{"id":51416,"date":"2022-01-10T13:36:58","date_gmt":"2022-01-10T05:36:58","guid":{"rendered":"http:\/\/wordpress-my-161844363.ap-southeast-1.elb.amazonaws.com\/articles\/?p=51416"},"modified":"2022-01-12T11:39:45","modified_gmt":"2022-01-12T03:39:45","slug":"sme-survive-lockdown","status":"publish","type":"post","link":"https:\/\/www.imoney.my\/articles\/sme-survive-lockdown","title":{"rendered":"How These Small Business Owners Survived The MCO And What You Can Learn From It"},"content":{"rendered":"

As we emerge from two years of COVID-19 induced movement control order (MCO), it\u2019s not surprising to hear that many small and medium enterprises (SMEs) have been severely impacted.\u00a0<\/span><\/p>\n

Unlike their bigger counterparts, these companies had to navigate the challenges of the MCO without the benefits of having massive resources to fall back on. At least <\/span>150,000 SMEs<\/span><\/a> did not survive to welcome 2022, resulting in 1.2 million job losses since the dawn of the pandemic.<\/span><\/p>\n

If you think that sounds bleak, wait till you see the results of last year\u2019s mid-term survey by Small & Medium Enterprises Association Malaysia (Samenta), which stated that\u00a0 of their members had given up on making any sort of recovery in 2021.<\/span><\/p>\n

Which is why in this article, we\u2019re going to be talking to two SME business owners who managed to survive the lockdown, and what they learned from it.<\/span><\/p>\n

<\/span>Going beyond providing just a service, adding a personal touch<\/b><\/span><\/h2>\n

Luqman Omar, owner of the Barber\u2019s Turf GBK barbershop in Seri Gombak, told us that surviving the lockdown was not easy at all.<\/span><\/p>\n

He shared that due to the on-and-off nature of the lockdown and the type of service he provides, his business was open for less than 12 months in the entirety of 2020 and 2021. This led to his business struggling due to the overhead costs that must be paid even if the shop isn\u2019t open.<\/span><\/p>\n

\u201cYes, it was a struggle because we can\u2019t open our business at all, and we are the last industry that can be opened during the MCO. Although we can\u2019t open the barbershop, we still had to pay our rental, and our overhead cost, which represents a very significant dilemma for me, as I had to pay out for a business that is not making any money,\u201d said Luqman.<\/span><\/p>\n

According to Luqman, his two main methods of navigating the lockdown were using his business savings and adapting to the circumstances.<\/span><\/p>\n

\u201cWe did whatever we could do. We start to look into other businesses that can operate during MCO. Inspired by the food and beverage business, we decided to look into the viability of a house call barber service, or in simpler terms, a \u2018haircut delivery service\u2019,\u201d stated Luqman.<\/span><\/p>\n

Luqman also stressed the importance of quality and making genuine connections while providing house calls, as that will ensure his customers will come back to his shop once the lockdown is lifted.<\/span><\/p>\n

\u201cWith the house call model, the most important thing to do is to maintain the quality of our service because only with a premium quality and genuine connection can we ensure that our customers will return to us even after the lockdown is lifted,\u201d added Luqman.<\/span><\/p>\n

According to Luqman, although the house call model his business adopted was bringing in some money during the lockdown, it was his business savings that ensured the survival of his business.<\/span><\/p>\n

\u201cDuring the lockdown, my barbershop was only saved due to the availability of our business savings, which helped cover the expenses incurred by the barbershop, even when we didn\u2019t have any customers,\u201d said Luqman.<\/span><\/p>\n

<\/span>Learn to adapt to the circumstances<\/b><\/span><\/h2>\n

Nazmi Nasir owns Amitech Solutions, a shop that provides computer works, such as repairs and parts selling.<\/span><\/p>\n

Unlike Luqman\u2019s business, Nazmi\u2019s business boomed in the early stages of the first MCO, due to people\u2019s realisation that they needed computers\/laptops to work from home.<\/span><\/p>\n

\u201cMy business thrived when the first lockdown was initiated. I had more sales than before because everyone realized that they needed a computer to work from home or for online classes,\u201d said Nazmi. The various <\/span>government initiatives<\/span><\/a> rolled out in 2020 which included incentives and tax reliefs for phones and computers also contributed to this boom.<\/span><\/p>\n

However, the situation didn\u2019t last as the government did not allow non-essential businesses to operate in the later MCOs.<\/span><\/p>\n

This caused a severe strain on his business, as he was no longer able to open his shop and receive new customers there.<\/span><\/p>\n

Nazmi had to adapt and he switched to an online model, where his customers paid to have their computers and laptops picked up and delivered to Nazmi.<\/span><\/p>\n

\u201cHowever, this did not work so well, as a lot of my customers were not keen on paying the high delivery charges,\u201d said Nazmi.<\/span><\/p>\n

Like Luqman, Nazmi also had to pay rental and operating costs, even though his physical store was closed down. So how did he deal with this situation?<\/span><\/p>\n

\u201cI had to dip into my business savings a little, as what the company brought was not even enough to cover my overhead costs. But due to this, I also had to start thinking about some other ways of making money,\u201d said Nazmi.<\/span><\/p>\n

For Nazmi, this meant doing odd jobs, deliveries, and investing.<\/span><\/p>\n

\u201cDuring the second lockdown, I did a lot of stuff when I\u2019m free. From odd jobs, Grabfood and Food Panda, even investing, I tried my hand at all of them. After all, I needed to find supplementary sources of income to help make up for what my business is not making,\u201d he explained.<\/span><\/p>\n

When asked what kind of investing he explored, Nazmi said that he was primarily looking for short-term investments that have the potential to give out faster returns.<\/span><\/p>\n

\u201cMostly Forex and cryptocurrency trading, as these two types of investments allow for faster returns, which I needed to supplement my income during those months,\u201d\u00a0 he added.<\/span><\/p>\n

<\/span>3 key takeaways on surviving the lockdowns<\/b><\/span><\/h2>\n

While they may be talking about their business survival, there are lessons we can learn and apply to our own financial management as well.<\/span><\/p>\n