PROSPER MAGAZINE: DIGITAL EDITION
BUSINESS SUCCESS CAN RELY ON REPUTATION, NOW MORE THAN EVER - CROWE TELLS PROSPER
How many times have we heard the word “unprecedented” in relation to the coronavirus pandemic over the past few months?
One word that has not been quite as overused is reputation. However, plenty of brands and businesses stand to cement or lose theirs depending on their response to this crisis. And some have already been found wanting, making headlines for the wrong reasons.
Companies are coming under increased scrutiny, whether it is for what they do or do not say. Brand reputation may be hard to measure, but it becomes a valuable asset during times of crisis especially.
Silence isn’t golden
It is no surprise that supermarkets came out on top for having been vocal and responding well, followed by the healthcare, pharma, and food and drink sectors. Meanwhile, in research by Opinium, data shows the top five sectors consumers think have not done anything in response to the crisis are automotive (27 per cent), fashion and beauty (26 per cent), gym and fitness (17 per cent), financial services (15 per cent) and charities (14 per cent).
So, as businesses begin to recover from the impact of COVID-19, national audit, tax, advisory and risk firm Crowe, is calling attention to the importance of reputation and how businesses will be judged on the way they operated in the lockdown for some time to come – including SMEs.
Ross Prince, a partner in the firm’s Midlands office, told Prosper “SME owners tend to leave talk of brand equity and reputation management to the bigger corporations, but many are starting to realise the impact these issues can have on profitability.
“It is important to cut through the noise around lockdown and ask, ‘How will your business be judged in hindsight?’”
He stressed that SMEs and owner-managed businesses need to be aware of how their suppliers and customers have perceived their handling of lockdown, in order to safeguard future relationships.
“The much-publicised trial by press and social media of companies like Boohoo, who were criticised after allegations of poor working conditions in their Leicester factories, may seem like extreme examples to most SME owners.
“But, with social media being so instant, you are never more than a heartbeat away from praise – or condemnation,” he pointed out.
He added that other firms’ use of ‘performance reviews’ in order to cull staff, without considering options under the Coronavirus Job Retention Scheme such as furloughing, had brought swift condemnation.
Slashing prices paid to suppliers without consultation and demanding extended credit terms could also have an impact on how a business is perceived.
“Big companies have teams monitoring how their brand is perceived and working constantly to manage their reputations, but smaller companies equally need to find time and resource to think through their actions and how they will be received in their marketplace,” he said.
“Most company owners have just been concerned with keeping the lights on, working through the lockdown safely, or waiting until a safe return to working is possible. They should also consider how the decisions they have taken, are being, and will be perceived in the coming months.”
Businesses that are seen to be doing the “right thing”, and who work on maintaining strong customer and supplier relationships, are better placed to weather the economic storm caused by the pandemic.
Ross continued, “Those that come across poorly or are criticised in the media, risk suffering reputational damage and seeing their revenues plunge.
“It is better to pause, review the actions you are taking to secure your company’s future and put those actions under the microscope. In these days of cost cutting measures, is your pound spend a sunk cost or an investment in brand and loyalty value, whether that is in your people, your customers or your supply chain.”