus far, we spoke to 2 big industry names, Shockwave and Tiger Sugar, who also shared some real lessons that entrepreneurs can bring into 2022 for improved business acumen.
Always have a healthy runway for emergencies
Andrew Chu, Project Director at Shockwave, an event management and interior design company, told us that their daily operations pre-pandemic were largely centred around physical meetups, whether it was with clients, internally, to set up events, do renovations, or site visits.
Like many others, they were caught unprepared when the first lockdown came. “The first two weeks were spent on coordinating and organising resources to work from home, in order to continue our operations,” Andrew recalled.
Yet business remained halted for a long time. Thankfully, they had a 6-month runway to tide them by, but the team knew they had to pivot soon.
In the third to fourth week of the lockdown, Shockwave had a new plan. Do some online live interview programmes and events, then venture into online conferences, meetings, and more.
Business only truly began recovering in October 2021, but Andrew noted that clients and customers are still cautious with expenses.
Not to mention, materials, manpower, and suppliers’ costs have increased. However, to remain competitive, Shockwave is unable to increase their price proportionately. Therefore, the business is still running at a loss.
Yet Andrew and his team will continue to power through by focusing on their existing clients. He predicted it’ll continue to be tough for now, but believes that his team’s will to overcome this is equally as tough.
Though their main focus is still their core business in event management and interior design, they will be investing more time and money into digital sales and marketing.
No time to rest on one’s laurels
You would’ve thought F&B saw a slightly easier time during the pandemic, but KS Lu, franchisor of bubble tea brand Tiger Sugar revealed that was not the case.
In December 2019 and January 2020, they made over RM1.7 million in revenue (about 140K cups of drinks), but the moment the lockdowns happened, sales dropped to only 20% of that figure.
“MCO periods around October 2020 onwards were the most brutal. Directors had to inject fresh funds to keep the operations going,” KS recalled.
Currently though, sales are improving and edging past the 50% mark, and they’re starting to receive around 10 sub-franchising enquiries per month again.
KS knows that this is not the time for Tiger Sugar to let up on all its intensive efforts thus far though, so they’re still cutting costs where possible and trying to improve productivity all around.
Similar to Andrew, he’s anticipating that they’ll face a tougher business environment due to consumers’ spending uncertainties. But they won’t be deterred, as KS revealed Tiger Sugar will be launching new products soon.
Getting the right financial support
Despite the passion these business owners have, finances are still the key to seeing their ambitions through.
To that end, many business owners opt for specific banking solutions to take away the concern of finance management.
As HSBC is no stranger to supporting business owners who face challenges of managing a small business and personal finances, it came up with HSBC Fusion.
This solution tackles both aspects in one place, allowing entrepreneurs to simply focus on turning their businesses around.
It offers features such as fee waivers, better rates, a dedicated relationship manager and contact centre, access to the HSBCnet digital banking portal, and more. Entrepreneurs who are interested in getting started with HSBC Fusion can learn more here.
But finance management is only one part of keeping a business running; putting lessons learnt to practice is another major factor as to why some businesses succeed while others fail.
Following their experience in the pandemic, Shockwave and Tiger Sugar had some important business lessons to share.
Andrew mainly lamented that Shockwave should have taken the situation more seriously back then to immediately look into cost-cutting measures.
Maintaining operations at full capacity during uncertain times was not their best decision, but is one that the team won’t be repeating anytime soon.
That aside, “Always look into adopting changes and diversifying your business to spread your risk,” he advised.
From a franchisor’s perspective, KS gave his two cents: “Do not expand too fast. Explore funding options before expanding using either self-generated funds or savings.”
It’s encouraging to see passionate business owners such as Andrew and KS fight on despite the challenges, and even more inspiring are the bold entrepreneurs taking leaps of faith to launch new businesses.
Every week or so, we’ll see a new business pop up in the market across various industries. For example, some pandemic and post-pandemic-born names in F&B include Mori Kohi, ONO, Bricks & Bread, The Rabbit Hole, and more.
These point to the fact that though still careful with spending, consumers are itching to browse and support local brands, old and new.
The nation is holding out hope that this trend will continue to rise, and by then, it will only be a matter of time before our economy is back in full swing.
- Learn more about HSBC Fusion’s offerings here.
Featured Image Credit: Shockwave / Tiger Sugar