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2020 has been a huge year of change for businesses and customers alike. As the Covid pandemic threw the usual process of things into disarray, businesses had to adapt overnight. Many industries had to re-evaluate the practices, acclimatise to the new order and significantly alter their long term strategic planning.
With so much change, what will the business landscape look like on the other side as we head into 2021? During the aftermath of the pandemic, many businesses will come out the other side stronger, while others will take time to find their feet again. Accelerated strategies this year will create new opportunities for improvement. However, new challenges are right around the corner, and the impact of Britain leaving the European Union will have a ripple effect across the continent. Here are the three top business trends of 2021.
1. Diversifying business offerings
One of the ways companies have been able to find stability during such a turbulent time is to expand their services so they are not fully reliant on just one. While specialising can lead to holding a top spot and becoming the go to name for a particular service, if that service is no longer viable, it can leave the business at risk. 2020 has shown even the most well known brands have reason to worry and think about their future, and we expect to see more businesses finding security through diversification.
A prime example is John Lewis significantly changing their offering to include rental furniture, garden supplies and the company has even taken marked steps into the housing market. They have built up a loyal following through their traditional retail model, but have recognised that with the shift to online marketplaces and the rapid decline of high street footfall, these other services build upon the brand name while providing new growth opportunities. The key in this diversifying strategy has been listening to the changing needs of their customer base and carefully selecting the most viable opportunities to pursue, rather than spreading themselves too thin.
2. The impacts of Brexit
The repercussions of Britain leaving the European Union will not just be felt on UK shores, but across Europe. Throughout 2021, we will expect to see companies rapidly adapt their supply chains, their workforce and shift their long term planning. How they will do this is still uncertain, but many businesses will have to become more reliant on local communities and markets.
Some of the greatest unseen impacts will be to companies that don’t directly trade overseas but are heavily reliant on cross-border supply chains. The restaurant industry, for example, is already in free fall thanks to the government imposed restrictions, but with heavy tariffs as high as 57% on some food imports in the case of a no deal Brexit, higher prices of ingredients could force many more businesses to close their doors. With fewer than one in five businesses ready for a no deal scenario, leaders need to be reviewing all of their supply chains now, as the impacts across industries will be business critical.
3. Sustainability’s Silver Lining
Around the world, we have seen consumers become increasingly engaged with how businesses are proving their commitment to sustainability. Even under COVID restrictions, climate strikes have continued around the world. The recent backlash against Oatly, an oat milk brand with a strong sustainability reputation, when they received funding from Blackstone, a private equity firm with alleged ties to deforestation in the Amazon, showed that consumers will hold brands accountable for their actions. Sustainability, including everything from carbon emissions to plastic waste, will continue to be an issue for consumers in 2021, one where businesses will have to prove their commitment or risk getting left behind.
It seems now is a time that British businesses should be reinforcing their sustainability commitments through sourcing local resources and securing their supply chains. While the combined effects of the global pandemic and Brexit have caused huge amounts of disruption, the amount of change that businesses have had to go through has created new opportunities to rethink usual processes.
While 2021 is predicted to be the year of recovery after what has been a year like no other, businesses should approach the new year equipped for a whole host of challenges. Those that have learnt lessons this year will be forced to apply them in order to remain competitive, but the ones that thrive will be those seeking out new opportunities. While contingency planning is key, innovative companies will be expanding their services, forming new collaborations and strengthening their commitment to sustainability.
