Prior to the pandemic, pricing was established on a product or service, and many times we work backward to competitively price our products and services then make it work. When the pandemic hit, many found out they couldn’t make it work. Either they went out of business or started to charge more or were big enough that even though they suffered through it, it hurt them badly. Regardless, growth or shrinking, business sustainability, and continuity that doesn’t build out a plan and then execute it will continue to struggle. Here are some key factors that are forcing change on businesses of all sizes.
Many in our workforce are not returning to the old wage system that was in place before the pandemic. Groups include those who became unemployed and have decided when they return, they don’t want to work the way they used to and for the pay they used to. Remote office workers who worked thru the pandemic but from home in their pajamas with Netflix streaming in the background may not return without a financial incentive.
Our supply chain has been affected. The lumber industry, which doesn’t just include our DIY 2×4’s and plywood but also our paper goods from toilet paper to cardboard boxes, product packaging, and more, has caused ripples through our economy. Everyone sees the effects – from the mining of cryptocurrency requiring more processors, more GPUs, video cards, chips, and computing power. When the chip factory burned to the ground supply shortages and increased demand. The new XBOX and PlayStation consoles are back ordered, and supplies are limited while 3rd party markets have a rise of inflated prices. Cars, trucks, and overall vehicle manufacturing has come to a halt. Look at the car lots when you drive by; they are empty, and they can’t get electronics built for the new vehicles with a shortage of chips.
Oil and gas have been hit a little, but it continues to remind us that our packaging, our computers, our cars, our clothes, and uniforms, much of it is made out of oil and gas products. Combine that with our lumber and steel industries, and the things we consume daily are on the rise both in business and at home. The box your contact lens is packaged in, to the plastic tray, the lens sits in, to the lens itself, let alone the outer shipping containers, the pallets they were staged on, the cardboard and film wrapped around the palleted goods. It is all on the rise.
The pandemic needs us to take a strong look at our market. Which businesses made it, and which ones did not? Pricing is changing from being competitive to what does it take to stay in business. If your market hasn’t changed or you feel you are in a market that isn’t going to change, it might be good to double-check that. Look around at things you wouldn’t have thought would have needed to be double-checked.
