Five Ways To Survive

As we all know in this industry, office coffee service (OCS) and pantry services have been hit the hardest by COVID-19. With office workers not going into the actual office, many operators saw their sales slump as low as 85-90% down from pre-pandemic numbers. So, how can you survive until (hopefully) the tendency to work from home starts to go away and employees return to the office? Nobody knows when things will be back to normal, but many agree that it may not return 100% like it was before COVID-19 hit.

To survive, you must think way outside the box. During these times, surviving is the goal. Even if you wanted to sell your business, there may not be much left to sell. So, how do you hang on?

First, you must change your way of thinking. Many of you have been in business 20, 30 and even 40 years, only to see the shutdown ruin your business. You must change your mindset; it is not what you want to do anymore, it is what you have to do in order to survive. If you retrain your mind to do things differently, it could help.

Here are some ideas to consider:

1. Cut your overhead: Can you rent out a portion of your warehouse space to an outside tenant? Even office spaces can be rented out to independent small business owners who do not want to work out of their houses. Or, do you have any friendly competitors in your city that you could possibly merge with, thus cutting out massive overhead expenses?

2. Cut costs on labor: You might cringe at the idea of running a route again. However, depending on the size of your operation and your age and health, if you only have one or two routes, you might consider this for a short-term solution to save on labor costs. No owner wants to run routes again, but to survive, would it be worth it?

It would also get you in front of your customers again and could help sell more products than a driver, who is hourly or often in a hurry to finish the route and go home. I have talked to several operators, and just about every one of them mentioned that they did not want to lose certain employees — managers, route drivers, etc. — but this is one of those hard decisions that you may have to make to survive.

3. Use your fleet: You already have a fleet of trucks. Could you get into courier services with your fleet? Many courier companies contract their drivers and typically need box vans. Instead of leaving your trucks sitting in the parking lot, you could put them to work and keep an employee at the same time.

Alternately, you could start up a small, local moving service with your vans. If your vans are logoed up, you’ll get additional advertising as your trucks and vans are riding around town. Lots of people are moving from apartments to homes while interest rates are low and they need more room to work from home. You most likely already have moving dollies and extra route trucks.

4. Rent out equipment: You might consider renting out more touchless ice makers and water dispensers. This can be an easy sale if the customer still has the reach-in type of ice machine instead of an ice dispenser. A customer in Colorado told me he was replacing competitors’ old-fashioned ice makers with cup dispenser ice machines. He said it was an easy sell. Also, you can subsequently charge them an ongoing cleaning and filter change fee, which will be a recurring revenue source for you.

5. Expand your service offerings: You might start an office sanitization business — and sell it to your existing customers — and even a cleaning service. This would give your clients one vendor to deal with and could bring in reoccurring business.

HOW TO GET STARTED

It is easy to set up a separate LLC for a side business. Some states allow you to do this process yourself, and without a lawyer. Obviously, you should discuss your options with your accountants, lawyers, and insurance providers to make sure you have things covered correctly. Sometimes it can be as easy as running a DBA under your current LLC or company so you can track expenses and sales separately. (I am a fan of keeping things separate because it makes it easier if you want to divest the new or old company without it being a cloudy mess on paper.)

Sitting and waiting for the “normalcy” to return could cost you a lot more than thinking about new ways to use what you currently have. Thinking outside of the box may help you make money outside of this industry.