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investment option to run a small business and develop a new career. I’ve been particularly impressed by businesses adapting and implementing innovation in the current environment as their strategy to survive, and in some cases even thrive. The Australian economy is fundamentally altered and will continue to be this way until we can contain the virus, and beyond that. Governments are regulating the way businesses are allowed to operate, or not operate, on a weekly, daily and sometimes hourly basis. Because of this, we’re now moving back to a hyper-localised life. We’re all living, working, and shopping in our own suburbs and towns, and that is habit forming over the longer term. It changes the way we interact and serve our customers, and the way we market to consumers who buy our products. A Sensis business study in August said that 13 per cent of surveyed metropolitan businesses indicated they would close their doors in the next 12 months, and five per cent of regional businesses would do the same. I suspect it will be far higher than that. Cultural, accommodation, and caf and restaurant sectors were most worried about their prospects. Construction, building, transport, storage, finance and insurance were most confident about their survival. The FCA recently commissioned our own research through FRANdata, which found that 46 per cent of survey respondents reported their revenue last quarter was less than 50 per cent compared with the previous quarter, and that the hardest hit businesses were cafs, restaurants, fitness clubs, accommodation and child services. By comparison, 37 per cent of respondents reported an increase in revenue, with takeaway food, maintenance, health, freight and baked goods having an improved trading outlook. Some guiding principles are at play for businesses that I’ve seen succeed through what you’d call a culture of innovation. One is scenario planning: looking at many possibilities for your business, not just one. While we can’t employ people who can predict the future, we can create an anticipatory culture within an organisation. You can’t hang out your shingle and expect people to come buy your coffee. What are your targets? How are you going to meet them? How are you going to out-market your competitors and have nimble and lean supply chains? Systems and processes win the day. That’s why I like franchise systems. Because if you’ve got a passion for serving your customers and working in a team, franchise systems give you those processes, supply chain advantages, market analysis and data that gives you a better shot at success than going it alone. Part of that technical and data driven approach to business means looking closely at how our operating environment changes. Let’s take city CBD areas for example. Office jobs won’t return to what they were before this virus. We’ve proven people can work from home, or as a hybrid between the office and home. We’re not going to have the same levels of international travellers and students coming into the CBD. For international cities like Melbourne and Sydney, there’s a huge correlation between how those international travellers sustain retail trade, and how retail trade directs the city ecosystem, from trading hours to community safety and cultural attractions. That’s why we’re seeing a rethink on retail outlets that were once thriving in the CBD, with these forecast to rationalise in number, but survive in the suburbs and regional towns where people are living and now working too. People are changing their shopping habits and long-term consumer behaviour. Convenience stores and petrol stations, where people once grabbed some milk and a loaf of bread on the way home, are seeing customers now doing more of a grocery shop there, or buying more from their local bakery, to avoid crowds and queues at shopping centres. The lifestyle benefits of regional areas are coming into their own without the worry about a long commute into a CBD job. You can now do nearly any job based a long way from home. From a business perspective, that’s a great investment signal for regions. Previously, innovation in business was thought of only as start-ups and new jobs, but this pandemic has proven it’s so much more. It’s also about what do we do now that we can do differently, and better. In franchising, there’s been some great examples. Home repairs businesses prevented from day-to- day jobs because of government restrictions are now installing Perspex screens to protect retail workers, and partnering with Bunnings home deliveries that have exploded by 100 per cent. McDonald’s and Pizza Hut are providing milk, bread, toothpaste and eggs for people who can’t leave home, as part of a convenience option. This goes to the heart of businesses trying to support vulnerable customers, especially where there was panic buying at the start of the pandemic. Former General Electric chairman and CEO Jack Welch said that when the market is moving faster than your business you’re doomed to fail. And there’s no bigger test of that than right now, in the biggest economic crisis any of us have lived through. Think about your product, your place in the marketplace, and more importantly, the role you can play in helping our community make it through this to the other side. That’s a job for all of us. INDUSTRY INSIGHT “I’ve been particularly impressed by businesses adapting and implementing innovation in the current environment as their strategy to survive, and in some cases even thrive.” About Mary Aldred Mary Aldred has been CEO of the Franchise Council of Australia, the peak body for the nation’s $184 billion franchise business segment, since April 2018, following extensive experience across government, industry and the corporate sectors. As CEO, Mary has led the FCA in developing and delivering strategic priorities to strengthen its role as an effective peak business organisation. As well as advocating for compliance and sustainability in franchising, Mary has positioned the FCA as a strong voice for the needs and concerns of small business and ensuring the profitability and growth of this vital contributor to the national economy. SEP/OCT, 2020 CONVENIENCE WORLD 33