No doubt about it! The first half of 2020 has been historically challenging for Calgary. The COVID lockdown, the economy and the jarring global oil price crash have been unprecedented broadsides for most aspects of Calgary business.
While all of Canada is reeling from the social and economic impact of the lockdown and collapsed oil prices creep upward, a hopeful and much-awaited Calgary kick-start is happening in different ways in different areas.
According to the recent report by the Conference Board of Canada, national GDP growth is forecast to decline by 4.3 per cent for the balance of the year. The report also forecasts that Alberta’s economy will likely be the hardest hit in the country, due to the double whammy of the pandemic and the oil crisis.
There is light at the end of the tunnel! The undaunted Calgary business spirit is sparking a gradual but encouraging outlook. There is Calgary business consensus that the past few months have been risk management at its absolute unexpected, unpredictable worst and something the most experienced and savvy business leaders could never have anticipated.
“It’s impossible to properly prepare for a near total shutdown of the economy,” says Gerry Wood the iconic Calgary entrepreneur, philanthropist, Order of Canada medal recipient and president of the Wood Automotive Group. “The entire community was told to stay home. Health officials ordered businesses to shut down. Almost overnight, revenues dropped to near zero for thousands of businesses. Some staff had to be laid off, others had to be taught how to work from home. Rents came due. Suppliers had to be paid, and there was basically no business being done.”
The unique uncertainties of the necessary risk management were a major broadside for most Calgary businesses. “The problem is in the not knowing. The uncharted waters” admits Charron Ungar, the dynamic CEO of the Homes by Avi Group of Companies. “There is very little to grasp on to for comparables to this situation and, when it comes to business, it makes for a constant gut check for decisions moving forward.”
The response of Calgary business is a prime example and validates the well-intentioned cliché that ‘when the going gets tough, the tough gets going.’
“Business owners need to be resilient and flexible during these unconventional times,” notes Milena Radakovic the innovative and high-energy president of Nexus Exhibits, the visual branding solutions company specializing in exhibits and interior décor branding. “Good entrepreneurs are visionary and need to be able to pivot their business under difficult circumstances to support not only their business but the community.”
Just as the multi-dimensional lockdown impacts different businesses in different ways and there are common thread aspects of the business new normal, different sectors and businesses are moving forward in different ways. “Businesses must be able to adapt quickly, find new ways to move forward and have empathy for their clients,” says the respected and dynamic Calgary Realtor Sam Corea. “It’s important to get feedback from clients and find out what protocols need to be in place for their comfort. It’s critical to educate them on what protocols and changes you have made to meet those needs.”
“During the first few months of 2020 we were seeing an increase in sales activity and improved consumer confidence. After the pandemic hit, the market practically ground to a halt in the middle of March through May. By June, Calgary buyers became more comfortable. We anticipate that July, August and September will see more improvement,” Corea explains. “Normally the summer months are a slower time but with so many people staying home and not travelling the sales activity will increase.”
Gerry Wood speaks from the wisdom and expertise of more than 25 years of Calgary business. “Business must be optimistic but realistic and the confidence that we will get through this crisis. Business must also embrace new technology and new ways to do business in the new normal. Staff must be looked after and business has to be more responsive than ever to the needs of customers and clients and adjust the way business is done to meet their needs. Business has to Work closely with vendors and suppliers, pay attention, be nimble and be ready to pivot on short notice when needed.”
According to Ungar, a key to business recovery is approach. “Cash is king, so limiting spending to the most pressing opportunities and commitments is vital. Combining that conservative approach with our best efforts to stay nimble and lean is key.
“The other must-do is communication: from company to clients, establishing safety protocols for our sales centres and updates for homeowners about warranty processes, company updates for staff about what is happening and how the company is performing and between the leadership team and the company decision makers. Everyone must be on the same page with clear direction moving forward.”
Radakovic agrees. “Having good, transparent, open communication is always the best way to communicate with clients and customers. Asking for what kinds of support they need, under the circumstances, can help business owners come up with creative ideas to support them during crises.”
It’s unanimous. Now more than ever, as business moves forward, consumer confidence is a critical factor. “We have been pleasantly surprised how our customers have rallied around us over the past few months and we are really encouraged,” Wood points out with enthusiasm. “It’s more important than ever to work with each individual customer and client, take the steps needed to demonstrate to consumers that the business and the staff are taking all the precautions required to keep customers safe and that they can have confidence coming into the place of business.”
“Advertise! Tell consumers what you are doing and how the economy is opening up again. Be creative in pricing and sales offers. Give consumers good reasons to come into your place of business and they will come.”
For many Calgary businesses, the sudden impact of the lockdown is easing and moving forward has kicked-in. When it comes to new homes, “We are seeing pent up demand,” Ungar adds. “Interest rates are at their lowest and we have the deepest price cuts and best inventory in years. There is ultimately unprecedented opportunity in crisis.”
A basic of risk management is planning for —the next time! “When the next wave happens, I doubt if Calgary or the country will close down like it just did. We have learned a lot as a community and country,” Radakovic says.
For Ungar, readying for the possibility of a next time is tricky. “When assessing risk, the variables are just too great and certainty is a distant illusion. While we are conservative in our decision making, there is still a greater reliance on crossing fingers and hoping for the best.”
Sam Corea emphasizes that “Managing cash flow and having several months of operating budget set aside is more important than ever. There will always be new challenges set in front of us, so really the best thing to do to prepare is to be flexible and adaptable and be able to implement new ways of doing business quickly.”
Positive but cautious is Gerry Wood’s advice. “Be optimistic but also realistic. Keep your finger on the pulse of what’s happening and be ready to respond to changes as quickly as possible. We have all heard about the threat of a second wave. Understand and plan for it. Don’t go into the deep end of the pool until you’ve tested the waters and know they are safe.”